Washington DC (TDI): The United States has been a major contributor to international development for decades, with the US Agency for International Development (USAID) providing aid to Mozambique and South Africa. However, uncertainty over the future of such assistance has arisen in recent congressional battles in the United States, raising concerns about the potential implications for these countries.
The US has been the top bilateral donor to Mozambique, providing more than $560 million in yearly aid. This assistance covers a wide range of areas, including health, education, and economic development.
In South Africa, USAID has supported programs to promote economic growth, health outcomes, and democratic governance. For example, nearly $7 million has been allocated to the Trilateral Assistance Program (TAP) to help South Africa act as a regional exemplar in promoting economic and social growth in Africa.
Recent congressional hearings have raised questions about the effectiveness and strategic value of US foreign aid, with some lawmakers favoring a more transactional approach in line with the “America First” policy. This shift may result in considerable aid cuts or redirection, thus jeopardizing ongoing projects in Mozambique and South Africa, as reported by the African Report.
The suspension of aid threatens to hamper efforts to relieve hunger, provide critical medicines, and promote economic development in those countries. Many low-income countries rely on foreign aid, in some instances accounting for more than 50% of their gross national income. The suspension could deepen their debt crises, which alone cost developing countries a record $1.4 trillion to service in 2023, according to Reuters.
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In Mozambique, USAID has been instrumental in boosting the economy and trade. The agency’s trade and investment hubs are aimed at complementing both regional and bilateral efforts to bolster Africa’s economic competitiveness. A reduction in aid could stymie such efforts, thereby slowing economic progress and development.
Furthermore, South Africa has faced political tensions with the US, especially regarding its positions on international matters. A striking example is South Africa’s decision to file a genocide case against Israel at the International Court of Justice. This resulted in the US suspending aid and threatening to revoke its tariff-free access to the US market under the African Growth and Opportunity Act (Agoa).
Such actions could further strain diplomatic relations and impact South Africa’s economy, especially its agricultural sector.
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The Path Forward
In determining the fate of USAID and its funding allocation, Congress must consider the long-term ramifications of slashing assistance to nations like Mozambique and South Africa. While it’s justified to re-evaluate aid effectiveness and ensure realignment with US strategic aims, hasty cuts could destabilize regions that depend on this assistance to support basic services and developmental projects.
A more balanced response is viable to reform aid programs to be more efficient, transparent, and aligned with U.S. priorities and the priorities of recipient countries. Goodwill dialogues with African nations can help understand their needs and perspectives for enhanced partnership and sustainable development outputs.
As the US reconsiders its foreign aid practices, it has to consider long-term geopolitical and humanitarian ramifications against the short-term fiscal benefits. Strengthening support for nations such as Mozambique and South Africa has the double benefit of helping their development and creating stability and prosperity worldwide.
