Full Test Bank | National Development Agencies And – Ch.9

Chapter 9

National Development Agencies and Bilateral Aid

Multiple Choice Questions

1. What is bilateral aid?
   1. Foreign aid given to, and distributed by, international institutions like the World Bank or UN agencies.
   2. Foreign aid provided directly to the government of a developing country by the government of an industrialized country.
   3. Foreign aid that is only given in cases of humanitarian disasters, such as famines or earthquakes.
   4. Aid that is given in much smaller amounts than multilateral foreign aid.
   5. None of the above
2. The expression “foreign aid” is often used interchangeably with which more technical term?
   1. Results-based aid
   2. Tied aid
   3. Bilateral development assistance
   4. Non-governmental assistance
   5. Official development assistance
3. Which of the following is a controversial practice regarding official development assistance?
   1. Imposing harsh penalties for delinquent loans
   2. Increasing the ratio of grants to loans
   3. Counting the cost of resettling refugees
   4. Setting higher grace periods for repayment of loans
   5. Providing concessional loans
4. Approximately what percentage of global official development assistance is provided by members of the Development Assistance Committee (DAC)?
   1. Less than 70 per cent
   2. 70–75 per cent
   3. 75–80 per cent
   4. 80–85 per cent
   5. 85–90 per cent
5. Which of the following is NOT a common use of foreign aid?
   1. To purchase technology
   2. To provide training and build local capacity
   3. To prevent policy reform
   4. To provide humanitarian assistance
   5. To promote social services
6. What was the total amount of official development assistance in 2017?
   1. US$90 billion
   2. US$43 billion
   3. US$88 billion
   4. US$147 billion
   5. US$207 billion
7. Which country provided the highest total amount of official development assistance in 2018?
   1. Sweden
   2. Denmark
   3. China
   4. The United States
   5. Canada
8. In which decade did total aid increase rapidly?
   1. 1950s
   2. 1960s
   3. 1970s
   4. 1980s
   5. 1990s
9. In what year did the UN set the goal for all member nations to contribute 0.7 per cent of their total GNP?
   1. 1970
   2. 1980
   3. 1985
   4. 1990
   5. 2000
10. Which of the following is NOT a common motivation for giving foreign aid?
    1. A selfless desire to help less fortunate people abroad.
    2. A humanitarian emergency, such as a natural disaster.
    3. The pursuit of other foreign economic or security objectives.
    4. International legal requirements set by the United Nations.
    5. A means of increasing the international prestige of the donor country.
11. Which of the following statements is true of “tied aid”?
    1. Tied aid is foreign aid that must be used to purchase goods and services from the donor country.
    2. Tied aid is foreign aid that must be used to purchase goods and services in the country that is receiving the aid.
    3. Tied aid is foreign aid that is delivered more slowly because of UN bureaucratic regulations.
    4. Tied aid is foreign aid that is only available after certain reforms are successfully undertaken in the receiving country.
    5. None of the above
12. As of 2018, how many DAC countries met the goal of 0.7 per cent ODA?
    1. Three
    2. Four
    3. Five
    4. Six
    5. Seven
13. By what logic can ODA be considered an obligation?
    1. International human rights law
    2. Common law
    3. Communitarian duty
    4. National self-interest
    5. International norms
14. Tied aid is thought to increase costs to developing countries by how much?
    1. Up to 15 per cent
    2. 10 to 25 per cent
    3. 15 to 30 per cent
    4. 30 to 45 per cent
    5. 50 to 75 per cent
15. Which of the following countries has abolished tied aid?
    1. The United Kingdom
    2. France
    3. Portugal
    4. The United States
    5. South Korea
16. When was the Canadian International Development Agency founded?
    1. 1948
    2. 1958
    3. 1968
    4. 1978
    5. 1988
17. Which of the following criteria is NOT a condition for receiving aid via the United States’ Millennium Challenge Corporation?
    1. Democracy
    2. Gender equality
    3. Free market reforms
    4. Good governance practices
    5. All of the above are conditions.
18. In relative terms, which of the following countries was the most generous aid donor in 2018?
    1. Canada
    2. Britain
    3. Sweden
    4. China
    5. Turkey
19. Countries that have “graduated” economically—and therefore have been removed from the Organization for Economic Co-operation and Development’s list of qualifying aid recipients—do NOT include which of the following?
    1. Portugal
    2. Greece
    3. Singapore
    4. China
    5. Israel

