Aims of research report
The African continent has received aid from developed countries and financial policy recommendations for decades. This thesis seeks to examine the existing empirical studies on the macro-micro paradox effects of foreign aid and free trade policies on GDP growth in Sub-Saharan Africa. In particular, this study explores the negative effects foreign aid has on the social contract that exists between the governments and its citizens by making governments less financially dependent on it’s populous, whether the interaction of international financial institutions (IMF, World Bank, WTO) that promote free trade policies as part of loan agreements with Sub-Saharan African countries agencies is promoting growth, how large inflows of foreign currencies finance unproductive public consumption and fail to promote savings, exports or investments. The study also explores whether governments and aid agencies in Sub-Saharan Africa possess the transparency, political will, and infrastructural capabilities to dispense aid allocations in effective ways to stimulate growth. Lastly, the study will explore if Sub-Saharan African countries should employ a mixture of protectionist and open trade policies, constantly adjusting it according to its changing needs and capabilities, while limiting aid to only the infrastructural and health sectors.
Method
Most African countries are entirely dependent on aid from the developed countries. The effects of aid towards development of the continent is paradoxical and differs from one person to another. Although financial aids are meant to bolster the economic prosperity of a country, there are numerous negative impacts of accepting aid. Such impacts include unlimited debt, interference of policies, corruption and embezzlement of the aid received. So as to investigate and validate this hypothesis on the negative aspect about the effect of free trade policies and foreign aid to Sub-Saharan Africa it is important to acquire the relevant statistical and empirical data with regards to how the aid received was implemented in society and its impact of the citizens and the nation alike. It is logical for any developed or developing nation to keep financial records about the government incurred costs, depending on the technology used these data always date back decades. The analysis of these data is an important step towards validation of these hypothesis. By analyzing how foreign aid and policies such as the free trade agreements affects a nation, the study will be able to access the positive and negative impacts such policies bring.
During this study, a form of pilot study tendered towards gathering of information on important subjects such as public perception to foreign aid and free trade agreements, impact of free trade on a country’s’ economy, mismanagement of foreign aid due to rampant corruption in the government and debt incurred on a countries economy due to foreign aid. By use of the pilot study first, factors such as time, cost, feasibility study and statistical variation will be determined that will help when the quantitative research is launched at a larger scale. The statistical and practical applications of all the data analyzed from the pilot study will help determine the methods that will be used in collection of qualitative data that will help make a conclusion. The methods that will be employed in the collection of qualitative data will depend on factors such as technological advancements of the area, literacy levels, ease of movement, security restriction and governmental interference. After determing of these factors that hinder collection of the qualitative data, various methods will be employed to counter such problems example being acquiring relevant permits that legalizes the data collection activities, employing native speakers of the region to translate, use of online surveys and use of surveys in areas that lack technological accomplishes such as internet and electricity.
The Sub-Saharan African continent has great minds and individual but the level of academic literacy does not encompass the whole country and so as to avoid biased data collection, relevant measures will be taken to address all issues that will arise with these factors. This can be accomplished by educating the masses on the research topic or by creating a simple memo addressing the importance of the study, implications of the study and how the study will affect their day to day activities. transparency should be maintained at all times and all the data collected through questionnaires, interviews, action research, observation and ethnography will be collected and analyzed. By use of mathematical and scientific models, the data will be decoded and interpreted by use of graphs and computer simulation. Through the decoded data, the study will be able to determine with substantial proof the correctness of the hypothesis.
Feasibility
The feasibility assessment of this study determines the suitability of the study and the research methodologies to be used during data collection by assessing the willingness of the participants and analyzing how the study is conducted. A feasibility assessment of this study will help identify all logical problems that can be accounted during the study and help determine the positive and negative impact of the study before embarking on full scale qualitative data collection. A feasibility assessment accounts for factors such as: Financial feasibility which determines the operational cost of the study, resource feasibility, operational feasibility and legal feasibility. Through this assessment, it will be able to determine the criteria needed to be met during this study and the approaches to be taken to ensure voluntary and willing participation in the study.
How the study impacts existing publications
Africa is full of developing economy and needs financial aid to boost the economy and fund major projects. However, negative impact of aid on a developing economy should not be under estimated. Financial aid has severe implications to a countries economy with the main issue being increased foreign debt that causes financial and political instability by making the country solely dependent and aid . This study is in line with such school of thought and helps illustrate how the Sub-Saharan economy dependence on aids stunts the growth of the country’s economy and how mismanagement and government bureaucracy is the main reason for this new trend of aid dependence and misuse
The last three decades has seen African countries embrace reforms that have led to the adaptation of the free trade policies in Africa. Countries from the same or different region came together to form blocs that helped to ease the capability of trade between one country and the other. This treaty in Africa was concluded in 2008 and is known as the Africa Free Trade Zone which was a combination of the three major trade blocs of COMESA, SADC and EAC. The purpose of the free trade zones was initially to eliminate trade barriers and to increase the trade of goods and services between the countries in the bloc. However, this study tends to highlight the problems that accompany free trade agreements.Such problems include: differences in economic strength, job loss, adverse working conditions and opposition from some trade unions within the country. This study aims to find out if the free trade policies can actually bring about economic prosperity of a region. The study will also explore the positive factors that can about with implementation of free trade policies, such factors include: emergence of new markets and higher levels of investment capital.
Conclusion
It is fundamentally important for the Sub-Saharan Africa to develop economic policies and institutions that will rapidly aid her transition from a low to high income Sub-Continent. Targeted interventions by the state is needed to push economies towards the global technological frontier, especially in the manufacturing sector, while relinquishing dependence on foreign aid and natural resources. I believe strong vibrant economies in the region will not only raise productivity, industry and GDP in the region, it will additionally raise social factors such as the standard of living, security, and social mobility. Therefore, this thesis will look to contribute positively to such goals.
Works Cited
Brown, stephen. "Foreign Aid and Democracy Promotion: Lessons from Africa." The european journal of Develoment Research (2005).
Dasha Chatrna, E. M. Ekanayake. "The effect of foreign aid on economic growth in developing countries." Journal of International Business and Cultural Studies (2007): 13. Document.
Ogundipe, Adeyemi A. Ogundipe & Paul Ojeaga & Oluwatomisin M. "Is Aid Really Dead? Evidence from Sub-Saharan Africa." International Journal of Humanities and Social Science (2014): 15. Document.
Paez, Laura. "A Continental Free Trade Area: Imperatives for Realizing a Pan-African Market." journal of world trade (2016). Document.
Reddy, Karunanidhi. "Developing Africa: Trade barriers, liberalisation and ineqaulity on the world trade organization." African Journal of Business Management vol 5 (2011): 11. Document.
"SADC-COMESA-EAC: Free Trade Zone." Africa Research Bulletin: Economic, Financial and Technical Series (2008): 18011A-18012C.
