EVENTS

Date:	Monday, April 20, 2009
Time:	3:00 PM -- 4:30 PM
Location:	Wohlstetter Conference Center, Twelfth Floor, AEI 1150 Seventeenth Street, N.W., Washington, D.C. 20036

WASHINGTON, APRIL 24, 2009--The international development establishment has responded to the global economic crisis with calls for increased aid and lending to Africa. On April 21, AEI scholars and Dambisa Moyo, the author of Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa, gathered to discuss proposals for increasing foreign assistance to Africa and reasserting the role of international financial institutions—particularly the International Monetary Fund (IMF) and the World Bank—on the continent. According to Moyo, the international financial institutions should play a short-term role in helping Africa weather the financial crisis. "My sense is that bailout aid is required," she said. "I do believe that given the situation in the markets, there is a role for the International Monetary Fund." Nevertheless, this role should not extend to open-ended aid commitments. Instead, loans and foreign assistance to Africa should be targeted toward short-term goals that will allow the continent to survive the worldwide downturn.

AEI's Henry Wendt Scholar, Nicholas Eberstadt, agreed that foreign assistance is not the solution to Africa's development challenges. Over the past sixty years, he said, official development assistance (ODA) has failed to bring significant economic development and growth to the continent. "Looking toward the future will require a big change of the role of ODA in the region and not least the expectations for ODA's performance." Eberstadt previously addressed foreign aid reform in an AEI Development Policy Outlook, in which he and Carol Adelman argued for a new "business model" for U.S. foreign aid.

AEI visiting scholar and former World Bank president Paul Wolfowitz put forward a more positive outlook toward Africa. The continent is home to some significant emerging economic success stories, such as Mozambique and Rwanda, whose presidents have implemented business-friendly reforms and attracted investment to their countries. "There's something going on there and, to put it in its shortest single word, it is leadership."

Africa's strategy for dealing with the global economic crisis will be different than that of the United States, Europe, or Asia. Global financial institutions and foreign aid may be able to mitigate the downturn in the in the short-term, but they cannot be substitutes for long-term private sector growth.

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