Memoire Online - Impact of foreign aid on rwanda's socio-economic development as guided by Millennium Development Goal (MDG) 1 “Eradication of extreme poverty and hunger”:case of Gasabo District

Impact of foreign aid on rwanda's socio-economic development as guided by Millennium Development Goal (MDG) 1 “Eradication of extreme poverty and hunger”:case of Gasabo District

DECLARATION

I hereby certify that this thesis entitled «The impact of Foreign Aid on Rwanda's socioeconomic Development as guided by Millennium Development Goal 1» is entirely my own work, except where stated otherwise, and that it has not been submitted for any other degree or professional qualification.

Title of project: The impact of Foreign Aid on Rwanda?s Socio-Economic Development as guided by Millennium Development Goal (MDG) 1 «Eradication of extreme poverty and hunger»: The case of Gasabo District.

Programme for which project was presented: Master of Science in Development Studies Degree

Permission is hereby granted to the Women?s University in Africa library to produce single copies of this project and to lend or sell such copies for private, scholarly or scientific research purposes only. The author reserves other publication rights and neither the project printed or otherwise reproduced without the author?s written permission.

The undersigned certify that they have read and recommended to the Women?s University in Africa for acceptance, a project entitled, «The impact of Foreign Aid on Rwanda?s SocioEconomic Development as Guided by Millennium Development Goal (MDG) 1 - Eradication of extreme poverty and hunger»: The case of Gasabo District, submitted by Claire Marie Michele MUKARUTESI in partial fulfilment of the requirements for the Master of Science Degree in Development Studies.

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DEDICATION

This research is dedicated to my husband Maurice A. KAMANZI, my children Rita Gloria O. IHIRWE, Omer Herve GANZA and Pedro ISHIMWE KAMANZI for bearing up with me when I could not be there for them, you are the epitome of God?s faithfulness in my life, I LOVE YOU GUYS!!!

My profound gratitude goes to all people who immensely contributed to the success of this study. All the assistance and support given is highly appreciated. May God bless you.

ACKNOWLEDGEMENTS

First and foremost, I would like to thank the God Almighty, for creating the human being that I am, that He cares for and protects so dearly.

This thesis to be what it is, it could not have been possible without the input of a huge number of people. Many people within government departments, civil society organisations and academic institutions in Rwanda and Zimbabwe, gave up enormous amounts of time to assist me in gathering data, in establishing contacts and in working through my ideas. This research was made possible by the collaboration of so many staff in Rwanda?s Ministry of Finance and Economic Planning, Ministry of Local Government, Gasabo District and Donor Community in Rwanda, please accept my gratitude. My gratitude goes to all respondents from the research areas, for participating and sharing their experiences. I would particularly like to thank the Management of Rwanda Development Bank-BRD for allowing me to conduct my research into the Institution.

I would like to extend my profound gratitude to my supervisor, Mr O. Nyaude for his patience and commitment in assisting me in shaping an idea, and an aspiration into reality. Without your encouragement, constructive criticism, and academic prowess, this project would have been done properly. Many thanks go to the Women?s University in Africa, to the Faculty of Social Science, Department of Development Studies.

Throughout this research my husband Maurice KAMANZI has given me just the right mix of encouragement and criticism at all the right times, I do not have words to appreciate your invaluable input I am indebted to you for that; My children Rita Gloria O IHIRWE K., Omer Herve GANZA K., Pedro ISHIMWE KAMANZI, Thank for your understanding, support and love during this strenuous period- I love you more for that!!!

Finally, I want to thank my Mother, brother, Sisters and friends Vedaste Kalima and Immacullee Nyiraminani, who have encouraged me throughout this process. Without your support and your constant faith in me this research would never have happened.

ABSTRACT

The aim of the study was to investigate and assess the impact of foreign aid on Rwanda?s socioeconomic development as guided by Millennium Development Goal (MDG1) To eradicate extreme poverty and hunger?. The study was undertaken with selected respondents drawn from Gasabo District of the Kigali City in the Republic of Rwanda (a developing nation in East Africa).

Both qualitative and quantitative research approaches were used. Data were collected by means

of interviews, observational schedules, documentary analysis procedures, questionnaires and Focus Group Discussion (FGDs) schedules from a total of one hundred and fifty (150) respondents. Nine (9) of these were Heads of departments/administrators. The study found that the majority of the respondents perceived foreign aid as pivotal in promoting socio-economic development of any given developing country. The eradication of poverty in society was viewed as a worthwhile undertaking and helps address socio-economic problems. They hailed the need to understand the scope of MDGs and its need to be included in the various Rwandan curriculum

However the study established that there are mixed feelings with regard the impact of foreign

aid, its challenges and prospects in general in light of the need to fight the global poverty within the confines of MDGs. They felt that the knowledge of MDGs must be a central component of Rwanda?s civic/citizenship education in order to develop a common understanding of the quest to eradicate poverty and spearhead all-encompassing development. The study concludes that foreign aid is at the core of successfully eradicating extreme poverty and hunger, though it must be received with some caution as a number of donor agencies will end up politicizing the concept

The study recommends that there is great need to expose citizens to issues relating to foreign aid,

poverty alleviation and development discourse pupils at a tender age. The study further

recommends the intensification of the training programmes for citizens to be able to handle the

issues linked to aid. Furthermore research is recommended in this seemingly grey area in line with the dynamic aspect of development and education respectively.

LIST OF FIGURES AND TABLES

Figure 4.1 : Gendered perceptions on poverty as Rwanda?s threat to socio-economic development

Figure 4.2 : Perceptions of the impact of Foreign Aid on the Rwandan economy Figure 4.3 : Gendered perceptions of Foreign Aid and dependency

Figure 4.4 : Knowledge of the existence of MDGs in Rwanda Figure 4.5 : Ranking of MDGs according to priority

Figure 4.8 : Relations of the Government of Rwanda and the Donor Community Figure 4.9 : Beneficiaries of Donor Community from 2000-2009

Figure 4.10: Challenges with regards to Implementation of MDGs Figure 4.11: Ranking Rwanda?s main Resources in order of importance Figure 4.12: Composition of External Resources

Table 4.1 : Views on whether poverty is a threat to Rwanda?s socio-economic development by organizations

Table 4.3 : Views on whether Foreign Aid creates dependency on Rwanda by Organization Table 4.4 : SustainabilIIVERIEIRTJUQE$ I3EtQE5 Zto31?sE

LIST OF APPENDICES

Appendix 2 : Approval letter from WUA, BRD and Letter from DFID Appendix 3 : Rwanda Development Partners by Sector

ACRONYMS

DCPETA Decentralization, Citizen Participation, Empowerment, Transparency and

3.1.3 An overview of the existing situation of the Gasabo District as the case study 61

CHAPTER ONE: INTRODUCTION AND OVERVIEW

The instrumental role of foreign aid on Rwanda?s socio-economic development has always been

a topical subject of debate am ong scholars, intellectuals, social scientists and developmentalists

respectively. On one extrem e end, it is argued that foreign aid is not necessary whereas on the

As such, the attainment of the prime goal of the so-called Millennium Development Goals
(MDG 1) «To eradicate extreme poverty and hunger» largely hinges on the foreign support
Rwanda may happen to receive from various corners of the world. What it entails is that the

relativity nature of development may generate m ixed feelings to the extent that people may fail

to arrive at a universal agreement with regard the best way to attain socio-economic

However, it is the conviction of this study to move a strong motion that Rwanda?s socioeconomic development entirely depends on the magnitude at which various stakeholders join hands and aim at eradicating or seeking the

optimum ways to ameliorate poverty in society. It is therefore the focus of this study to make a scholarly inquiry into this seemingly grey area and

ascertain the best possible w ays and strategies to adopt as Rwanda embarks on this critical
voyage (poverty eradication).

Against this background, it follow s that there is great need to establish the viable strategies upon

which poverty can be reduced. One fundamental strategy lies in marrying foreign aid with the available strategies linked to MDGs.

According to World Bank and International Monetary Fund (WB-IMF, 2002) recommendations, one of the ways of realizing this goal is provision of aid to less developed countries (LDCs) by more developed countries (MDCs). Such aid is supported by WB & IMF - directed economic structural adjustment programs. One may underscore the fact that the various programmes will be tailor-made to focus on specific developmental targets hence attainment of socio-economic development in some way.

The pivotal or multi-million dollar question that arises then is: to what extent can such conditional aid contribute to the socio-economic development of the host country in the long run? And to answer this question, one needs to remember what Mushi (1982:09) says about positive aid: that «aid is developmental only if it lays the foundation for its future rejection». That is to say aid is only truly useful if in the long run it promises and guarantees self-reliance and economic self-sustenance to the beneficiary. Otherwise if aid creates perpetual dependence then it is not useful at all in the first place. Thus, the dynamic views associated with foreign aid will eventually make it perceived at varying degrees of usefulness particularly in developing nations.

1.1 Background to the Study

In Rwanda aid has been coming from various quarters, chief among them United Nations Development Program (UNDP) and World Bank (WB) following the genocide. Against this backdrop, the purpose was partly to assist with reconstruction and also to eradicate poverty and hunger, the latter being done under the auspices of the MDGs. This study therefore, seeks to

assess whether such aid has a positive or negative impact on the Rwanda?s socio-economic development by focusing on the particular case of Gasabo District.

Millennium Development Goal Number 1 clearly states that the primary spirit behind all
millennium development goals is to: eradicate extreme poverty and hunger

Millennium Development Goals (MDGs). The target is to reduce by half the proportion of

people living on less than US$1 a day in low and middle income countries - from 28 percent in
1990 to 14 percent in 2015, and halve the proportion of people who suffer from hunger during
the same period (ibid). It may seem that the twenty-five year time-frame has elapsed without any

This however will negatively impact on the entire socio-economic development of Rwanda, hence the need to investigate the circumstances surrounding the present phenomena. One may observe that, to date twenty years have passed without any material indication of success. Only five years rem ain and yet the possibility of achieving this is still a far cry. Over the years, foreign

aid has been fuelled by both political and economic m otivations of the ruling classes in the
western donor nations. A classic example is the United States of America Foreign Aid, the

Marshall Plan [1948-1951] that was aimed at rehabilitating the shattered economies of Western

Europe, at the same tim e containing the international spread of communism. When the balance

of Cold War interests shifted from Europe to the World in the mid-1950s, the policy of containment embodied in the U.S. aid program dictated a shift in emphasis toward political economic and military support for «friendly» less developed nations especially those considered geographically strategic (Todaro, 1983).

