Foreign Aid as “Soft Power” (in India, Brazil and China)
Posted on 20 October 2010
By Sherine Jayawickrama
The embrace of foreign aid as an instrument of “soft power” and as a pillar of foreign policy has been notable in the United States – and it is increasingly so in India, Brazil and China as well. It is a reflection of how the landscape of global development and aid financing has changed in recent years. I’m not sure that NGOs are yet fully coming to terms with what these changes mean.
Vijaya Ramachandran at the Center for Global Development blogged a couple of weeks ago about India’s emergence as an aid donor. She noted that, although India was the largest recipient of foreign aid in the mid-1980s, it is now the fifth largest donor to Afghanistan and its aid to Africa has grown at a compounded annual growth rate of 22 percent over the past ten years.
The Economist recently argued that Brazil was, in search of soft power, turning itself into one of the world’s biggest aid donors (see Speak Softly and Carry a Blank Cheque – subscription needed to view the complete article). Although the Brazilian Cooperation Agency (ABC) has a relatively small budget, there are a plethora of Brazilian institutions that provide assistance to developing countries. The total value of all Brazilian aid could be close to $4 billion a year – similar to donors like Sweden and Canada (except for the strong upward trend in Brazil, compared to stagnant levels in many countries that are more traditional donors).
In recent years, China has become a major donor and investor in developing countries, especially in Africa. According to a Congressional Research Service report, China’s aid to Africa, Latin America and Southeast Asia increased from less than $1 billion in 2002 to an estimated $25 billion in 2007. In addition to aid to Africa, China is beginning to cancel debt to African countries, sending volunteers to Africa and offering scholarships to African students.
Although the numbers (magnitude of aid or investment streams, growth rates, etc.) are impressive in and of themselves, it could be the opportunity to provide a different kind of support for development processes that could be most significant. In article in The Economist, the head of ABC in Brazil notes that there is “a Brazilian way” of engaging in foreign aid provision, based on the social programs that have been successful in Brazil. Providing AIDS treatment to the poor and conditional cash transfer programs like Bolsa Familia are examples.
China, Brazil and India don’t have clear definitions of what constitutes foreign aid or systems for tracking various disbursements or investments that would fit such a definition. Their emergence as aid donors is very welcome in that can help disrupt traditional donor-recipient identities and relationships. But there is still a need for more transparency to provide citizens of both recipient countries (and these new donor countries) the information they need to hold aid providers to account.
Many international NGOs were founded and grew as a result of moral and financial support mobilized in the west – both from private individuals, foundations and corporations and from western government donor agencies. Are these NGOs well positioned to adapt to the major economic and geopolitical shifts that are occuring globally? And how are they coming to terms with what these shifts imply for their own roles and relevance?
Sherine Jayawickrama manages the Humanitarian & Development NGOs domain of practice at the Hauser Center for Nonprofit Organizations and this blog.