Chapter 5 | Page 205
implementation, especially for recipient States.78 This also diverts scarce State
resources or some of the aid away from more urgent developmental purposes.
5.3.1.2 Conditionality and tied aid
Conditionality and tied aid pose additional challenges and reduce the overall
benefits to recipient States. While conditionalities related to human rights and
democracy are undoubtedly positive, not all conditionality seeks to address
such concerns. Donors are often accused of ‘foul play’ when conditionality is
driven by political expediency, economic factors or security interests rather
than human rights, democratic and governance objectives.79 Such political
conditionalities are often characterised by paternalism, bribery, restraints and
false signalling about the sincerity of aid80 and may be imposed on the
recipient by the donor through a coercive relationship rather than one of mutual
engagement and negotiation.
Tied aid is the term used to describe aid that retains most of the value in the
donor country by imposing the condition that certain goods and services must
be procured from the donor country rather than the recipient country, which
may in fact produce cheaper and better options. It is argued that tied aid is a
de facto subsidy to companies in the donor country, thus raising the question
of who actually benefits from aid.81 The main concern is that this form of aid
represents home country subsidies in disguise.82 From a human rights
perspective, such conditionalities create a significant challenge for States,
especially poorer ones, in maximising resources for policy areas that are in
78
Ibid.
79
Olav Stokke (ed), Aid and Political Conditionality (Routledge, 2013).
80
Paul Collier et al, 'Redesigning Conditionality' (1997) 25(9) World Development 13991407; Machiko Nissanke, 'Shifting Grounds in Aid Relationships and Effectiveness
Debate: Implications for Economic Development in Sub-Saharan Africa' in Machiko
Nissanke and Yasutami Shimomura (eds), Aid as Handmaiden for the Development of
Institutions: A New Comparative Perspective (Palgrave Macmillan, 2013) 48, 57.
81
Ortiz, above n 15, 70; Klingebiel, above n 3.
82
Ortiz, above n 15, 6. Although there has been a recent drive to untie aid, only a few donor
countries such as Finland, France, Germany, Ireland, Japan, the Netherlands, Norway,
Portugal, Sweden, Switzerland and the United Kingdom have fully untied their aid
contributions.
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