8 Serious Pros and Cons of Foreign Aid

Myths about foreign aid have been circulating for some time now but people cannot discount the fact that it has many benefits both to the host country and to the recipient. Some of these myths include its ineffectiveness and that the United States is spending 25% of its annual budget for helping poor countries. Also, by year 2035, the problem of poverty in Third World countries will be completely eradicated. But just like any other controversial topic that is of global proportion, opinions of politicians, sectors and voters will always be conflicting.

Foreign Aid Defined

Simply put, this is the act done by a country or an international organization to help other countries in terms of supplying goods, services and monetary aid. This can be in the form of military assistance, medical aid, food and training. This can also be given as a form of loan. Moreover, purposes can vary from fighting poverty to promoting development. Normally, developed countries help developing and under-developed countries.

The earliest foreign aid given to other countries can be dated back to wars between countries, in the form of military aid. Powerful countries helped war-stricken countries at times of turmoil and chaos. The U.S. is one nation which has been active in sending military troops as allies to invaded territories in Asia and in other parts of the world for so many years. Nowadays, aid given has transcended to other types of support.

Many organizations and private citizens also push for financial aid, including Bill and Melinda Gates. The software magnate is openly expressing his desire to put an end to poverty and polio in the world. He said that if the aid will be planned accordingly and channeled correctly, the world can feel its importance and efficacy. Some of these organizations are the World Bank, United Nations Children’s Fund and the International Monetary Fund. However, there are also relevant points raised by opposing groups.

List of Pros of Foreign Aid

1. It can help ease poverty in poor countries.
Supporters of foreign aid posit that if rich countries will work hand in hand to help developing and poverty-stricken countries, this can help solve the problem of impoverished nations. With millions of families living below poverty lines, contributing in any way through money, trainings and medical assistance can promote equality and better the lives of other people.

2. It is beneficial to involved countries, the donor and recipient.
Giving foreign aid is between two nations and this humanitarian activity is not only a good thing for the country receiving help but also to the giver of financial aid. By helping another country, diplomatic relations will be nurtured. By showing its appreciation, the country which was given aid in any form will be open to help the richer country in times of need, be it in military services or letting the host country station its base in their country. This will be strategic for the former in times of war.

3. Extending foreign aid will help other countries be more independent.
Advocates say that by helping poor countries and giving them financial assistance and helping them in times of natural disasters and providing medical help like vaccines for diseases, a time will come that these countries will be able to improve their economies. Moreover, with eradicating diseases such as polio, there will be more competent citizens and aid their economies as well. Eventually, these countries will not be needing aid anymore but instead, be the ones to pay it forward like Peru, Japan and China.

4. It can help other nations fight drugs and other problems like HIV/AIDS.
Many organizations are helping in the dissemination of information about transnational problems like drugs and HIV. The International Narcotics Control program sets aside funds to help fight drug problems in other countries.

List of Cons of Foreign Aid

1. Foreign aid does not go to the people because of corruption.
Opponents of this policy argue that in most cases, help fails to reach the right people who are really in need of assistance. There are poor countries with corrupt officials who use the fund for themselves and that little or no aid is given to the poorest members of the communities. They also say that this can even stir and encourage corruption in these countries.

2. Favoring selected countries over other can be a problem.
Critics of foreign aid say that oftentimes, developing countries which can give back benefits are the ones given assistance instead of nations which really need help. They also argue that some countries who give aid use this as a tool to control the recipient country in terms of favors like setting up military bases, which leave the poor country no choice.

3. Giving financial aid like loans only leave these poor countries deeper in debt and poverty.
People who are against giving loans to under-developed countries say that the IMF can sometimes be reckless in approving loans for programs that are not really beneficial to the recipient country but instead, more harmful. They also point out that these countries become poorer because instead of using their funds to invest in profitable projects and channel their income to other investments, they use what they have to pay their debts.

4. Foreign aid amounts to 20% of American people’s money and it is wasteful.
Another setback that is apparently clear is that instead of using the fund to improve the lives American people, a big chunk of the money goes to other countries which, sometimes, do not deserve to be helped. They argue that the U.S. has been extending aid and yet most of these nations still live in poverty.


Giving financial aid to despondent nations is a humanitarian gesture and promises several benefits. However, critics are also correct in saying there are loopholes in the system. The best way to address this is to come up with a structural design to ensure aid is given to the right recipients and that it is properly implemented, with utmost focus on corruption.

About the Author
Brandon Miller has a B.A. from the University of Texas at Austin. He is a seasoned writer who has written over one hundred articles, which have been read by over 500,000 people. If you have any comments or concerns about this blog post, then please contact the Green Garage team here.