Aid Flows in East Africa

In 2011 the region received $8.3 billion in total net disbursements of aid up from $7.9 billion in 2010, and representing 18 per cent of total aid flows to sub-Saharan Africa for 2011. The combined budgets of the East African countries for 2012/13 were $34 billion. It is worth noting that the $8.3 billion in aid disbursed in 2011 represents just under 25 per cent of the region’s budget in 2012/13.

These data on aid flows in 2011 do not include the cuts experienced by Uganda and Rwanda in 2012, a year that also saw a shift in aid allocations by donors away from the poorest countries and towards middle-income countries. OECD data shows that bilateral aid to sub-Saharan Africa was
$26.2 billion, representing a reduction of almost 8 per cent in real terms compared to 2011.

While the aid cuts to Uganda and Rwanda may have been triggered by specific idiosyncratic reasons, there are signs that declining aid flows to the region could soon be a strong feature of its economic relationship with donor countries. The next textbox outlines the European Union’s justification for the cut in aid to Uganda, followed by a summary of Rwanda’s innovative response to the aid cuts it faced in August 2012.

Pages: 1 2