07 July 2010

Haddad on Cash Transfers

Lawrence Haddad at IDS notes that all of the recent big cash transfer successes have been led by governments rather than donors. 

There have been too many donor driven pilot schemes in sub-Saharan Africa that have not taken off due to lack of political support. The successes cited in the article have been home grown: Mexico, Brazil, South Africa. What donors can do best is to be nimble, nurturing and flexible enough to support home grown political energy for cash transfers when and where it exists. This is what donor support for cash transfers should prioritize and it is what aid more generally should seek to do.

I would disagree for 3 reasons.

  1. His list (Mexico, Brazil, South Africa) are all middle-income countries. If we wait for the rest of sub-Saharan Africa to become middle-income… then isn’t half of the problem solved already? Won’t that take too long?
  2. Donors should not necessarily blindly follow where governments lead. They can and perhaps should play a catalytic role in experimenting and encouraging the government to experiment with new policies (and robustly evaluating them!) to generate new knowledge.
  3. Mobile technology. Soon there will be an M-Pesa which works globally. And then…

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On a side note – Haddad references a Sunday Times article – which he can’t link to because of the new paywall. Anyone want to bet against the Times paywall experiment failing?

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