What is it?
Aid may be given by individuals, private organisations, or governments. It is a voluntary transfer of resources usually from one country to another, given at least partly with the objective of benefiting the recipient country. It may have other functions as well: for example, it may be given as a signal of diplomatic approval, or to strengthen a military ally, to reward a government for behaviour desired by the giver, to extend the donor's cultural influence, to provide infrastructure needed by the donor for resource extraction from the recipient country, or to gain other kinds of commercial access.
There are many different types of aid such as:
  • Voluntary Aid
  • Bilateral Aid
  • Multilateral Aid
  • Tied Aid
  • Emergency Aid

Voluntary Aid is also known as charity aid. It is money collected by agencies such as Oxfam and ActionAid which is then spent on a variety of different schemes. Governments can sometimes also contribute to voluntary aid schemes. Most of this aid goes towards long term development, for example in training farmers in efficient farming techniques that also prevent soil erosion. Charities also have campaigns to collect funds and provide emergency aid after a disaster.

Bilateral Aid is the most common type of aid. It is from one country to another, for example Britain giving money and sending experts to help build a dam in Turkey. Quite often bilateral aid links closely with tied Aid.

This other type of aid, tied Aid, the giving (or donor) country also benefits economically from the aid. This happens as the receiving country has to buy goods and services from the donor country to get the aid in the first place. Some people believe that this type of aid can be harmful if it supports governments that oppress their people.

Multilateral Aid means many sides. Here organisations that involve many countries give help. This aid is run by groups such as the World Health Organisation (WHO) and United Nations Educational, Scientific and Cultural Organisation (UNESCO).

Most aid is long term developmental aid. However after a natural disaster such as an earthquake or flood, help is needed straight away. This help includes food, clean water, shelter, medicines and the staff to organise these materials. Such items are not useful for long term aid as local farmers and business people would not be able to compete with the free handouts and so the local economy would be damaged.
How does it reduce disparity?
Aid reduces disparity as it gives goods to the poorer countries, therefore increasing the GDP. However, one is never 100% sure of where the aid actually goes, more importantly if it reaches the needy population.
There are schemes in which the local people take part in small-scale activities which help the local area. They do not usually need high technology, nor do they need a lot of money. Examples of self help schemes include
  • Planting trees, and building lines of stones to reduce soil erosion
  • Training local health workers, who know how to prevent and treat the local diseases and health problems
  • Making bio-gas plants which takes manure and produces gas for cooking and natural fertiliser

All these schemes bring big advantages to the local population, decreasing their gap with other more developed populations.

How successful has it been?

International aid schemes have caused problems, and have been criticised by some people because
    • They may involve the building of an expensive, prestigious building such as a hospital - which will mainly help the urban rich
    • It will involve technology which is inappropriate - a tractor is not much use if there are not spare parts or diesel fuel available locally
    • Large scale projects such as dams may damage the environment and force people off the land
    • Some projects have suffered from corruption - the help has not gone to the people who need it but politicians and officials have greatly benefited

One of the key recommendations of the Consensus was that the rich world nations pledge to donate 0.7% of their annual Gross National Product to extremely poor countries as international aid. However, as of 2009 only 5 have succeeded in donating this percentage of their GNP: Netherlands, Luxembourg, Denmark, Norway and Sweden. In 2005 the economist Jeffrey Sachs released a book in which he argued that the world could eradicate extreme poverty in twenty years time if international aid to Africa was roughly doubled over the course of the next decade.