The Macroeconomic Challenges of Scaling Up Aid to Africa

By Yongzheng Yang, Robert Powell, Sanjeev Gupta

September 1, 2005

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Yongzheng Yang, Robert Powell, and Sanjeev Gupta. The Macroeconomic Challenges of Scaling Up Aid to Africa, (USA: International Monetary Fund, 2005) accessed September 24, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper surveys the economic literature on the scaling-up of aid to Africa. It provides a checklist of issues that need to be considered when preparing a long term macroeconomic projection for a country involving the assumption of a significant increase in aid. Such scaling-up scenarios are most likely to be developed in the context of a country's efforts to achieve the Millennium Development Goals (MDGs) with the support of the international donor community. The paper stresses that when preparing a scaling-up scenario it is critical to have a detailed understanding of the likely use of additional aid flows.

Subject: Aid flows, Exchange rates, Expenditure, Foreign aid, Foreign exchange, Real exchange rates

Keywords: Africa, Aid, Aid flows, Crowding in, Debt service, Diminishing returns, Exchange Rate, Exchange rate appreciation, Exchange rates, Fiscal Policy, Governance, Monetary management, Monetary Policy, Nominal exchange rate, Private sector, Production function, Public spending, Real exchange rates, Revenue ratio, WP

Publication Details

Pages:

63
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2005/179
Stock No:

WPIEA2005179
ISBN:

9781451861983
ISSN:

1018-5941

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