Against this backdrop, it follows that the rationale for foreign aid in general should not be perceived from a lay person?s perspective, thus it requires some introspection of some sort. Those who offer assistance primarily consider their chances of benefiting latter even if they commit themselves to some mammoth task as evidenced in the commitment to eradicate poverty. In all cases, during the socialist, colonial and post-colonial periods donor aid was meant to chart the course of globalization and the interests of global financiers; and this makes donor aid suspicious: whether it really stirs sustainable development or it simply serves the economic and political interests of the donor at the expense of host countries. This prompts the need to find out whether poverty alleviation intervention programmes initiated by the more developed countries (MDCs) in LDCs are really addressing the needs of the deserving neediest or not.

Various studies have been carried out around the globe about whether donors are angels of mercy or doom. As already been alluded to, aid has been given to LDCs in the spirit of the eight MDGs which can be summarized as to:

From the summary, it can be argued that all the other goals are essentially subordinate and play a complementary role to MDG 1. It follows that all other goals have a bearing to MDG 1 in one way or the other, implying that to achieve the target of Goal 1 progress has to be made on the other goals as well. The irony that global studies have established regarding the attainment of poverty reduction, however, is that not much progress has been made. Foreign aid on the other side greatly increases the patronage power of recipient governments. As Bauer (2008) notes, "The great increase in the prizes of political power has been a major factor in the frequency and intensity of political conflict in contemporary Africa and in the rest of the less developed world, than developmental response. In this respect, foreign aid may be accused of meddling with the recipient nation?s political issues hence a detrimental aspect from the sceptics viewpoint. Sceptics are always conscious of their sovereignty.

UNDP, (2003), advances that in the 1990s income poverty increased in 37 countries while hunger multiplied in 21 countries. One may underscore the fact that this cardinal admission with regard the prevalence of poverty and hunger justifies the great need for foreign aid in countries like Rwanda. The poorest region in the world, sub-Saharan Africa has the worst affected countries, seconded by Latin America (ibid). Ethiopia, Rwanda, Burundi, Botswana, Kenya and Mozambique fall into this category. They have all been destinations of foreign aid as guided by MDGs. The period under which MDGs for poverty reduction have been evaluated in Rwanda has been repositioned from 1990 to 2000 following the traumatic upheaval of the 1994 genocide. According to IRIN News, (2006) initial progress was very slow with 57% of the population remaining below the national poverty line, assessed in terms of food needs and non-food essentials.

In that year alone, 37% of the population survived on an income insufficient to provide the minimum calorie requirement of MDG 1; and Rwanda experienced one of the highest levels of extreme poverty in the world. To this effect, the correlation between the existence of peace and the subsequent attainment of positive development in a nation is largely evidenced as the so-called genocide had grave and detrimental effects on socio-economic development; hence the capacity of Rwanda as a sole nation without foreign aid became hazy. To make matters worse, neither of these poverty rates had fallen by more than a few points since 2000, despite strong headlines on economic growth in the media (ibid). Indeed, the Gini coefficient¹ measure of inequality increased over that period from 0.47 to 0.51, a relatively high rate for East Africa (ibid).

The implication is that the rewards of growth were not reaching rural households, where 90% of poverty in Rwanda is located. This fact abides in spite of the optimistic view that points to the stable political environment and the availability of generous development aid of the order of $50 per capita per annum coupled with the rewards of a significant debt relief that was issued in 2005 (ibid). The fact that the threat of hunger and poverty are far from over is not even waived by the bumper harvest of 2008 which fended off the worst global food price crisis. Of course the gRheaQPeQ.117Fia.113iQly17FRQhi A17A.1aRQg 17FRQhiF.1iRQ17iQ17i.1A17F13S13Fi.1v17.1R17.1a13QAIRaP 17.1Ke 17FRoQ.1ailA17 IRa.1oQeA. 17$ 17FlD13a17IRFoA 17RQ1713FFRPSUAKIQ1170 ' * 171 17iA1713a.11Fo113.1ed17iQ171.5 Z 13Qd13lA17( FRQRPiF 17 Development Poverty Reduction Strategy (EDPRS) 2008 - 2012 and in its strategic Vision 2020, which sets out the goal of advancing to middle income status by relying less on unskilled agriculture but more on knowledge-based services such as tourism (UNDP/HDRRwanda, 2007).

The Gini Coefficient measures how concentrated incomes are among the population of an economy: the higher the Gini, the more concentrated

incomes are among a few people. The Gini ranges between 0 (indicating income is distributed equally between all people) and 1 (indicating all income in the economy accrues to one person).

The EDPRS results and policy matrix is organised around the 3 EDPRS flagship programs which have been aligned to the three clusters: The economic cluster which covers the Macro Economic and Financial sector and the economic sectors of Agriculture, Infrastructure (Energy, Transport), Private Sector development as well as Environment and Natural Resources management. The Social cluster covers Health, Education, Social Protection, Water and Sanitation, and Youth; And Governance cluster covers the following sector working groups: Public Financial Management (PFM), Justice, Reconciliation, Law and Order (JRLO), Decentralization, Citizen Participation, Empowerment, Transparency and Accountability (DCPETA), and Capacity Building and Employment Promotion (CBEP).

In spite of all this exuberant optimism by the Government, most observers consider that the MDGs target of halving poverty by 2015 is very unlikely to be achieved. There are signs that decentralization of government structures has not progressed as quickly as hoped, and yet this is an important factor in implementing poverty reduction programmes. On the other hand, the government continues to depend on aid for no less than 49% of its 2010 budget (ibid); and this leaves one wondering how far dependence on aid will take Rwanda?s socio-economic development.

In 2004, the Government of Rwanda (GoR) was dependent upon international development assistance to the tune of almost 50% of its overall budget, and over 80% of its development budget. It was receiving over $350 million a year in aid from over 30 bilateral and multilateral donors and a wide range of non-governmental organisations. (Hayman, 2006)

From a dependency theory point of view, this has an impact particularly on the direction of development since the donors may pursue their own socio-political agendas that may filter some ripple effects on the overall economic growth within Rwanda. National policies and programmes aimed at promoting economic growth, social welfare and political change were heavily influenced by external actors: foreign technical assistants were bolstering weak internal capacity within government institutions; policy consultants and advisors were flying in and out of Rwanda?s capital city, Kigali, to help with the preparation of policy papers and evaluations; a sizable community of expatriate aid workers was present throughout the country. All this necessitates the need to evaluate the far-reaching consequences of aid to Rwanda. (Hayman, 2005).

In Kenya and Tanzania, the Swedish aid on rural development had a positive impact in raising the standards of the poor. To this effect, it would follow that socio-economic development within these nations was registered. Radetzki in Word Bank (2005:258) maintains that in Tanzania, Swedish has provided support for industrial forest planting and care, sawmilling and related activities, technical assistance and village afforestation and this began in mid 1969. One may argues that deforestation was a major challenge which if not controlled could have costed the country to the extent that it was going to be difficult to fight poverty. Poverty alleviation is thus central in order to realise full socio-economic development at all cost. Radetzki in Word Bank (2005:258) further posits that in Kenya soil conservation was successful due to aid from Sweden. In this context, it would follow that there is great need to conserve soil if sustainable agricultural production that fight poverty is to be realised. Howell (2003:418) is of the view that foreign aid from British to Agriculture in Kenya enhanced agricultural research. To this effect, it follows that the impact of foreign aid had positive impact on productivity.

Through research new conventional agricultural practices that are geared towards effective fight against poverty are introduced. Johnston, Hobenand Jaeger (2001:279) report that USA foreign aid support to sub-Saharan Africa registered socio-economic development in that the economic aid has been provided for primary development programmes, food aid, and budgetary support under the Economic Support Fund (ESF) as «security supporting assistance». One may observe that, such foreign aid was quite instrumental in aiding to effective and sustainable socioeconomic development. In proposing effective mechanisms for the provision of foreign aid, Lele and Jain (2001:579) on their analysis of aid to African agriculture, argue that «donors should ensure that their assistance programmes in individual countries successfully combine a long term development strategy with the more pragmatic considerations of day to day economic development. To this end, it follows that, such strategies if intertwined with aid provision will effective anchor socio-economic development of a given nation.

In narrating and tracing the impact of foreign aid and its subsequent role in fighting poverty, Tsikata in Devarajan, Dollar and Holmgrain (2001:47) maintain that «From a state of economic collapse, Ghana?s economy rebounded with sustained economic growth during the first decade of the reform. This stellar performance was accompanied by an exponentional increase in aid inflows from both bilateral and multilateral sources. Against this backdrop, it would follow that the introduction of foreign aid enhanced some economic growth, thus socio-economic development is promoted. In a related study, by Molmgrein (2001:101) of Uganda, it was noted that aid in various forms helped to support the generation and implementation of the policy reforms and Uganda. One may suggest that the various policy reforms may have some bearing on the alleviation of poverty at all cost. In this context aid is perceived to be part of development,

hence the need to have it as nations become geared for the collective effort to fight the global poverty. Similarly, in Zambia, Parkner (2001:1020) reports that aid was pivotal in promoting equitable socio-economic development in the area of agriculture, infrastructure, health and education. One may underscore the fact that if all these areas are funded it follows that the impact of global poverty will be minimised at all cost. As Seers (1988), would argue that development entails eradication of inequality, poverty and unemployment. In advancing debates on the impact of aid to African countries, Dambisa Moyo (2002) presents an argument that sometimes aid in Africa is not working and proposed other mechanisms in order to remove or demystify the issue of aid being classified as «Dead Aid».

