While US and EU aid cuts could encourage Africa to end its dependence, the challenges of poor countries are particularly challenging.
The administration of US President Donald Trump has wreaked havoc in Africa and more by suddenly dismantling the multi-billion-dollar International Development Agency (USAID). This has ended countless development projects and put millions of recipients at risk.
Due to the confusing methods that the US has done about them, it is difficult to quantify the cuts. However, the 5 341 USAID program worth US$75.9 billion has been wiped out, Devex said. Devex is an independent news organization that covers development issues by citing leaked USAID documents. There are 898 programs remaining, worth around US$78 billion. Devex said the US State Department has also lost 200 aid programs, totaling US$4.6 billion.
The Security Institute Head Jakkie Cilliers (ISS) Africa’s Futures and Innovation (AFI) Programme summarized the potential global impact. Using various sources, he states: 1 million cases of serious and potentially fatal childhood malnutrition. 600% HIV infection. And the spread of hunger as a life-saving and sustaining food aid of USD 489 million is at risk of corruption, delay or appropriation.
In Africa, AFI modeling estimates could have around 5.6 million very poor people by 2026, and by 2030 the entire African economy could shrink by around USD 4.2 billion.
Cilliers notes that US official development aid accounts for around 30% of the global total, while the European Union contributes to around 42%. And what is largely ignored is that several EU states, including France, Germany, the Netherlands and Belgium, are also cutting aid budgets. The UK and Switzerland are also around 25% each.
This is mainly because in an increasingly dangerous world, Trump is threatening to withdraw US support from Europe, especially as he faces a greater threat from Russia.
“Europe is restructuring development aid, moving from traditional grants to investment-driven funding, cutting budgets, prioritizing defenses and raising concerns about the future of global development,” according to Devex.
African countries are slower to decide how to fill in the big holes in their development budgets. For example, finding ways to increase domestic revenue with more efficient tax revenue services.
South African President Cyril Ramaphosa confirmed last week that the US decision to cut Pepfer, which contributed 17% of the cost of South Africa’s fight against HIV/AIDS, was a “wake-up call” to fund that 17% itself.
However, Groundup and Spotlight said the crisis broke out in January, but it only took South African Health Department until March 3 to meet with USAID implementation partners. And “it was not yet allocated to fill the huge hole left by the Pep Far Cut, which is estimated to result in hundreds of thousands of deaths in the next (10 years).
Others see this as an opportunity to change dependence on African donor countries – as Kenyan satirist and commentator Patrick Gatara did last week in a Resistance Bureau webinar in Africa after Africa.”
He lamented that the discourse that cut aid was primarily a “return to the old tales of a desperate continent that could not care for themselves without the help of good Westerners.” Instead, Africa is the global net creditor, and donor countries have won $8, $7, $8, for every dollar they spent on aid, he said.
Gatara suggested that other African countries learn from Kenya. Kenya specifically protested last year against President William Root’s attempts to raise taxes. They demanded that he balance the book by tackling corruption and excessive government spending instead.
Nick Cheeseman, a professor of democracy at the University of Birmingham, agrees that by increasing public pressure on the government, the yawning gap in aid income must be bridged, and by changing income away from corruption in the provision of services. He told the webinar that South Sudan, for example, spent a small percentage of its budget on healthcare, relying on the US to provide about 60-70% of its funding.
But Cheeseman said it is problematic to guide that pressure, especially as aid cuts are reimbursing civil society organisations that promote democracy and excellent governance.
Cilliers said USAID is the leading funder of programs to strengthen democratic institutions, human rights and governance across Africa. This sector was one of the sectors affected by the cuts, with more than 90% of the USAID and State Department funds for this work being abolished.
He said the lack of democratic aid could entrench authoritarian leaders, cause political instability in Africa, making African countries more susceptible to undemocratic countries like China and Russia.
Cheeseman believed countries like the United Arab Emirates and Saudi Arabia would partially fill the vacuum of development funding. “So the new game may be more problematic from the (point of view) of the African Renaissance,” he said. Meanwhile, the US will hand over these other countries a huge amount of soft power, including policy impacts.
Cilliers told the webinar that AFI research showed that the democracy levels in many African countries were higher than expected, taking into account the level of development. He attributed some of its “democratic surplus” to the democratic efforts funded by conditionality and Western aid agencies.
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Formal development assistance is a form of international cooperation in the 1960s and 1950s,” Remy Liux, CEO of the French development agency, told Devex. “What happens now coincides with what the world has become, and we need a new architecture. We need to go from support to investment – a sustainable and comprehensive investment.”
However, the Cilliers warned those celebrating the end of Africa’s aid dependence that trade and private investment would not be easy to solve the challenges of development on the continent. He said that the 22 most developed countries in Africa are ordered only about 0.4% of global trade, while 24 low-to-middle-income countries enjoy only about 1%.
“Hoping these countries will emerge from poverty is at best a multi-generational project,” he pointed out. “Large multinationals are not investing in poor countries. Global philanthropy and diaspora will (Africa) funds can’t fill the remaining holes. Africa is increasingly becoming itself, but its economic independence has a price.”
Perhaps the only bright spot is that some gaps from the USAID will be met by European countries using opportunities to harness their soft power as a competition with tensions and competition.
For all its manifold errors and challenges, European aid is traditionally more transparent and based on aid from the US and political and policy dialogue.
Peter Fabricius, consultant at ISS Pretoria
