Types+of+Aid+-+T&T

=Types of Aids =

Bilateral Aid
Definition: When the flow is from one advanced economy to a poorer nation

Example: Solomon Islands-Australia Partnership for Development - Australia signed an aid partnership with Solomon Islands in order to assist the Solomon Islands directly with development

4 economic outcomes of the bilateral aid partnership
 * 1) Improve service delivery
 * 2) Improve economic livelihoods
 * 3) Improve economic infrastructure
 * 4) Address economic and fiscal challenges


 * Multilateral Aid **

Definition: When aid flows to the developing nation through international lending agencies and organizations such as the United Nations or the World Bank

**Tied Aid** __Definition__: The recipiient country has to agree to buy goods or services from the donor country. __Characteristic:__ //Advantage// //Disadvantage// __Example__: In the UK, the Overseas Development Administration (ODA), was under the supervision of the [|Foreign Secretary] and the [|Foreign and Commonwealth Office], which led, on at least one occasion, to allegations of a connection between the granting of aid and the achievement of either foreign policy goals or British companies winning export orders. A scandal erupted concerning the UK funding of a hydroelectric dam on the Pergau River in Malaysia, near the Thai border. Building work began in 1991 with money from the UK foreign aid budget. Concurrently, the Malaysian government bought around £1 billion worth of arms from the UK. The suggested linkage of arms deals to aid became the subject of a UK government inquiry from March 1994. In November 1994, after an application for [|Judicial Review] brought by the [|World Development Movement], the [|High Court] held that the then [|Foreign Secretary], [|Douglas Hurd] had acted [|ultra vires] (outside of his power and therefore illegally) by allocating £234 million towards the funding of the dam, on the grounds that it was not of economic or humanitarian benefit to the Malaysian people[|[2]]. In 1997 the administration of the UK's aid budget was removed from the Foreign Secretary's remit with the establishment of the [|Department for International Development] (DfID) which replaced the ODA. Tied aid is now illegal in the UK by virtue of the [|International Development Act], which came into force on 17 June 2002, replacing the Overseas Development and Co-operation Act (1980). fact from wikipedia: []
 * Enable developing or poor countries to develope their economic to a certain step
 * Acts as a small barrier for developed countries or the recipient country to further develope their economy since they are force to buy from their donor country while there are other substitute goods
 * Has a percentage of pulling both countries down toward economic crisis or debt

**Official Aid** [] __Definition__: Aid administered by governments or government agencies __Characteristic__: //Advantage// //Disadvantage// __Example__:
 * Allows industries or firm to work efficiently
 * Be further used to develope country itself with roadways, school, and hospital
 * investment or helpful aid for foreign country (especially during natural disaster such as Haiti)
 * improve labour force and citizens standard of living
 * if the aid falls into a corrupted government, the spending would be worthless
 * aid is invested in the wrong criteria of country development; military instead of hospital or schools

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 * __Sources:__**