To this end this brings us to the relativity nature of foreign aid as put forward by the interactionist view that various subjective meanings are attached to social phenomenon (Ritzer, 1996).

1.2 Statement of the Problem

Poverty has been regarded as a social problem that has significantly affected a magnitude of people across cultures. To this end, heated debates have been generated with regards the possible and viable ways of eradicating the problem. However, foreign aid has been proposed as an ultimate solution that can in turn propel the developmental proper shaft in the socio-economic horizons. The problem has thus arisen in the legitimacy aspects with regards the efficacy of foreign aid in enhancing, facilitating or propelling as well as promoting socio-economic development particularly through the eradication of extreme poverty and hunger to zero levels.

Rwanda has an increase in the depth of poverty in its several areas and a deterioration of living conditions at the bottom of the income distribution. As a consequence of rising inequality, Rwanda could have exhausted its ability to reduce poverty rates through economic growth alone. Growing inequality is not only an obstacle to poverty reduction and sustainable economic growth; it could also undermine social peace. The problem would thus be stated: Does foreign

aid have an impact in fighting SRY7TVIQ5EKuCI7TIEC5 FRCs7117CtlyESTRPRt7ISZEC5aVIRFIR-

1.3 Research Questions

1.3.1 What is the effect of poverty and hunger on Rwanda?s socio-economic development?

1.3.3 Do citizens of Rwanda appreciate the introduction of MDGs as guiding principles for poverty alleviation?

poverty and hunger; and how do the beneficiaries evaluate the impact of such foreign aid on the local and national socio-economic development?

1.4 Objectives of the Study

1.4.1 Assess the extent of poverty in Rwanda in general and in Gasabo District in particular following the adoption of MDGs.

1.4.2 Examine the causal relationship between foreign aid and Rwanda?s socioeconomic development.

strategies against its adoption of MDGs framework through foreign aid. 1.4.4 Establish strategies for both donor community and Rwanda for sustainable

1.5 Assumptions of the Study

1.5.1 Poverty and hunger has a number of effects on Rwanda? socio economic development

1.5.4 If effective policies and legislatives are introduced to combat poverty,
Rwanda?s socio-economic development will be attained

1.5.5 If foreign aid assists Rwanda in its poverty program alleviation, there will be sustainable development.

1.5.6 The overall assumption is therefore that: The Superpowers (US and its allies) and financial institutions give aid with inhibiting conditional ties that still determine the nature of development in LDCs such as Rwanda.

1.6 Significance and Justification of the Study

It is envisaged that this study will tend to immensely benefit a cluster of beneficiaries among them the Government of Rwanda, Civil society, the general citizens and other researchers. The Government of Rwanda (GoR) is the intended primary beneficiary of the findings of this research. It is hoped that the findings of the study will help put Rwanda into the driver?s seat and help her devise its development programs and in leading coordination processes. MINECOFIN (2004).

This research hopes to improve the relationship between Rwanda and the donor community so that it becomes mutually beneficial rather than lap-sided as is the case at present. The study shall also motivate and stimulate other researchers hence they will have the intellectual vigour to continuously advance scholarship into this seemingly grey area. In parallel to this diversity amongst donors, the GoR itself responds in different ways to individual donor agencies, in tune with its own perspectives of them and their histories in Rwanda, and on the basis of its own strategic interests. This research seeks to analyse these different perspectives on Rwanda in light of the international consensus on aid effectiveness. It questions the diversity amongst donors and the political factors on both the donor and recipient sides which lie behind the aid relationship.

This study helps in identifying the explicit challenges that Rwanda faces and strategies that could be designed for its socio-economic development through Foreign Aid. In particular the research will sensitize the citizens of Gasabo District to the negative or positive implications of donor aid so that they deal with donor aid carefully.

This conscientization will help them avoid dependency syndromes and to indigenize projects including those that are donor-funded. In a sense they will own their development programs. On the whole, the study will expose some of the shortcomings of the approaches being currently used by the institutions such as United Nations Development Program (UNDP), United States Agency for International Development (USAID), International Monetary Fund IMF, World Bank (WB) among others to improve the Rwanda socio-economic development. The general citizens of Rwanda will turn immensely benefit in that they will have a deeper insight into causes and nature of hunger as well as getting an enlightenment particularly after interacting with the key findings and recommendation of this study.

Finally, the choice of the case study in this research is deliberate - to examine the ultimate impact of foreign aid on the people of Rwanda. It is both an exploratory and explanatory study which examines whether or not foreign aid is a blessing or a curse. If it is a blessing, then how best can it be further localized; if it is otherwise, then what home-grown solutions can be given in place of foreign aid so that either way socio-economic development can be realized?

In the final analysis although the results of this study are confined to Gasabo (Rwanda), the insights into how donor aid can be used sustainably can certainly be useful to all recipient countries in their generality. The motivation of this study to the future researchers, it will reanimate them in depth with the new approaches about the foreign aid and MDGs in LDCs and will add more knowledge to the existing intellectual studies.

1.7 Definition of key terms

1.7.1 Socio-economic development

For the purposes of this study, socio-economic development entails all development frameworks that may meet the social and economic needs of the nation and its general citizens as well as assisting them to deal with their current and future developmental challenges thus leading to attainment of sustainable development at large.

1.7.2 Impact

For the purposes of this study, impact refers to the instrumental role a given phenomena has on something be it positive or negative.

1.7.3 Foreign aid

For the purposes of this study, foreign aid shall be perceived as eternal assistance in kind or cash that is rendered to a developing nation by another country which can come directly or indirectly through donor agencies.

1.7.4 Millennium Development Goals (MDGs)

For the purposes of this study, Millennium Development Goals (MDGs) shall be perceived as quantitative developmental targets that were adopted by different nations in pursuit of the World Bank (2002) recommendations aimed at fighting the high prevalence of the so-called global poverty.

1.7.5 Poverty

For the purposes of this study, poverty shall mean a state of material and non-material deprivation which may be caused by socio-cultural, economic or political factors.

1.8 Delimitation of the Study

In terms of peripheral guides, the study was confined to Gasabo, a district (akarere) of Kigali City, Rwanda. Its capital is Ndera, a village on the outskirts of the Kigali urban area. The district also includes large areas of the city itself, including Kacyiru, Kimihurura, Remera and Kimironko. The district occupies the northern half of Kigali province, which had its boundaries extended under local government re-organization in 2006 (MINALOC, 2006). Gasabo includes major suburbs of Kigali, sections of a ring of hills which surround the city, and some villages to the north and east of those. Rwanda's wealthiest area, Nyarutarama is also in the district, as are the Offices of the President (in Kacyiru) and most of the ministries.

Gasabo district is divided into 15 sectors (imirenge): Bumbogo, Gatsata, Jali, Gikomero, Gisozi, Jabana, Kinyinya, Ndera, Nduba, Rusororo, Rutunga, Kacyiru, Kimihurura, Kimironko and Remera. As such, the results and findings obtained shall be perceived as representative and generalisable too, to other districts not studied Donor activities in all these areas will be explored. Both males and females constituted the respondents in this particular study. The study of aid in the context of hunger and poverty is broad. Conceptually, this study is confined to the study of aid, poverty and development politics. It entails defining foreign aid, poverty and development within the context of MDGs. It entails exploring the complex dynamics and the politics of aid in general and in the localized context of Gasabo, Rwanda.

It entails evaluating, competing perceptions of various actors in the politics of aid and what may be said to constitute aid theory. The timeframe in which the study is confined is 2000 to 2009. Spatially, the study is limited to Gasabo District of Rwanda although literature will cover Sub-Saharan Africa and beyond.

1.9 Limitations of the study

During the course of the study, the researcher experienced a number of drawbacks which included lack of cooperation from respondents, time inadequacy and financial constraints in meeting the budgetary requirements of the study. However, efforts were made to address the constraints. The first constraint was purely logistical. Given that the study was self-funded; the researcher is faced serious challenges of financing travel to Rwanda for data collection as well as financing the training of 10 assistant field researchers.

The second major constraint was the methodological limitation. Given that the study is based on a case study approach, it follows that it inevitably exhibits the limitations of the method. Critics of the case study believe that the study of a small number of cases can offer no grounds for establishing reliability or generalizability of findings. This point is valid when one considers that given the sensitive nature of the research some key informants within the donor community and government offices may deny the researcher access to important documents or information and this will lead to information asymmetry. In light of this, others declined to be interviewed. Thirdly, time factor was a limiting constraint. The fact that the researcher is a mother, student and employee made it difficult for her to rationalise the demands of these roles.

Also related to time was timing. The fact that the research study took place against the background of genocide and genocide trials meant that the subjects of research study were in different emotional states, so much that they could easily provide or offer a political interpretation to the study. In this case chances were that some sensitive members were not forthcoming and forthright with their answers as expected. Such a background threatened the validity of the outcome.

However, to overcome the above limitations there was need for careful planning ahead of time. The planning should take into account use of different data collection techniques such as direct observation, in-depth interviews, questionnaires and focus group discussions in order to improve the validity of data through methodological triangulation. Communication with interviewees and questionnaire respondents should be done on time in order to facilitate meetings. Besides, prior awareness of these limitations should invoke constant sensitivity to their possibility so that due care is constantly enforced.

1.10 Organisation of the Study

This study is structured into 5 main/key chapters. The first one provides the introduction: background to the study, the problem statement, objectives and the conceptual framework of the study. Chapter two presents a detailed review of related literature: the main focus is putting into context the polemics of aid theory in general, in Africa and in Rwanda-Gasabo. The third chapter describes the methodology: the research design and instruments of data collection to be used in the collection of data.

The findings of the research are then described, analysed and collated in chapter four. Chapter five provides a summary of findings as well as recommendations of the study.

