Foreign aid has long been promoted as a tool to alleviate poverty, yet growing evidence suggests it often does more harm than good. Instead of fostering sustainable development, aid can entrench dependency, weaken institutions, and encourage misgovernance. The Economist (2025) noted that in countries like Malawi, years of donor-funded projects have failed to produce meaningful economic transformation. Despite billions in aid, basic services remain inadequate, and governments often prioritize donor satisfaction over citizen needs (“Aid cannot make poor countries rich”, The Economist, March 6, 2025).
Economist Dambisa Moyo also argues that aid fosters a cycle of dependency. In her book Dead Aid, she highlights how continuous financial assistance undermines incentives for reform and innovation, enabling corrupt regimes to remain in power without accountability. This sentiment is echoed by development experts who observe that aid can crowd out domestic revenue collection, disincentivize local entrepreneurship, and reduce the urgency for institutional reform.
In short, while aid may address short-term humanitarian needs, it often fails to tackle the root causes of poverty. As The Economist concludes, true progress in poor countries requires economic freedom, transparent governance, and self-reliant growth—not perpetual reliance on handouts