Aid Industry

Development Delusions ← Series Home Can Less Be More? A Radical Rethinking of Foreign Aid Throughout this series, we have dissected the development delusions—the $200+ billion industry built on contradictions, fueled by imperatives to spend, obsessed with control, staffed by transient expatriates, and locked in a symbiotic trap with recipient governments. We have seen how it generates processism, how it ignores the vast informal economies where most people live and work, and how it fundamentally struggles to catalyze the deep, politically contentious transformations that genuine development requires. The question that remains is: can this industry reform? Can less, indeed, be more? This final post confronts the implications of our anatomy. ...

Development Delusions ← Series Home Informality: The $200 Billion Elephant in the Room The development industry, for all its sprawling complexity and vast resources, has a profound and systematic blind spot. It operates almost exclusively within the formal sectors of recipient economies—the registered businesses, legal land markets, and state-defined urban spaces. Yet, an enormous proportion of economic activity and, crucially, the lives of the majority of people in the rest, takes place outside this formal realm, in what is broadly termed the informal sector. David Sims argues that this “elephant in the room” is simply ignored by the industry, despite its implications being “vast and sobering”. This post explores why the formal-sector bias exists and why it matters for understanding development’s limited reach. ...

Development Delusions ← Series Home The Development Dance Redux: How Mutually Reinforcing Dependencies Guarantee the Status Quo The development industry, characterized by its sheer scale, self-perpetuating spending compulsion, and obsession with control, operates in an environment of institutional tension with the governments it purports to serve. This tension, the “development dance”, is not merely a dysfunctional accident; it is a symbiotic trap where both donor and recipient governments develop mutually reinforcing dependencies that ultimately ensure the continuity of the aid system while perpetually postponing difficult, transformative change. David Sims asserts that the industry’s malaise is “more than the sum of its individual parts”, primarily because the systemic connections between the donor world and the recipient governments lock both into an increasingly self-referential cycle of ‘processism’. ...

Development Delusions ← Series Home The Recipient’s Arsenal: Negative Manipulation, Passive Aggression, and Exploiting Donor Vulnerabilities The relationship between Western donor agencies and governments in “the rest” is formally described using lofty terms like “partnership” and “country ownership”. However, the reality of this interaction is fraught with profound power imbalances, tension, and obstructionist undercurrents. David Sims frames this interaction as the “development dance”—a constant, seemingly never-ending process of negotiation and bargaining that neither party leaves particularly satisfied. The dance persists because both parties willingly join it, but it often breaks down, requiring renegotiation. ...

Development Delusions ← Series Home Uncomfortable Truths: Exposing the Colossal Remuneration Differentials and Their Corrosive Effects The rhetoric of “partnership” and “country ownership” (Post 5) fundamentally clashes with a pervasive and often unacknowledged reality within the foreign aid industry: the colossal disparities in pay, perks, and status between Western donor staff (and their consultants) and their local counterparts in recipient governments. David Sims identifies this economic chasm as an uncomfortable truth that permeates and poisons almost all development activities, generating suspicion, jealousy, and tension, while actively undermining critical objectives such as capacity building and genuine teamwork. ...

Development Delusions ← Series Home The Development Dance: How Donor Control and Conditionalities Render “Country Ownership” a Hollow Artifact The bedrock of contemporary international development rhetoric rests upon two seemingly noble concepts: partnerships and country ownership. These ideas are pervasive in global aid discussions, creating the impression that donor agencies and recipient governments collaborate as equal partners toward shared, self-determined goals. David Sims argues, however, that this “schizophrenic world of partnership” is largely an illusion, a set of empty words that mask the profound power imbalances and the existential need of donors to control how their money is spent. ...

Development Delusions ← Series Home The Procurement System, the Myth of Neutral Expertise, and the Monopolization of Country Knowledge The foreign aid industry’s compulsion to incessantly move money (the imperative to spend, Post 2) requires a sophisticated, yet self-defeating, mechanism of control. This countervailing obsession with control dictates that funds are disbursed only through processes that are sanitized, auditable, and firmly managed by the donor, not the recipient. The primary vehicle for enforcing this control—and for generating the massive volume of documentation that defines development—is the procurement system. David Sims contends that procurement, particularly the acquisition of “expertise” through opaque consulting networks, does more than just spend money; it effectively colonizes the recipient country’s intellectual space, monopolizing knowledge and shaping the national development narrative to fit external, donor-driven agendas. ...

Development Delusions ← Series Home The Product Development Compulsion and the Chronic Problem of Donor Overload The preceding posts established the foreign aid industry’s overriding need to perpetually spend allocated funds, or the “imperative to spend” (MMS). This necessity is directly linked to another core competence of donor agencies: product development. This refers to the constant, relentless search for new ways and sectors to spend money, creating a proliferation of diverse and complex interventions that touch almost every area of human endeavor in developing countries. ...

Development Delusions ← Series Home The Money Moving Syndrome and the Institutional Drive for Disbursement Over Development Among professionals familiar with the international development sector, the obsession of donor agencies with spending allocated funds—spending quickly, and spending ever increasing amounts—is a pervasive and continuous feature. This phenomenon, often dubbed the Money Moving Syndrome (MMS), overshadows all other goals and ultimately serves as the primary starting point for analyzing the pathologies of the aid industry. David Sims argues that this compulsion to move the money (MMS) is so profound that it leads to perverse incentives and structural failures, often pushing the entire development effort to the “absurd point where the donor has a greater need for giving the aid than the recipient has for taking it”. ...

Development Delusions ← Series Home A Sketch of the Development Industry and Its Self-Perpetuating Structure The global machinery dedicated to international development cooperation, often affectionately termed the “development community” to give it a “cuddly glow,” is more accurately described as a massive, complex, and little understood industry. This classification is not merely semantic; David Sims asserts that understanding the foreign aid ecosystem requires recognizing it as a business enterprise defined by quantifiable financial flows, a vast workforce, fierce competition for funds, and an overriding obsession with self-perpetuation. ...