What Determines Exit from Aid-dependence?

Abstract

At the Fourth High Level Forum on Aid Effectiveness, the African Union stated that “the post-Busan agenda for Africa is in essence a programme to reduce aid dependency and ultimately exit aid” (AU, 2011: 11). This One Pager sketches out the attributes of an aid exit strategy to inform such an agenda. We ranked 132 countries based on their aid-to-GDP ratio and grouped them into deciles for the past five decades. The Figure plots the deciles for the 1960s relative to the 2000s. The additional horizontal and vertical lines correspond to the 5th deciles as a threshold for higher and lower degrees of aid-dependence. The 45° line is the locus of countries that have experienced no change in their ranking of aid-dependence between the decades. (…)