1. In 2016-17, which region received the most foreign aid?
   1. Sub-Saharan Africa
   2. Asia
   3. Oceania
   4. Latin America
   5. Eastern Europe
2. In 2017, which of the following was NOT one of the top five most ODA-dependent countries?
   1. Ethiopia
   2. Central African Republic
   3. Marshall Islands
   4. Micronesia
   5. Tuvalu
3. Which of the following is NOT a common criticism of aid harmonization?
   1. It is unwise to enable only a few development plans given widespread past failures.
   2. It assumes recipient countries have consulted their people to determine their interests.
   3. It concentrates the power of donors over recipients.
   4. It makes corruption and graft much more likely by reducing transparency.
   5. All of the above are common criticisms.

23. What are “donors”?

• 1. A group of developing countries aid agencies
  2. Providers of development assistance
  3. A group of Global South NGOs
  4. Providers of military assistance
  5. Providers of corporative consultants

24. What are some multilateral organizations?

• 1. Donors’ Clubs
  2. DAC and ODA
  3. World Bank and United Nations agencies
  4. Countries like Libya and Nigeria
  5. OECD

25. How does military and diplomatic initiatives affect ODA?

• 1. ODA suffers from up and down cycles.
  2. What constitutes ODA can no longer be easily determined.
  3. What constitutes ODA can be easily determined.
  4. ODA can no longer be delivered on a government-to-government bases.
  5. ODA becomes multilateral.

26. How do donors organize themselves?

• 1. In government-to-government mechanisms
  2. In the Development Assistance Committee (DAC)
  3. In agencies
  4. In corporations
  5. In state-to-state global institutions

27. What trends has foreign aid followed in the last decades?

• 1. A constant increase
  2. Economic cycles
  3. Irregular cycles of increases and decreases
  4. The path of the Chilean miracle
  5. A negative growth

28. How is relative generosity calculated?

• 1. By dividing ODA by gross national product (GNP)
  2. By dividing ODA by gross national income (GNI)
  3. By dividing ODA by gross domestic product (GDP)
  4. All of the above
  5. None of the above

29. Why did donors cut their foreign aid in the 1990s?

• 1. Because of terrorism
  2. Because foreign aid was not needed
  3. They could not find new ways to deliver their aid
  4. The collapse of agencies worldwide
  5. Because of budget deficits

30. How has the fight against poverty reignited donors’ interest in foreign aid?

• 1. Via a new consensus to fight poverty, mainly in African countries
  2. Foreign aid has not actually been reignited
  3. Through globalization
  4. By applying new development theories
  5. By helping countries in East Asia

31. What is the effect of the Sustainable Development Goals (SDGs) in the development of foreign aid policies?

• 1. There is a before and after SDGs in the allocation of foreign aid
  2. Not very influential as aid levels stagnated after 2016
  3. Highly analyzed through several studies
  4. A tool for fighting poverty in African countries
  5. It has become an excuse for developed countries to cut foreign aid

True or False Questions

Bilateral aid involves only two countries.

Multilateral aid does not involve states.

Official development assistance can come in the form of donations from private corporations.

All countries that provide foreign aid belong to the OECD’s Development Assistance Committee.

The US is the most generous donor in absolute terms, but one of the least generous in relative terms.

“Aid fatigue” occurred during the Cold War as superpowers’ budgets were increasingly consumed with the nuclear arms race rather than foreign aid.