1.11 Chapter summary

This chapter has provided the introduction of the study: background to the study, the problem statement, objectives and the conceptual framework of the study, the assumptions to the study, its significance, delimitations and limitations, and the organisation of the study. The following chapter is going to review related literature linked to the problem under study. It shall give an overview of the current situation on Rwanda socio economic development, policy and practice of both Rwanda and donor community.

CHAPTER TWO: REVIEW OF RELATED LITERATURE

2.0 Introduction

This chapter offers a detailed review of related literature. It will further trace the history of the problem against a background of theoretical underpinnings. Ringrose (1986:78) notes that literature review discusses published information in a particular subject area, and sometimes information in a particular subject area within a certain time period. A literature review can be just a simple summary of the sources, but it is usually has an organizational pattern and combines both summary and synthesis. The flow of foreign aid to Rwanda has been a subject of discussion especially following the notorious genocide and its aftermath. To assess the impact of foreign aid on the socio-economic development of Rwanda, there is need to review some related literature.

This chapter deals with the conceptual framework of the study, the theoretical framework, understanding poverty in the context of Millennium Development Goal number one, impact of foreign aid on poverty alleviation (global trends and trends in Africa in general and Rwanda in particular). Finally, the chapter shall further offer implications of the reviewed literature.

2.1 Theoretical Frameworks

Now that foreign aid, development and poverty have been explained in broad terms, there is need to analyze some of the contending theories on the nature of foreign aid. Four theories are hereby selected for some detailed analysis. To this end, this study is principally informed by four major theoretical frameworks namely the Modernization Theory, the Dependency Theory, the

Interactionist Theory and the Feminist Theory. These contending theories on aid provide various windows by which the impact of foreign aid on poverty alleviation and economic development can be objectively assessed.

2.1.1 The Modernization Theory and Foreign Aid

One of the first models used to understand how states and regions started on the path to economic growth was Rostow?s Modernization Theory. Analyses of European growth after World War II indicated a fairly rapid and linear trajectory of economic growth that was built on a simplistic model of saving and investment. According to Rostow?s analysis, modernization takes place in a series of five stages characterized as follows:

Preconditions for take-off into self-sustaining growth such as increased education, manufacturing, and other forms of capital development.

Take-off stage occurs when the economic norms become established at micro, mezzo and macro levels, which lead to

A drive to maturity characterized by economic diversification and increased standards of living.

The final stage is characterized by mass consumption, which drives continued production, technological development, and job growth. (Todaro: 2006: 104)

These stages imply that the rate of growth of GDP is determined jointly by the national savings
ratio and the national capital ratio. More specifically, it says that in the absence of government
control, the growth rate of national income will be directly related to the savings ratio (ibid). The

economic logic of this paradigm is simple: in order to grow, economies must religiously follow the stages; and to achieve the imperatives of each stage, they must concentrate on savings and local and direct foreign investment. Rostow assumed the validity of the primary economic model of growth at the time, the Harrod-Domar growth model (ibid), which was the basis for the savings + investment = growth formula. While intuitively attractive (to the capitalist worldview) and empirically supported at the time, it assumed a linear growth based on the two isolated variables of savings and investment. While such a trend seemed to be the case in Europe after the world wars, Europe?s advantage over other regions (such as Southeast Asia and Africa), is that it already had a pre-existing infrastructure, and a population already educated in the skills and norms necessary for technologized life. Among other factors, it ignores hegemonic consequences of having military, political and economic power at a state/region?s disposal to procure capital external to itself.

This theory assumes that the «Third World» needs Western donation in order to advance. Indeed, one may observe that the discourse of foreign aid is rooted in the Modernization Theory. Modernization theory understands the «underdeveloped» nations of the world as traditional societies. At some point in history all societies were «traditional.» These societies were able to progress to modern social organization through innovation and technological growth, particularly within a capitalist system where capital is privately owned. Capitalism encourages the individual to constantly strive toward improving her product. Growth is promoted by this push for out-performance, while costs are minimized and efficiency promoted. Therefore, just as modernization and capitalism push a nation to modernity, the poverty of the developing nations can be attributed to their failure to innovate, resulting in technological and therefore economic

deficit, and a consequent inability to modernize. Foreign aid, understood as a means to improve the conditions of life in underdeveloped nations, is couched within modernist thought. It is the practical expression of the theoretical premise that modernized nations are morally obligated to assist other nations to transition to modernization Todaro (1981). To this effect, the modernisation theorists would support the idea that third world nations should always look west in order to develop through coping western models of development. Foreign aid may thus be perceived as a rescue package for an affected nation to be freed from hunger and poverty.

This brings us to the major criticisms levelled against the Modernization Theory mainly by Dependency theorists who include Marxists.

2.1.2 The Dependency Theory and Foreign Aid

The debates among the liberal reformers, the Marxists, and the world systems theorists have been vigorous and intellectually challenging over the years. There are still points of serious disagreements among the various planes of dependency theorists and it is a mistake to think that there is only one unified theory of dependency. Nonetheless, there are some core propositions which seem to underlie the analyses of most dependency theorists. Dependency can be defined as an explanation of the economic development of a state in terms of the external influences -- political, economic, and cultural-- on national development policies (Osvaldo Sunkel: 1969: 23). Theotonio Dos Santos (1971:226) emphasizes the historical dimension of the dependency relationships in his definition:

[Dependency is]...an historical condition which shapes a certain structure of the world economy such that it favours some countries to the detriment of others and limits the development possibilities of the subordinate economics...a situation in which the economy of a certain group of countries is conditioned by the development and expansion of another economy, to which their own is subjected.

There are three common features to these definitions which most dependency theorists share. First, dependency characterizes the international system as comprised of two sets of states, variously described as dominant/dependent, center/periphery or metropolitan/satellite. The dominant states are the advanced industrial nations in the Organization of Economic Cooperation and Development (OECD). The dependent states are those states of Latin America, Asia, and Africa which have low per capita GNPs and which rely heavily on the export of a single commodity for foreign exchange earnings. Susanne Bodenheimer (1971). Second, both definitions have in common the assumption that external forces are of singular importance to the economic activities within the dependent states. These external forces include multinational corporations, international commodity markets, foreign assistance, communications, and any other means by which the advanced industrialized countries can represent their economic interests abroad.

Third, the definitions of dependency all indicate that the relations between dominant and dependent states are dynamic because the interactions between the two sets of states tend to not only reinforce but also intensify the unequal patterns. Moreover, dependency is a very deep-seated historical process, rooted in the internationalization of capitalism. In short, dependency theory attempts to explain the present underdeveloped state of many nations in the world by

examining the patterns of interactions among nations and by arguing that inequality among nations is an intrinsic part of those interactions (ibid). Most dependency theorists regard international capitalism as the motive force behind dependency relationships. Andre Gunder Frank (1972: 3), one of the earliest dependency theorists, is quite clear on this point:

....historical research demonstrates that contemporary underdevelopment is in large part the historical product of past and continuing economic and other relations between the satellite underdeveloped and the now developed metropolitan countries. Furthermore, these relations are an essential part of the capitalist system on a world scale as a whole.

According to this view, the capitalist system has enforced a rigid international division of labour which is responsible for the underdevelopment of many areas of the world. The dependent states supply cheap minerals, agricultural commodities, and cheap labour, and also serve as the repositories of surplus capital, obsolescent technologies, and manufactured goods. These functions orient the economies of the dependent states toward the outside: money, goods, and services do flow into dependent states, but the allocation of these resources is determined by the economic interests of the dominant states, and not by the economic interests of the dependent state. But before going into the debate on whether aid does encourage dependency and inefficiency, we need to address a particular misconception: that aid to developing countries, known as official development assistance (ODA), is an act of simple generosity towards poor countries in dire need of capital to invest in education, health, infrastructure, and so forth, and that it comes with no strings attached. Development assistance is neither value-free nor benevolent. It has served and continues to serve the economic, political and strategic interests of

donor countries. This was particularly so during the Cold War period. It is even more evident today. (ActionAid, 2005)

So aid is an instrument, not a gift. For many Western countries and institutions, it plays a key role in their overall strategy to maintain and even expand their influence in Africa. This is particularly true for former colonial powers such as France and Britain, which have used aid to maintain their influence in former colonies, in economic, financial, military and strategic areas. This type of aid does create dependency and it is intended to, since its primary objective is to shore up regimes that are friendly? to Western countries, regardless of the nature of those regimes. This explains, among other things, why a dictatorial and inept regime like Mobutu in the former Zaire (DRC) was kept afloat despite the looting of his country?s resources and the rampant corruption that characterized his regime. Billions of dollars looted by Mobutu are still stashed in Western banks while the Congolese people wallow in poverty (ibid).

Moreover, since the start of the debt crisis, aid dependency has been aggravated by conditions imposed by the IMF and World Bank. Since the 1980s, aid from Western countries has been conditional on recipient countries implementing policies dictated by these two institutions. One may argue that, a typical example is the catastrophic ESAP of Zimbabwe in the 1990s. Even aid from former colonial powers to their former colonies is now conditional on signing an agreement with the IMF, yet it has become clear that these policies have done more harm than good. (Government of Zimbabwe 1991)

The dependency on foreign aid has political as well as economic costs. It is obvious that a country that depends on foreign assistance for up to 40 per cent of its budget cannot control its own policies. Instead, as the IMF and World Bank?s structural adjustment programmes show, donors dictate economic and financial policies, based on their own world view and interests (HDR-UNDP, 2007). The structural adjustment programmes, imposed by the IMF and World Bank, are a reflection of that reality. As already indicated this has worsened the economic crisis and deepened external dependency, while the conditions attached to such multilateral aid are the principal cause of the abject poverty affecting more than half of the African population. Against this background, one may argue that from a dependency theory point of view, the issue of foreign aid is a form of colonialism (neo-colonialism),hence Third world nations will remain entirely dependent on first world nations.

On the whole the Modernization and Dependency theories are macro-theories that evaluate society from a holistic perspective. As such there is no wonder why all of them fail the test of local contextualization; hence the need to look at some micro - theories that can explain the politics of aid at a micro or local level. Two theories have been selected for this balancing purpose: interactionnism and feminism.

