Foreign Aid - 1. Foreign Aid a. How is foreign aid defined?...

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1. Foreign Aid a. How is foreign aid defined? (What are official and unofficial flows?) Official: public bilateral and multilateral aid “developmental assistance” Unofficial: private assistance provided by non-gov organizations. 2 objectives: non-commercial from the point of view from the donor, and concessional terms/repayment period/interest rates are softer than commercial terms. b. What types of aid are more valuable and why? Grants are better than loans, tied funds less popular. c. What are to donor motivations for providing aid? 1) Political motivation: Marshall Plan 1940 prevent spread of communism, rest of Cold War keep a country friendly to West, an incentive to form similar political structure. 2) Economic motivation: reform that promotes growth, trade, new markets for donor country (open good markets) 3) Health concerns: stop spread to rest of world of diseases 4) Stop spread of political or economic disasters following a country’s natural disaster/politically unstable period. d.
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Foreign Aid - 1. Foreign Aid a. How is foreign aid defined?...

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