Greening Aid? – Following the Money in Environmental Aid

In the homo ecos: library, you can find a whole range of ‘green classics’. These books (and magazines and films) are available to browse and borrow for any bookworm who considers themselves a friend of homo ecos:. For those people who do not enjoy the art of reading, our EVS volunteer Janny will read and review one sustainable page-turner every month.

This month: Greening Aid? by Robert Hicks et al.

The global aid market is a multi-billion-dollar industry. Each year, the world’s developed countries (such as the USA, Denmark, Japan, the UK, the Netherlands) transfer unimaginable amounts of money to developing countries (such as Brasil, Kenya, Egypt or India) through projects, loans and grants. This way, they fund anything from building roads and dams, to empowering women and promoting education, to protecting biodiversity and battling climate change.

Follow the money

But where exactly is all this money going? The global aid market is so large and complex, that nobody seems to have a good overview of how much money is being spent, what impact these projects are having, and why countries feel the urgency to invest billions of dollars in other countries in the first place. And how “green” are these development project really?

The book “Greening Aid?” presents the results of an impressive research project carried out by the British College of William and Mary and the Brigham Young University. Together, the researchers have collected information about more than 900,000 development projects financed between 1950 and 2010. This huge “PLAID database” (Project-Level Aid) allowed them to make various statistical queries about the data.

How much money is each country spending? Which countries receive most aid? Are donors investing directly in another country (bilateral aid), or are they using one of the many multilateral institution such as the World Bank? Do richer countries spend more money on aid per capita? Do countries with a left-wing government spend more on green aid? Do countries give more money to their neighbours, their ex-colonies, or countries that vote similarly in NATO?

These are all very important and interesting questions. Unfortunately, the answers make for a rather boring read, full of percentages, dollar amounts, abbreviations, graphs and tables. “Greening Aid?” will look very impressive on your coffee table, but I would sooner recommend it as an insomnia cure than as a page-turner for a rainy afternoon.

Green or Dirty aid?

The researchers went through the painstaking task of cataloguing and analysing almost a million aid projects. First, projects were rated as either Environmental (e.g. protecting biodiversity, mitigating climate change), Dirty (building dams, roads, factories) or Neutral (family planning, women’s emancipation, education).

The second level of labels are (rather confusingly) “Green” and “Brown”. Green Aid targets global issues such as climate change, greenhouse gas emissions or the ozone layer, while Brown Aid tackles more local (though often cross-border) problems such as access to clean water, deforestation, or land degradation.

The book presents a whole range of tables and graphs, showing how much individual countries are spending on Environmental, Dirty, Green or Brown aid, and how spending has changed over time.

The researchers then posit a long list of hypotheses (“Environmental aid will target the poorest countries”, “Countries with large populations will receive more aid of all types”) and use more statistical and financial data to test them.

Some conclusions are to be expected (wealthy donor countries prefer Environmental projects, while poor recipient countries often prefer Dirty aid for new roads and dams), while other conclusions are quite surprising (larger countries more often use multilateral organisations to spend their money, even though you would expect that smaller countries need the aid infrastructure or these organisations more).

Promises from Rio

In the end, the book disappointingly doesn’t really show any Big Trends in the data. Although some of the scientists’ hypotheses turn out to be valid, other money flows seem to defy any explanation.

The one trend that the book does signal – luckily – is a (relative) decrease in Dirty projects, mostly in favour of Neutral projects since 1992, the year of the (often seen as failed) Rio de Janeiro UN “Earth Summit”. Still, in 1999, almost 30 billion dollars were spent on projects that may be helping the world’s people and economies, but that are potentially hurting our planet at the same time.