2.1.3 Interactionism and Foreign Aid

Symbolic interactionism is a major sociological perspective that places emphasis on micro-scale social interaction. Symbolic interactionism is derived from especially the work of George Herbert Mead. The basic assumption of interactionism is that people act toward things based on the meaning those things have for them; and these meanings are derived from social interaction and modified through interpretation. In other words human beings are best understood in relation

to their environment. Herbert Blumer (1969) who coined the term "symbolic interactionism," set out three basic premises of the perspective:

Humans act toward things on the basis of the meanings they ascribe to those things.

The meaning of such things is derived from, or arises out of, the social interaction that one has with others and the society.

These meanings are handled in, and modified through, an interpretative process used by the person in dealing with the things he/she encounters.

Blumer, following Mead, claimed that people interact with each other by interpreting or defining each other's actions instead of merely reacting to each other's actions. Their response is not made directly to the actions of one another but instead is based on the meaning which they attach to such actions. Thus, human interaction is mediated by the use of symbols and signification, by interpretation, or by ascertaining the meaning of one another's actions. (Blumer 1962). From this analysis of interactionism one can note that the Interactionist interpretation of foreign aid depends entirely on the perceptions of the actors in the aid continuum. These include the donor, the boundary partners in the middle and the recipient at the end of the continuum. It goes without saying that the donor knows why he is donating in the first place; but the point that needs emphasis is that the public can only be made to know what the donor makes public that is, the donor?s explicit motives. However, if the donor has hidden agendas, such agendas can only be guessed by the public, otherwise the ulterior motive remains hidden from the public sphere and the donor is not likely to disavow his hidden agenda in any public forum. Nonetheless, even that hidden agenda remains intrinsically part of the donor?s definition of the aid he releases.

On the other hand, the boundary partners, because they benefit from the aid process, are likely to accept the donors? definition of aid. They are most likely to resist any temptation to see aid in any other light than prescribed by the donor. However, the recipients of aid are likely to interpret aid differently depending on their varied needs. Those in extreme need may see aid as none other than benevolent. They hardly see any dangers of dependency but simply accept the donor as the saviour. On the other hand, those especially educated recipients who may not be in dire need of such aid or whose political portfolios are threatened by their subjects? allegiance to new saviours are likely to treat aid with suspicion. The local intellectuals may take the suspicion further to attaching such aid with ulterior motives. The point that needs emphasis, though, is that foreign aid is interpreted differently by different actors owing to different needs and sensibilities.

2.1.4 Feminism and Foreign Aid

Unlike interactionism, Feminism offers an explanation of how economic models, policies and budget frameworks and processes have not adopted a gender perspective, and how this has caused women to bear the brunt of poverty. The theory deplores that economic models, policies and budgetary frameworks that are adopted by different African governments and institutions often ignore the lived realities of women; but that men largely dominate and control not only the means of production but also economic decision-making. Most nations in Sub-Saharan Africa have dual economies that consist of both formal and informal sectors. Men are dominant in the formal sector, while women dominate the informal and communal sectors. There is a discernible trend in Sub-Saharan Africa that economic and development policies target the formal sector, marginalising the informal and communal sector where women mostly participate.

The Millennium Declaration, signed in September 2000 at the United Nations? Millennium Summit, commits the member countries «to promote gender equality and the empowerment of women, as effective ways to combat poverty, hunger and disease and to stimulate development that is truly sustainable. (UN, 2000). Accordingly, the greater part of women?s contribution to the economy is not counted and not truly reflected in national accounts. Similarly, women?s role in influencing and participating in economic policy formulation is side lined, leaving them to deal with the impacts of poverty and marginalisation. (Lucy Makaza-Mazingi, 2009).

The feminisation of poverty is a phenomenon where poverty is viewed as disproportionately

affecting and impacting on women more than it does on men. The phenomenon has been linked, firstly, to a perceived increase in the proportion of female-headed households (FHHs) and, secondly, to a rise of female participation in low returns urban informal sector activities, particularly in the context of the 1980s? economic crises and adjustments in sub-Saharan Africa and some Asian countries. The feminisation of poverty can be viewed from three distinct standpoints namely (ibid):

This raises questions as to whether Southern Africa can meet the Millennium Development Goal (MDG) number one: of reducing poverty by half by 2015. In Zimbabwe, the Poverty Assessment Study Survey-PASS II (2003), revealed that poverty remains higher among female-headed households than male headed households. The Botswana women?s NGO forum notes that 55

percent of the population in rural areas in the country earns income below the poverty line and female-headed households make up 41 percent of those living in poverty as opposed to 34 percent for male-headed households. A survey carried out in Zambia revealed that 50 percent of female-headed households were classified as very poor compared to only 27 percent of the male-headed households (ANSA, 2006).

A noticeable trend in Southern Africa is the dominance of men in most of the occupations associated with high responsibility, job security, dignity, high earning and social status, while women are relegated to the low-paying jobs thus increasing inequality between women and men. In addition, the African Development Bank?s (ADB) (2008) Gender Policy notes that feminisation of poverty is directly related to the absence of economic opportunities, the lack of access to economic resources (including credit, land ownership and inheritance), and the lack of access to education and support services.

Despite the signing of the 1995 Beijing Declaration, the action plan on women?s empowerment, and the many declarations and debates on gender equity in Africa, the women in Southern Africa still reflect the ugly face of poverty statistics. The recently adopted SADC gender protocol recognises the feminisation of poverty as one of the threats to the fragile gains made towards gender equality over the past decade in the areas of law reform, representation in politics and decision-making, and some strides in education, with certain African countries reportedly achieving some of the MDGs on gender- related issues. The traditional discipline of economics, which still to a large extent implicitly informs the current economic modelling and discourse in Southern Africa, has relied on a number of critical assumptions about women and their roles (ibid).

There is now a shared understanding within the development community that development policies and actions that fail to take gender inequality into account and fail to address disparities between males and females will have limited effectiveness and serious cost implications. For example, a recent study estimates that a country failing to meet the gender educational target would suffer a deficit in per capita income of 0.1-0.3 percentage points. (Dina Abu-Ghaida and Stephan Klasen, 2002). One may observe that, by the same token the distribution of foreign aid has been heavily skewed in favour of men over the years mainly because most donor organisations are controlled by men who happen to occupy higher positions within these organizations.

One may argue that to date, women are not considered a human factor in decisions on aid for economic and social development; hence women and children remain victims of the poverty trap. Todaro, (1993) is of the view that development is a multi-dimensional concept which can be realized through promoting gender equity. Burvic and Gupta, (1994) note that «where women are targeted with resources it is often assumed that benefits accrue directly to them and also to their children, to a greater extent than resources targeted at men.

2.2 Conceptualizing aid, development, poverty and hunger

Aid is simply the transfer of money, goods and technical assistance from a donor to a recipient. According to Todaro, [1981], foreign aid is any official development assistance or "any flow of capital to least developing countries...» and its objective should be characterized by "concessional» terms, that is, the interest rate and repayment period for borrowed capital should be "softer" [less stringent] than commercial terms". One may observe that, Todaro?s conceptualization of aid in this case takes for granted that the impact of any such aid is

development; but unfortunately it misses the point that development is relative. On one dimension, development depends on the perspective of the beholder; in which case the donor, the recipient of aid and the independent observer all judge the impact of aid from different angles and with different sensibilities. Against this background, the Government of Rwanda and its Development Partners have put in place a number of inter-linked forums for dialogue on aid coordination at different levels. At the 2006 Government of Rwanda and Development Partners Meeting, Rwanda?s donors presented a joint statement of their intent with respect to the implementation of Rwanda?s Aid Policy and the Paris Declaration. As part of this, donors agreed to adopt the 2010 targets above as individual targets, recognizing that collective achievements against the Paris targets rely on the efforts of individual partners. Central to in-country dialogue around aid effectiveness are a number of key forums that bring together government, donors, civil society and the private sector at a number of levels:

On another angle one may argue that the concept of aid may be best understood from a historical perspective. During colonialism, European colonial powers were concerned with the economic development of the territories they occupied, hence they often released economic assistance to their proxy governments in the occupied territories. Whether the beneficiaries of the assistance were the minority ruling white elite or the majority ruled Africans was not an issue for serious auditing by aiding cosmopolitan governments. Mikesell (1983: 1) posits that even after independence «much of their economic assistance to the new independent states formed after World War II constituted a continuation of their development and other economic assistance during the colonial period».

On the other hand, the World Bank charter of 1944 argues that the Developed Countries had a dual function of promoting the reconstruction of the war-torn countries, developed and developing, and of promoting economic development in the less developed countries (ibid). The concept of development assistance as enshrined in the Articles of Agreement for the World Bank aims at promoting the flow of private international capital in the form of both loans and direct investment investments to developing countries (Mikesell 1983). To this end, from a Utopian perspective, Aid would best be defined as loan, grant and technical facility advanced by a Donor nation to a Recipient sovereign state with neither political nor economic motivations but to promote the reformative and legacy reclamation efforts of the latter [Recipient] through facilitation of the development of democratic processes and deepening integration based on principles of mutual cooperation, non-interference and respect for sovereignty. Nonetheless, political and economic interests have often overshadowed what has often been projected as purely humanitarian. And this reality is fore-grounded by the different perceptions of aid by the

Donor and the Recipient; prompting one to proceed with further clarification of what development (and economic development in particular) really entails for the two parties? perspectives. Webster?s Dictionary (1990:248) advances that development means "bringing to more advanced and effective state or to cause to grow and expand». In this regard, this classical definition when adjusted to the contemporary debate would be conceived as an all-encompassing and multi- faceted process characterized by both qualitative and quantitative changes in the diverse sectors of human society, namely social, economic, political, cultural, scientific and technological, environment, that inherently lead to overall improvement of human and community welfare, as well as deepening of mutuality and cooperation within and between communities.

