Look who's saving the world: BRICS pump up foreign aid

The so-called BRICS — Brazil, Russia, India, China, and South Africa — are upping their foreign assistance by leaps and bounds at a time when traditional donors’ aid budgets are frozen.

Western donors are no longer the only significant providers of international aid as emerging powers are extending their outreach abroad.

For more than a half-century, Western donors have dominated international aid. Rich countries such as the United States, Canada, Britain, and Japan have sent resources, technical expertise, human capital, and ideas to help countries in Africa, Latin America, and Asia develop economically.

But over the last half-decade, the traditional flow of money has begun to shift dramatically, according to a report released today by Global Health Strategies Initiatives, an international nonprofit. The so-called BRICS countries — Brazil, Russia, India, China, and South Africa — are increasing their foreign assistance by leaps and bounds at a time when traditional donors’ aid budgets are frozen or even decreasing.

Traditional donors still vastly outspend their peers in the BRICS. But as the BRICS begin to play a larger role, they stand to reshape not just the budgets but the entire philosophy of international aid. While aid efforts in the past have often been conceived and designed in Western capitals, BRICS countries are refocusing on approaches and innovation conceived in and made for the global South.

“Rather than seeing [beneficiary countries] as grantees, they are more likely to see them as partners,” says Sridhar Venkatapuram, a lecturer at Cambridge University and contributor to the report.

Of course, like traditional donors, the BRICS also bring their own baggage to the table. Aid tends to align with geopolitical interests and focus on areas that are linked to the countries’ domestic economies or priorities. But Western countries have long had a monopoly on using development assistance to curry favor. It’s only natural for the world’s rising powers to get into the game.

Double-digit spending growth

Between 2005 and 2010, Brazil and India grew their foreign aid spending by more than 20 percent. China and South Africa both upped their assistance by about 10 percent. Russia, which had increased its own spending earlier in the decade, now devotes about $500 million annually to development spending overseas.

Over the same period, the foreign aid budget of the United States grew just 1.6 percent. The aid budgets of Britain, France, and Germany all grew slower than 5 percent annually. To codify their increasing efforts, BRICS countries will consider a proposal by India to unify development efforts and create a “BRICS Development Bank” — an analogy to the World Bank, long dominated by Western nations — when they meet for a summit in New Delhi on March 28 and 29.

Among the most promising aspects of the BRICS increased development assistance are their own recent domestic experiences combating similar troubles, the report argues. Public health challenges persist on a large scale in all five countries, but so too do examples of success.

“[Common] experience in a way puts the BRICS and the grantees on the same side in dealing with challenges,” says Dr. Venkatapuram. “The lessons and insights shared by peers can potentially be more relevant and effective.”

India takes lessons abroad

Take India, for example, which succeeded in eradicating polio in February 2012, just three years after reporting the highest caseload of any country in the world. The country’s success was locally driven: The government poured in $1.49 billion over a decade to inoculate the population and build the local health infrastructure necessary to treat the disease. Now it’s looking to take its experience elsewhere. Over the last three years, India has spent $100 million on health projects overseas, largely focused on building up local medical systems and transferring expertise.

Brazil provides a similar example with HIV, an area in which it has invested massively both at home and abroad. In 1996, Brazil’s government promised to provide Anti-Retroviral Treatment to all AIDS patients in need of treatment.

“At the time of Brazil’s commitment, many global policymakers doubted the feasibility of providing universal access to ARV treatment in a developing country with limited resources,” the report recounts. “Brazil’s success upended this conventional wisdom, and the program has become a source of great pride. As a result, other developing countries have sought Brazil’s cooperation and counsel on their own HIV/AIDS and ARV policies.”

The example of HIV assistance from Brazil is indicative of the strategy that nearly all BRICS countries favor: Let demand drive aid. Many of Brazil’s HIV programs overseas in African countries were inaugurated at the request of those local governments, not Brasilia’s suggestion.

For recipient governments, there are also advantages to seeking assistance from BRICS countries, rather than traditional donors. “BRICS have recent and continuing experience with responding using limited resources, low cost resources and strategies, and reaching large populations in non-urban settings,” says Venkatapuram.

The Indian health sector has focused innovation on e-health in recent years, for example, providing diagnosis for conditions by remote teleconferencing. Such technologies are geared precisely to the developmental conditions that a country in, say, West Africa might require. And they are systems that the West simply doesn’t have (or need) access to.

Lack of transparency, monitoring

Development aid from the BRICS is not, of course, immune to the challenges that have plagued assistance from the West for decades. Critics note that the development institutions set up in each of the BRICS countries lack the same level of transparency and monitoring that one might find in, for example, the US Agency for International Development.

The BRICS also clearly have their own interests for getting involved overseas. International influence is one motivation, says Eduardo J. Gomez, a professor at Rutgers University who is writing a book on Brazil’s rise and has studied the country’s health programs overseas. “Brazil has always wanted to be with the ‘in crowd,’ if you will, at the international level, always wanting to get involved and influential.”

There are also more direct advantages for the new donors. Brazil’s and India’s global health programs overseas, for example, often draw on local drug industries at home, providing a market for vaccines and generic treatments. China’s international aid has perhaps come under the most scrutiny for being opportunistic, securing access to minerals and other raw materials in exchange for foreign aid. “By helping to improve health in developing countries, Chinese policymakers feel they can have health impact and help build political and economic alliances,” the report argues.

Still, for the large part, the new donors are being welcomed, says Dr. Gomez. “There's is no hostility or jealousy from the traditional donor nations,” he said on Sunday. “My sense is that the world recession has led traditional donor leaders to welcome contributions from Brazil and other nations.”