There have been various approaches to development for poverty reduction since efforts have been made to promote and encourage development in non-Westernized nations.
These approaches have been varied in nature, ranging from the initial Basic Income Approach in 1901 (see Rowntree) to the Empowerment Approach in 1983 (see Chambers) to the Systems Development and Integrated Natural Resource Approaches in the 21st century.
Poverty, as it relates to these efforts, can be understood as a state in which,
“Resources (material, social, and cultural) are so limited as to exclude them from the minimum acceptable way of life in the countries in which they live.”European Union, 1984
Actions prior to 1961 were financed by individual countries or not at all. However, in-line with the Cold War, the concept of development aid was introduced in 1961. Aid in this respect aimed to ‘encourage’ countries to develop in accordance with standards promoted by the donor source, e.g. USA or Russia. Financial aid in this respect was designed to support economic, social, environmental, and technical development.
The first groups providing large sums of financial aid were the Development Assistance Group [DAG)] in 1961 and Official Development Assistance (ODA) in 1969. The motivations for engaging in such practices can be interpreted in a number of ways.
However, the effects of developmental aid have been disappointing and often ineffective with many of the problems that were faced in the 1900s still rampant in modern society despite costly interventions. The reasons for which are not clearly understood but can include, for example, cultural differences, corruption, and alternative motives for participation.
Regardless of the reason for such inefficiencies, the United Nations continues to encourage developed nations to contribute .7% of their GDP to development efforts. Contributions can take the form of
- simple donations
- bilateral aid, e.g. governments working in collaboration via international aid agencies
- multilateral agency intervention, e.g. The World Bank
- charity development agencies, e.g. Oxfam. Donation rates were calculated at 165,788.46 million USD in 2015.
In order to improve the effectiveness of aid and accordingly empower countries to take charge of their own development, two major declarations have been made. The first of which is the Paris Forum on Aid Effectiveness that was designed to institutionalize development aid and ultimately improving efficacy. This approach is based on five principles which are:
- Ownership: developing countries should establish their own strategies
- Alignment: donor countries align behind these objectives using local systems
- Harmonization: donor countries coordinate, simplify, and share information to avoid duplication and promote coordination
- Results: shift towards results-based procedures
- Mutual accountability: where both donors and partners are accountable for the outcomes
To help fulfil the objectives of the Paris Forum, the Accra Agenda 2008 was introduced to promote a more stable environment for supporting development. The main points of this agenda are:
- Predictability: donors should provide donors should provide three to five years of notice of planned aid to partner countries
- Ownership: countries should have more say over the actions taken
- Country Systems: partner country systems should be used to deliver the aid
- Conditionality: building on the country’s ability to manage their own future
- Cornwall, A., & Brock, K. (2005). Beyond buzzwords “poverty reduction”,“participation” and “empowerment” in development policy.
- Devarajan, S., Miller, M. J., & Swanson, E. V. (2002). Goals for development: History, prospects, and costs. The World Bank.