What is wrong with aid, you say? So many things ....
Undermined Accountability
One of the central issues with foreign aid is that it diminishes the incentive for governments to develop robust domestic tax systems. When African governments receive substantial funds from external donors—largely from Western sources—they become less responsive to their citizens. Reliance on foreign aid acts as a substitute for domestic revenue collection, effectively weakening democratic accountability.
Unsustainable Projects
Aid agencies often favor launching new initiatives over sustaining existing ones. Operated on short-term cycles of five to ten years, these programs prioritize fresh starts to meet donor expectations rather than long-term impact. This “build-and-destroy” model means promising projects frequently fail to reach sustainable maturity. While detailed empirical studies on this cycle are limited, the recurring pattern in development discourse underscores the inefficiencies created by shifting mandates .
Extraction and Destruction of Talent
Another problem is the brain drain that occurs when aid agencies offer salaries far exceeding those in the local public or private sectors. By attracting the best local talent, these agencies effectively strip the private sector of a certain type of talent. Over time, these professionals find themselves caught in a cycle of short-term, cycle-driven work that rarely contributes to lasting local development. This basically means, aid takes good talent and over time makes them less and less effective. They cease to understand what it means, what it takes, to make things successful. There is an acknowledgement within the private sector that you can't hire from the impact sector -- these people think there is always a tomorrow where the company surely will exist, money grows on trees, etc.
Can't Fund Unless Utterly Useless
The funding criteria for projects or startups supported by aid agencies are often contradictory. Donors expect projects to demonstrate both need and a track record of success—a paradox that starts a cat and mouse game with team/project needing to portray an image of limping along just enough to qualify for "applicable" grants. Understandably, a highly successful project in a foreign country funded by an aid agency that's backed by another government is a PR nightmare. So aid can give money, but only if the target doesn't end up too successful, or preferably not successful at all.
Dependency & Governance
Ultimately, the cumulative effect of these issues is a dependency on aid that undermines local governance. When governments rely on external funds rather than on building their own revenue streams and institutional capacities, the result is weakened self-governance and a lack of long-term development. Studies have shown that this dependency, combined with the cyclical nature of aid projects, can erode the incentives for domestic reform and accountability.
While foreign aid can play a critical role in addressing emergencies and crises, its long-term effects are far more complex—and often counterproductive—than its immediate benefits suggest.
I have lived on this continent for three decades now. I can count the number of successful aid funded long term initiatives on one hand, typically by making my index finger touch the tip of my thumb.