Introduction

This chapter analyzes international aid (Official Development Assistance or ODA) to Tanzania over the period from 1980 to 2012 and makes comparisons with Ghana and Uganda, countries that are also significant recipients of aid and have experienced similar pressures from donors for policy reform. It considers the implications of some issues arising from the ODA statistics and reviews relevant literature, including official publications, relating to the Tanzanian ‘aid experience’. Particular attention is paid to the impact of aid on economic growth and poverty reduction. Specific Tanzanian ‘aid issues’ are discussed including Budget Support, corruption and alignment with the principles of the Paris Declaration.

The cases of two of the three countries referred to in this chapter, Tanzania and Ghana, are also discussed in Whitfield (2009). The growth experiences of all three of the countries discussed in this chapter are also referred to in Chapter 1 of this volume. Whitfield and Fraser (2009) make the point that the economies of some of the countries previously regarded as highly aid-dependent have experienced rapid economic growth and are now both less aid-dependent and have access to other sources of funding, particularly China and India. Such changes in the availability of funding options have implications for issues such as policy conditionality, although the reforms already carried out imply that such issues are no longer a major source of disagreement.

Initially this chapter presents the aid statistics for the three countries in recent years. It then considers their respective records in terms of economic growth and poverty reduction and makes comparisons of the aid experiences and growth outcomes for the three countries. The chapter then proceeds to examine the specific case of Tanzania in detail in relation to the issues of Budget Support, corruption and the specific aid strategies adopted over time before concluding on the Tanzanian experience.

Aid to Tanzania, Ghana and Uganda

Table 11.1 shows summary data from the OECD DAC's website (OECD DAC 2014a) for the years 2010 to 2012. In current US$ prices Tanzania's per capita Gross National Income (GNI) has recently been about 20 per cent higher than that of Uganda, and Ghana has a per capita GNI about 2½ to 3 times that of Tanzania and Uganda.