From time immemorial, economic development on the other hand is often taken in a narrower sense as development of infrastructure and institutions which prop the economy. Such a definition is confined to one or two variables yet, as a process, development itself is really a complicated, holistic and complex reality. For this reason social factors are as important as economic factors in understanding development and this calls for a mutual conceptualization of the imperatives of the politics of aid for this purpose which is regrettably missing as the nature of and processes of aid are dictated by those who offer the aid, hardly with either consultation or local participation of the intended beneficiaries. This makes the recipient a passive pawn in the scheme of the aid process. In the final analysis it is the donor who defines the problem and designs and provides his own solution for a perceived problem in the recipient; thus the intended resultant development is logically not that of the recipient but of the donor who also defines the progress. (Andrew Sikula, 2009).

Hunger and poverty are often the main causes cited by donors (acting as senior brothers) as the main causes of their humanitarian intervention. http://www.worldbank.org/prem/poverty. These are again defined as crises by the donor, and whether these are priority one for the beneficiary or secondary to other pressing needs is a question donors ever address. Everything falls within the blueprint plan of the donor. Even the way hunger and poverty are defined is equally circumscribed.

Poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able to see [afford medication] the Doctor. Poverty is not being able to go school and not knowing how to read. Poverty is not having a job; it is fear of the future, living one day at a time. Poverty is losing a child to illness brought about by unclean water. Poverty is powerlessness, lack of representation and freedom (ibid). It is from this understanding of poverty and hunger that the Millennium Development Goals (MDGs) were drafted by the United Nations, the mother institution to the World Bank and International Monetary Fund. The MDGs took tangible form in the Millennium Declaration of world leaders in September 2000. The declaration reflects an inspirational agreement that the global community will unite to eliminate the scourge of poverty in a finite time frame (Marshall and Keough: 2004:4). In this context, the Millennium Development Goals? (MDGs), Goal Number 1 is of particular interest to this study. The goal targets :«To eradicate extreme poverty and hunger, by halving the proportion of people living on less than $1 a day and those who suffer from hunger» (Todaro, 2006: 24). One may observe that, although goal number one is the most explicit about poverty alleviation, all of them also contribute in part to the overall elimination of poverty and want in spirit.

Chambers (1983), is of the view that poverty constitutes: lack of assets (inadequate stocks, food and income), physical weakness and sickness, isolation, vulnerability to contingencies (insecurity) and powerlessness. Jazairy et al cited in Shepherd, (MEMIEIEI1 1;GEYLEImMI\E definition by identifying four types of poverty: interstitial poverty (pockets of poverty surrounded by wealth), material deprivation combined with isolation and alienation (peripheral poverty), overcrowding poverty in areas of population pressure, and traumatic/sporadic poverty - temporary poverty into which the non-poor may be thrown by crisis (e.g. war, drought and famine). One may suggest that, these categories, however, do not seem to encompass those who are chronically poor and those in absolute poverty, neither do they focus specifically on poverty in a rural setting such as part of Gasabo district.

Ribas and Machado (2007) further observe that chronic poverty can be analyzed in terms of absolute or relative deprivation. In pursuit of a plausible definitional view, Mickay and Lawson (2002) provide characteristics of chronic poverty which include, inter alia, lack of human capital, the demographic composition of households, location of residence, lack of physical assets and low paid labour. On the other hand, transient poverty is characterized by family size, government transfers, and seasonality of economic activities, migration and life cycle events. As a matter of fact the distinction between the two implies that public policies cannot be uniformly applied (Gaila and Deolalikar, 1993; Barrientos et al 2005). Similarly, Kurien (cited in Chambers S.EEI\EGeIVARQERIESRYIBWEI\: EEKEE\RF1R-economic phenomenon whereby the resources available to a society are used to satisfy the wants of the few while the many do not have even WILEba\IFEKTeG\ Emet?. ETKI\EGIIIMIRnEi\Eal\R EIMatiYIEinEMMI.

2.3 History of Foreign Aid in Rwandan Economy

Rwanda is generally an extremely poor country with few natural resources and little industrial production. For 1999, Rwandan GDP is estimated to have been RwF 641.0 billion, or US$ 1.92 million, and RwF 712.2 billion for 2000, or US$ 1.83 million. The real change in Rwandan GDP is estimated by the Economist Intelligence Unit to have been 5.3% for 1999. In 1999, annual per capita income was US$ 189. Debt servicing has since 1994 been a major cause for a balance-ofpayments deficit, but the most recent figures available seem even more aggravating. (André et al., 2001). In this respect it follows that this should be supported by foreign aid in order to realise socio-economic development.

Similarly, based on IMF, World Bank, and national data, the Economist Intelligence Unit estimates the latest available debt figures as follows: the total debt had risen to US$ 1.3 billion in 1999, and debt servicing to US$ 48.2 million, representing 69% of the value of the US$ 70.8 million merchandise exports. Foreign investments account for more than 90% of total gross fixed investments, and due to the huge inflow of hard currency from donors, the Rwandan Franc has been reasonably stable despite the low exports. (Economist Intelligence Unit, 2000). One may observe that, there is a huge economic and social divide between the countryside and the urban areas. Economically, as well as seen from a wider developmental point of view, the urban areas-in particular the capital Kigali - are far better off in all respects. According to the Economist Intelligence Unit, Kigali is thus «home to 94% of Rwanda's banks, 96% of its industry, 65% of the civil service, 80% of the informal sector and 90% of the hotel space. The city also has the most reliable supplies of water, electricity and telephone lines.»

About 90% of the Rwandan work force is employed in the agricultural sector, and the productivity in this sector is generally low. Agricultural production collapsed with the Genocide in 1994 and only started to recover two years later, although much of the improvement is because more areas are being cultivated. Also, the south-western part of the country has experienced drought and famine. Formal and informal unemployment is widespread all over the country, which is reflected in the fact that an estimated 70% of the population lives below the poverty line, and the vast majority of this group are from the countryside. Tea and coffee are the main export items, comprising 80% of the value of total exports in 2000.

Rwanda earned US$ 68.4 million from exports in 2000, up by US$ 7.2 million from 1999, in spite of a drop of nearly US$ 4 million in the value of its main export, coffee. Tea accounted for this improvement, since tea exports were US$ 8.5 million higher in 2000 than in 1999 because of increased production. The commodity export from Rwanda is essentially made up of agricultural goods and natural resources. The total amount earned is around one million dollar per year Rwanda is not really integrated into the global economy. Rwanda earned 219 million US$ in 2002 from export of goods and nonfactor services. This export revenue only constituted 7.65% of GDP in 2002. Little hope is in sight in this regard, since Rwanda?s export capacity and ability to attract foreign investment capital is generally regarded as low and likely to remain so for at least a decade. However, imports reached US$ 245.9 million in 2000 and thus by far outweighed exports, and the balance of payments situation has not eased in the last few years (Ibid). The present focus on the Millennium Development Goals (MDGs) has reignited the debate on the need for more aid to developing countries to help them meet the MDGs by 2015.

However, this has inevitably rekindled the parallel debate as to whether more aid is really the answer. Will extra money simply shore up inefficient governments and feed government corruption? One response to this is to say we must bypass government and make money available directly to NGOs and other organizations. At the same time, others claim that what is needed is not more aid, but a fundamental transformation of international power relationships, especially reform of international trade and finance rules to allow African and other developing countries to sell their goods and services at a fair price.

Private and public transfers, which in 1999 covered 64% of the current deficit, are also diminishing. As a result, the balance of payment deficit in 1999 went beyond US$ 100 million for the first time after 1994 power-takeover and the trend is forecast by the IMF to continue. However, net foreign assistance has been declining and is unlikely to exceed US$ 180 million in 2001 and US$ 170 million in 2002, according to the Economist Intelligence Unit, partly due to the Rwandan presence in the Congo and partly due to the termination of the ?emergency period? following the 1994 Genocide.

2.3.1 Aid Effectiveness in Rwanda

During the last decade there has been a heated debate about the relationship between economic growth and foreign aid. Knack found that there was an adverse effect of aid in so far as during the period 1982-95 it increased corruption and lead to a deterioration of bureaucratic quality and the rule of law. Aid thus seems to be a weak policy to reduce corruption (Knack, 2000). So while aid has little impact on governance, governance has a large impact on the effectiveness of aid.

Aid effectiveness has been seen the return to favour of programme aid instruments, and particularly the rise of budget support. There has been a shift from discrete projects to much greater coherence of aid instruments, whether programme or project, around a government-owned policy. The Rwandan experience raises a wide range of questions about new? programme aid and in particular budget support which is inherently tied up with the concept of recipient ownership and has been the stated preferred aid mechanism of the GoR for many years. Only a limited number of donors provide general budget support in Rwanda, namely the IFIs, the European Commission, the UK and Sweden. (Hayman, 2005)

The majority of bilateral donors continue to favour the project mechanism, which raises quite different effectiveness issues. The conditionality of projects is more technical; they induce higher administrative burdens and are not necessarily tied to GoR priorities. Hence, it is too simplistic to consider projects to be a poor instrument and budget support a better one; what matters for both instruments is the behaviour of donors and how they interact with and respect the GoR as recipient (ibid.). Development Partners have made strong progress in their efforts to reduce transactions costs in 2007: The Netherlands is phasing out cooperation in health and social protection; Sweden and the Netherlands are acting as silent partners in education; and Germany, the Education for All Fast Track Initiative and the Netherlands are beginning to disburse sector budget support. However, development assistance remains highly fragmented with some Development Partners active in 5 (of 15) sectors and each sector hosting an average of 9 Development Partners. The health sector, for example, hosts 16 Development Partners and receives 12% of ODA, while infrastructure has 11 Development Partners (across energy, transport, and water) but also 12% of ODA. Education, on the other hand, only receives 5% of ODA and hosts 15 Development Partners, not including silent partners. (Willium, 2001)

The present Rwanda government seems to be committed to the reform process, and the government would by this criterion be a good candidate for aid, (SIDA, 2005). As the Government?s development priorities evolve it will be important to have an even distribution of donor activity across sectors and to take full advantage of donor comparative advantage. Comparative advantage refers to those areas in which a particular Development is activated. Partner is considered to be most effective in relation to other areas where that Development Partner is engaged. All these, because there is a need to accompany the 2008 Paris Declaration Monitoring Survey, as a first-step to determine where Development Partners are, or could be, most effective. (MINECOFIN, 2007)

2.3.2 The Politics of Official Development Assistance on Rwanda

The OECD?s general definition of official development assistance (ODA) applies here: aid as grants and loans with at least a 25% grant element, provided by OECD and OPEC member countries and multilateral agencies, and which are administered with the aim of supporting development and welfare in the recipient country. It is important to stress that the OECD definition of ODA does not include military assistance although Donors view aid as having a positive effect on both economic development and the political level. Economically, in particular the Bretton Woods Institutions argue that a structural adjustment programme, including a slimming of the public administration, privatization of public companies and a reduction in military spending, will benefit the economy as a whole and thereby also the poor people in Rwanda. Politically, donors argue that the economic reforms are an essential element to stabilize the socio-political environment in Rwanda and the Great Lakes Region. (OECD, 2000).

