chapter  5
17 Pages

Aiding the state or aiding corruption? Aid and corruption in post- conflict countries

BySARAH VON BILLERBECK

The preamble of the UN Convention against Corruption (UNCAC) opens with a declaration of concern regarding ‘the threats posed by corruption to the stability and security of societies’ (UN 2003). While corruption can exist in any society – wealthy or poor, developed or underdeveloped, integrated into the world economy or isolated – it is an issue of particular importance in those countries recently emerged from civil war, where the risks of renewed conflict remain acute. However, though the link between corruption and instability is made explicit by the UNCAC and others, efforts to combat corruption after conflict are less well developed. This is partly because one of the most important forms of post-conflict intervention, international aid, may actually exacerbate corruption and imperil the ultimate goal of peacebuilding: building state capacity to peacefully manage and prevent conflict.1 More specifically, the way in which aid is given after conflict introduces a trade-off between the goals of peacebuilding and corruption: aid that is delivered through the state may strengthen the state, but it may also trigger increased corruption and decreased accountability; aid that is delivered outside of state channels may be protected against corruption, but weaken the state and prevent the consolidation of peace. Understanding the link between corruption and aid in post-conflict states is critical, as aid disbursements in post-conflict countries are large, sometimes exceeding the recipient country’s gross national income (GNI). For example, official development assistance was 99 per cent of DR Congo’s GNI in 2003 and 186 per cent of Liberia’s GNI in 2008.2 Such large-scale aid disbursements in the aftermath of civil war reflect the increasing recognition by donors of the link between economic recovery and stability. Poverty and economic inequality are considered key sources of conflict, and jumpstarting economic activity and macroeconomic growth after war are perceived as critical to the consolidation of peace.3 Aid is central to achieving this goal. However, less has been said about the particular processes that can bring about conflict transformation through economic assistance (Donais 2005: 16-17; for exceptions, see Del Castillo 2008, Boyce and O’Donnell

2007a).4 The failure to examine how aid ensures stability has meant that post-conflict aid has received insufficient critical attention and has instead been almost universally acclaimed as beneficial, though there has been an increasing recognition of the problem of post-conflict countries’ ability to absorb aid, and debates about the phasing-in of assistance (see for example Collier and Hoeffler 2004b). Though it undeniably entails benefits, including the financing of social projects in health and education and the rehabilitation of critical infrastructure, there is a paucity of analysis of the potential unintended consequences of economic aid in the special circumstances of a post-conflict country. While these may be many – aggravated income inequality, overexploitation of natural resources, overly rapid market liberalisation – corruption is of particular concern as its inherently political nature means that it can derail not only economic reconstruction but also the tenuous political processes unfolding in postconflict countries. Moreover, the potential of aid to trigger corruption is a topic that has received growing attention, not only in scholarly circles but also in the popular media. A 2010 opinion piece in the International Herald Tribune about corruption in Afghanistan asserted that ‘the way in which aid is given is at the heart of the problem’ (Sud 2010), while an article in the New York Times the previous year noted that the deeply corrupt Afghan government, which is ‘kept afloat by billions of dollars in American and other aid’, is rapidly losing legitimacy and respect in the eyes of its population (Filkins 2009). In a report on the relationship between aid and security in Afghanistan, Fishstein (2010) observes that interviewees’ most common complaint was about corruption associated with aid projects. Writing on Sub-Saharan Africa, Moyo (2009: 48) argues that ‘aid is one of [corruption’s] greatest aides’, not only because it enables rent-seeking, but also because donors do not withhold aid where corruption is rampant, points to which I return. Ugandan journalist Andrew Mwenda even goes so far as to advocate a complete stop of aid flows to Africa, claiming that international money does not reach those in need but ends up instead in the pockets of corrupt officials (Mortishead 2006). This chapter examines the relationship between aid and corruption in countries that have recently emerged from civil war. It does not explore these issues in countries experiencing interstate conflict, nor does it look at corruption within donor organisations, but instead focuses on how international aid affects domestic corruption after internal conflict in order to determine whether aid can be inimical to peacebuilding. I take as my definition of corruption the version offered by Philp in this volume (p. 34), in which corruption entails not only the abuse of office for personal gain, but also for sectoral or partisan gain. The remainder of this chapter is divided into three parts. First, I discuss the circumstances in post-conflict states that make them susceptible to corruption, before outlining the debate about whether corruption is

worsened in post-conflict societies and describing the data problems that complicate quantitative analysis of these questions. Second, I turn to how the goals of peacebuilding and the methods of aid collide to produce a situation in which corruption may be an unintended by-product of building state capacity to maintain peace. More specifically, I examine the manner in which aid is disbursed, arguing that aid that is given directly to the government, for example in the form of budgetary support, can strengthen the state but increase corruption; while aid that is disbursed around the state, in particular through project implementing partners, can contain corruption but weaken the state, and work against a fundamental goal of peacebuilding. Finally, I discuss some of the barriers to building anti-corruption initiatives into peacebuilding.