Canada does not meet the 0.7 per cent ODA goal set by the UN in 1970.

More foreign aid is multilateral than bilateral.

In 2017, total ODA was equal to private flows of capital to developing countries.

A “whole-of-government” approach to aid provision integrates foreign aid with a state’s other foreign policy goals.

“Tied aid” requires recipient countries to purchase goods and services from donor countries.

The Millennium Challenge Corporation (MCC) channels American foreign aid to countries that meet certain criteria involving the presence of free markets, democracy, and good governance.

The US government denies any self-interest in its aid donations.

France and Britain focus the majority of their ODA on their former colonies.

The major aid agency in the British government is the Department for International Development (DFID).

The United States and Japan are at the top of the Center for Global Development’s 2018 Commitment to Development Index.

A state must be classified as “developing” to receive official development assistance.

Results-based management is an approach to improving aid effectiveness that requires the results of aid to be measurable and verifiable.

The Millennium Development Goals put poverty reduction back on the front-burner of aid and development.

All scholars agree that foreign aid is an effective approach to bring about development.

There is a general consensus that aid should be channelled through states rather than private or voluntary sector organizations in order to achieve maximum effectiveness.

The Paris Declaration on Aid Effectiveness (2005) gave recipient countries the leading role in designing and implementing development strategies.

Most of China’s financial support to developing countries meets the definition of ODA.

Foreign aid usually promotes social services, including education and health care.

OECD prevents the information of donors from becoming publicly available.

The prospect of aid harmonization strengthened in the 2010s with the rise of “emerging” donors such as Brazil, China, India, and South Africa.

In 2017, DAC donors contributed more than US$147 billion ODA.

Turkey is a traditional DAC donor.

Russia is the world’s most generous donor.

Donors felt disappointed at the levels of corruption in recipient countries.

Self-interested motives for ODA include assisting “friendly” countries, pursuing security objectives, and facilitating investment and trade relations.

Aid programs can serve to raise the donor’s profile internationally.

Short Answer Questions

1. Present at least two current controversies over how official development assistance should be counted.
2. Provide at least five major purposes of foreign aid.
3. Identify the major dynamics within cycles of foreign aid since 1970.
4. Explain what many consider to be the most important motivation for foreign aid.
5. Define and describe the concept of “tied aid.”
6. Discuss the US bilateral aid regime. How do the country’s interests and position in the world influence its aid regime?
7. Briefly discuss several features of donor countries.
8. Why is it difficult to rate the overall performances of bilateral aid agencies?
9. Identify the features of Britain’s Department for International Development (DFID) that give it a reputation as one of the world’s greatest bilateral development agencies.
10. Briefly discuss several features of aid recipient countries.
11. Why is the list of largest ODA recipient states potentially misleading?
12. Discuss the debate over whether assistance should be aimed at fighting poverty or at promoting economic growth.
13. What are the key points in the debate over whether funds should be given directly to states or channelled through NGOs?
14. Explain why it can be both positive and negative for donor countries to harmonize their foreign aid.
15. Discuss the debate between those who think that aid should be given to the poorest countries and those who argue that aid should go primarily to those countries with the capacity to make the most effective use of it.
16. How is the contribution of ODA to development a contested topic?
17. Why is argued that aid coordination is significant in achieving progress in development?
18. Why are some Western donors concerned about Chinese aid?
19. What self-interested motives do donors follow when delivering foreign aid programs?
20. How is ODA currently linked to economic liberation?
21. Why is ODA sometimes seen as a form of compensation?
22. Why is ODA sometimes seen as an obligation?

Essay Questions

1. Explore how foreign aid has changed from the 1950s to the Sustainable Development Goals (SDGs).
2. Why is foreign aid often controversial? And why is it likely to continue to be controversial in the future?
3. How is Chinese aid different from DAC funding? What is the significance of these differences?
4. How has foreign aid been applied after World War II?
5. Compare and contrast the characteristics of two donor countries.