In other words, aid is seen as a means to bring lasting peace to the region. The EU has followed the line set out by the Bretton Woods institutions and is a major donor of development aid, despite official protests against the continued war in the Congo. For instance, the European Commission in June 1999 issued a communication to the EU Council of Ministers and the EU Parliament reviewing the EU's economic cooperation with countries at war in the Congo. The report was intended to avoid the misuse of development funds provided by the EU for military purposes. (André, Catherine, and Tierens, Michel, 1999).

Rwanda is generally highly dependent on aid in virtually all sectors. For instance, the country received US$ 372.9 million in Official Development Assistance (ODA) during 1999, most of which (287.4 mil US$) comprised grants provided by bilateral donors. However, net foreign assistance has been declining and is unlikely to exceed US$ 180 million in 2001 and US$ 170 million in 2002 (Economist Intelligence Unit, 2001). Donors appear to have decided to refrain from investigating whether conditions are being respected, instead quietly ?believing? in the good intentions of the Rwandan government? all because the local leaders pander to the whims of the unofficial agenda of the West. This explains why the Bretton Woods institutions have steadfastly backed questionable statistics put forward by the Government of Rwanda? and even continued to publish manipulated and incompatible figures by the Government of Rwanda?.

2.3.3 The World Bank and UNDP Poverty Indicators-Indices

According to the World Bank (2006), since 1990 extreme poverty in developing countries has
fallen from 28% to 21%. However, over the same period the population grew by 15% to 5
billion, leaving 1.1 billion people in extreme poverty. The World Bank also estimates that if

economic growth rates are sustained, global poverty will fall to 10%, but millions of people will still be trapped in poverty especially Sub-Saharan Africa due to: lack of employment, depletion of environmental resources, corruption, conflict and mis-governance (waste of public resources).

The UNDP on its hand has characterized poverty in a similar way but measures the various dimensions of deprivation using a series of composite measures. It has produced the Human Development Index (HDI) and a number of variants. The basic HDI is an average of indices of what the UNDP considers to be uppermost aspects of human development: health as measured by life expectancy at birth and maternal mortality, educational attainment as measured by adult literacy, material standard of living measured by GDP per capita (in dollars), unemployment, crime (to some extent), and freedom and human rights. WB Poverty Reduction Handbook (1983), notes that «poverty is conventionally measured by the income or expenditure level that can sustain a bare minimum standard of living. Poverty can be measured in relative or absolute terms. However, poverty is not just measured by income and consumption above: Health, life expectancy, access to clean water, and education are central dimensions of welfare».

On the other dimension, the World Bank Report of 1991 focuses on income and social indicators. The World Bank indicators are identified from a general analysis of country characteristics combined with the poverty profiles. One may suggest that they show incomes and living standards of the poor. They are based on the income-earning opportunities of the poor as producers and employees and the availability and prices of pertinent consumption goods. Smallholder farmers are the major targeted poverty group. Their main source of income is the sale of agricultural produce. Their incomes depend on the prices of the crops compared with the

prices of the goods they consume. Social sector expenditures, broken down to show expenditures on services used by the poor are deemed important poverty indicators. The assumption is that «there is an overall positive relationship between levels of social indicators and social expenditure shares». However, the problem with this analysis is that it is teleological - expenditure in developing countries particularly in Rwanda is not necessarily an objective response to an objectively observed need to alleviate poverty. For this reason to assume that government expenditure on social amenities is in relation or response to an objectively assessed need for poverty alleviation is to be naïve. In reality government expenditure has more to do with its own affordability rather than a reaction to a well-researched poverty need.

The World Bank values children?s health and nutritional status as a key indicator. It uses three leading indicators: the under-five mortality, immunization, and malnutrition. The under-five mortality rate is seen as the best indicator of «changes in health status»; more so because it is not susceptible to cultural biases. However, there is a problem of the availability of such data. Some communities hardly visit hospitals due to religious beliefs and others do not have any community health officers who would record such deaths. Lastly, the World Bank focuses on the critical role women play in the survival strategies of the poor. Their status and access to services are important indicators of family well- being. Priority indicators include: female/male life expectancy at birth, totality fertility rate, and maternal mortality rate. The first category is based on the assumption that «normally women outlive men» (Ibid p.26). The second category represents the number of children a woman would bear if she were to reach the end of her child bearing years. The assumption here is that there is «a correlation between fertility and poverty».

This assumption requires more scientific evidence to prove. The last category, though, seems quite obvious - that maternal mortality is an indication of poor women?s access to basic health services. In patriarchal societies female literacy could also be a measure for it is directly linked with welfare benefits. One may say that the World Bank indicators of poverty can therefore be summarized as follows: income and consumption, employment, health and nutrition, life expectancy, mortality rate and literacy. All these can be further collapsed into income, health and social indicators. In the final analysis Mkandawire (1999) defines poverty in more embracing terms than Chambers and Kurien, and his definition can thus be used as a standard definition for this research. For his perspective, poverty is «a condition characterized by serious deprivation of basic needs in terms of food, water, health, shelter, education; and a lack of means and opportunities to fulfil these basic needs.

In his study of rural poverty in Malawi in 1993, he identified the following as the indicators of poverty: low income levels, unequal distribution of incomes, high unemployment rate, household food insecurity, high mortality rate, poor water and sanitary facilities, low literacy rate and environmental degradation Mkandawire?s study is a basic needs approach to the understanding of poverty which clearly combines the UNDP and World Bank indicators of poverty.

These Organizations? list of indicators serves as a convenient point of entry into the discussion of foreign aid and impact on poverty alleviation in Sub-Saharan Africa; but before such a detailed discussion there is need first to analyze various theories attempting to explain the motivations and nature of foreign.

2.4 Foreign Aid and Economic Development in LDCs

2.4.1 General Global Trends

Foreign aid is usually associated with official trend development assistance, which in turn is a subset of the official development finance, and normally targeted to the poorest countries (World Bank, 1998). One may present a question then: How does foreign aid affect the economic growth of developing countries? This is a question which has always drawn the attention of many scholars over time may not be answered to universal satisfaction. Papanek (1972) finds a positive correlation between aid and growth. Fayissa and El-Kaissy (1999) show that aid positively affects economic growth in developing countries. Singh (1985) also finds evidence that foreign aid has positive and strong effects on growth when state intervention is not included. One may suggest that foreign aid has an effect in eradicating poverty in general.

Snyder (1993) shows a positive relation between aid and growth when taking country size into account. Burnside and Dollar (2000) claim that aid works well in the good-policy environment, which has important policy implications for donors community, multilateral aid agencies and policymakers in recipient countries. Developing countries with sound policies and high-quality public institutions have grown faster than those without them, 2.7% per capita GDP and 0.5% per capita GDP respectively (World Bank, 1998).

By contrast, other people find foreign aid has negative impact on growth. Knack, (2000) argues
that high level of aid erodes institutional quality, increases rent-seeking and corruption,
therefore, negatively affects growth. Easterly, Levine and Roodman, (2003), using a larger

sample size to re-examine the works of Burnside and Dollar, find that the results are not as robust as before. Gong and Zou, (2001) show a negative relation between aid and growth. Pedersen, (1996) argues that it is not possible to conclude that the foreign aid has a positive impact on growth. Morrisey, (2001) claims that aid works well conditional on other variables in the growth regression; while other authors find no evidence that aid affects growth in developing countries. By and large, the relation between aid and economic growth remains inconclusive and is worth being studied further.

According to the Modernization theory, aid is found to have a positive impact on economic growth through several mechanisms in that, aid increases investment , aid increases the capacity to import capital goods or technology , aid does not have an adverse impact on investment and savings, aid increases the capital productivity and promotes endogenous technical change (Morrissey, 2001). Papanek (1973), in a cross-country regression analysis of 34 countries in the 1950s and 51 countries in the1960s, treating foreign aid, foreign investment, other flows and domestic savings as explanatory variables, finds that foreign aid has a substantially greater effect on growth than the other variables. He explains that «aid, unlike domestic savings, can fill the foreign exchange gap as well as the savings gap. Unlike foreign private investment and other foreign inflows, aid is supposed to be specifically designed to foster growth and, more importantly, is biased toward countries with a balance-of-payment constraint». He also finds a strong negative correlation between foreign aid and domestic savings, which he believes co-contribute to the growth performance.

Fayissa and El-Kaissy, (1999) in a study of 77 countries over sub-periods 1971-1980, 1981-1990 and 1971-1990, show that foreign aid positively affects economic growth in developing countries. Using modern economic growth theories, they point out that foreign aid, domestic savings, human capital and export are positively correlated with economic growth in the studied countries. This is consistent with the economic theory of foreign aid, which asserted that overseas development assistance accelerates economic growth by supplementing domestic capital formation (Chenery and Strout, 1966). Between 1980 and 1989, the World Bank and the IMF gave an average of six adjustment loans to each country in Sub-Saharan Africa, and almost as many to the countries of Latin America, Asia, Eastern Europe, North Africa and the Middle East. A similar strategy would be tried again in the 1990s during the second Mexican debt crisis of 1994-1995 and then again two years later, after the East Asia crisis of 1997-98. The operations were successful for everyone except the patient. There was much lending, little adjustment, little growth and little poverty reduction in the 1980s and 1990s. As the World Bank President Barber B. Conable noted in his Foreword? to the World Development Report of 1990?253 (WDR1990): «...for the poor in the poor countries the 1980s was a lost decade». Easterly (2001). In this respect it follows that foreign aid can be subjectively construed and this confirms the interactionist view.

Snyder, (1993), taking country size into account, finds a positive and significant relationship between aid and economic growth. He emphasizes that «previous econometric analysis has not made allowance for the fact that larger countries grow faster, but receive less aid». He also claims that donors favour small countries for a number of reasons.

First, donors who are seeking support from recipient countries find it better to provide aid to many small countries than to focus on just few large countries. With the same amount of aid, the proportion of aid over GDP will be bigger in small countries compared to that of larger countries and as a result, give them more credits. Second, there is pressure on multilateral donors to deliver aid to all member countries and due to their feasible project size, small countries tend to receive more aid than they expected. Third, small countries tend to have historical colonial relations with donor countries, which are somewhat influential to donors? aid giving decisions. The last reason is that trade normally has larger fraction of GDP in small countries than in big ones and therefore, these countries may be gaining more weight in donors? assessment.

On the other hand, persuaded by the Dependency Theory, Knack (2000), in a cross-country analysis, indicates that higher aid levels erode the quality of governance indexes, i.e. bureaucracy, corruption and the rule of law. He argues that «aid dependence can potentially undermine institutional quality, encouraging rent seeking and corruption, fomenting conflict over control of aid funds, siphoning off scarce talent from bureaucracy, and alleviating pressures to reform inefficient policies and institutions». Large aid inflows do not necessarily result in general welfare gains and high expectation of aid may increase rent-seeking and reduce the expected public goods quality. Moreover, there is no evidence that donors take corruption into account seriously while providing aid (Svensson, 1998). The aid conditionality is not sufficient and the penalties are not hard enough when recipient countries deviate from their commitments. In fact, there are incentives for aid donating agencies to disburse as much aid as possible. This hinders the motivation of recipient countries and raises the aid dependency, which in turn distorts their development. Other scholars believe that different types of aid have different impacts on growth.

In a country analysis of Cote d?Ivoire from 1975 to 1999, Ouattara (2003) categorizes foreign aid into project aid, program aid, technical assistance and food aid. Using a disaggregation approach with auto regressive techniques, he finds that (i) project aid displaces public savings, impact of program aid is almost neutral while technical assistance and food aid increase public savings and project aid and (ii) to a lesser extent, program aid, worsen the foreign dependence of Cote d?Ivoire while technical assistance and food aid reduce the gap. However, the region is still facing economic and social problems, among which the most serious one is the unemployment, estimated at about 15% of the workforce.

There are twice as many jobless young people as in some countries compared with regional average, requiring the creation of 4 million jobs a year in the next few years in order to accommodate new entrants into the labor market. The Iraq war and the ongoing Palestine-Israel conflict also had a negative impact on the economic performance of the region in 2002. As a result, regional economic growth fell from 3.2% in 2001 to 3.1% in 2002 with continuing declines of investors? confidence, exports and tourism.

2.4.2 Foreign Aid and Economic Development in Sub-Saharan Africa

World Bank records (2000), show that Africa has continued to make progress in many areas. Sixteen out of 47 countries achieved on average more than 4% growth over the last decade. Investment and trade trends have been steady. Net foreign direct investment (FDI) to Africa rose to $6.8 billion in 2001 but was heavily concentrated in oil-exporting countries and South Africa. Africa had the highest returns on FDI, in the world, and the flow of workers? remittances back to

the continent doubled in only two years, reaching $4 billion in 2002. Nevertheless, the continent continues to face enormous development challenges. Half the population lives on less than $1 a day. The share of poor population remains unchanged over the period 1987-1998. This is the region with lowest income per capita and highest population growth. Lack of safe water, HIV and AIDS and political conflicts are the burning issues of the region. Overall GDP growth is roughly 3%, almost equalling to the population growth. Even though the donor community has been providing huge aid amount to this region, its economic performance is still very poor.

As the matter of fact, the aftermath of colonialism is more serious in Africa than anywhere else. Sub-Sahara Africa is especially hindered by its tropical location, high prevalence of malaria, small portion of people living near the coast, and low coastal population density (Gallup, Sachs and Mellinger, 1999). Weak institutions, poor economic endowment, widespread corruption and various ethnic, political and religious conflicts are holding up this region for long time.

Africa is especially vulnerable to terms of trade shocks, famines, political conflicts, drought and floods (Morrisey, 2001). It is found that African nations have aid-to-GNP ratios more than ten times that of Latin America or East Asia, but still suffer inferior economic performance. Ironically, within Africa, countries with poor economic policies have received more aid per capita than those with responsible policies (Graham and O?Hanlon, 2001). In a distorted environment of Africa, if donors just simply provide aid with the same uniformed conditionality like elsewhere, the failure is inevitable. Zambia has received such a huge amount of aid, yet the income per capita is only around US$600, not US$20,000 as expected (World Bank, 1998).

Nigeria, Tanzania may also be examples of failures. Even though there some success stories, namely Botswana, Mauritius, Ghana, Ethiopia, Rwanda, Mali and Uganda, they account for such a small number out of aid recipient countries in the continent. The major cause is that donors do not favour good policy countries and penalize the poor performers. Consequently, the aid dependency is getting more and more serious. Widespread corruption and fungible aid also make the situation worse. Obviously, the question lies not in the quantity of aid but in its effectiveness, which remains ambiguous. As Mushi (1982:09) says about aid in Tanzania, that aid is true developmental only if it lays the foundation for its future rejection?, aid in Sub-Saharan Africa can hardly be called so given the myriad politics around aid which invite greater concern than arouse interest in the positive claims that donors heap on aid. The Arusha Declaration sums up the Tanzanian experience with aid. The Declaration unequivocally warns that it is stupid for Tanzanians to imagine that they would rid themselves of their poverty through foreign financial assistance rather than their own resources?. (ibid: 13).

The message is loud and clear: that foreign aid does not lead to sustainable development as it serves the interests of the donor more than the recipient. However, this does not mean that NGOs and other donor institutions cannot bring anything positive. Many governments acknowledge the significance of donor assistance. For instance the Ethiopian economy is a typical donor economy, so is the economy of Lesotho, Botswana and to some extent Rwanda. The poverty reduction strategies of Lesotho and Botswana (2000, 2000) acknowledge the role that NGOs can play in the entire process; but the point perhaps needs emphasis is that Africa, being the richest continent in terms of resources should eventually desist from aid dependency and that if donors are really modest in their help, they must provide sustainable skills for future self-reliance

otherwise it will be difficult to dispel the conspiracy surrounding donor assistance, more so when Africa is still smarting from colonial oppression by the same samaritans?. A closer look at Rwanda should illustrate the impact of foreign aid in Africa.

2.4.3 Challenges Experienced by Government in Making External Aid Effective

The post genocide government was new with little experience and resources; the coordination office lacked enough staff, funds, logistics and all resources necessary to perform all the coordination duties. The Regional Director of IRC suggests that NGOs did not respond promptly to support government directly, because most of them received funds from donors and could not spend the funds as they wished. For example, the American Office Foreign Disaster Assistance (OFDA) was the biggest donor but because it is not a development agency, it does not deal with government directly. Funds from OFDA to NGOs were not supposed to be used to support government (Keys, 1999). Donors were not supporting government directly, and their policy did not allow NGOs or other boundary partners to support government directly. Unlike areas like Somalia where agencies supported activities in a kind of vacuum, with no authority, Rwanda was different because the RPF had defeated the criminals, halted the genocide and installed a new government. It was still new with few resources but it was present with very dedicated people eager to make things work and to put Rwanda back on the road to development (ibid).

After the war and genocide when a new Government was set up there was competition among different government ministries each wanting to co-ordinate. In fact there was no clear coordination authority. Procedures in the department were long and bureaucratic, ministries took long to provide policy guidelines and they delayed to show needs, and priority concerns to

partners. In this regard, this lack of clear government policies and guidelines resulted in a situation where some important areas were not well covered e.g. agriculture (food production and food security) and education sectors. Local community leaders were not trained in project planning, management, and sustainability. Therefore they were not able to direct development partners sufficiently. This delayed work and led Donor Community to work on their own because they had their own deadlines.

There was little of coordination between line ministries and between local and national levels. Provinces and Districts co-ordination committees that include representatives of NGOs did not operate well in a number of areas or tended to be slow. This made NGO work difficult. NGOs complained that they were not consulted during the evaluations, and suggested that the basic agreement should be reviewed and updated to improve relations with the different partners (Report of the Workshop on NGO/Government Collaboration, 1996). Since both sides (GoR and its Development Partners) agreed on increasing the effectiveness of aid in November 2006, successful development, in terms of broad-based economic growth and sustained poverty reduction, is best achieved within an enabling environment, characterised by peace and security, good governance, effective rule of law, respect for human rights and full participation of civil society and the private sector as stakeholders in the country?s development. Aid effectiveness is also built on these sure foundations. (MINECOFIN, 2007). But currently, different findings dramatically illustrate the bigger problem that Rwanda faces today, namely the low quality of aid. Rwanda is already one of the most aid dependent countries in the world at US$55 per capita per year in ODA. Yet, we see mitigated impact on economic growth and disappointing results in terms of poverty reduction.

This is because much of the US$497.6 of aid reaching Rwanda today is neither on budget, nor on plan, let alone being aligned with the MDGs. (HDR-UNDP, 2007). The United Nations Development Programme 2005, Baseline Survey estimated that more than two-thirds of all aid coming in to Rwanda comes in the form of projects and is, for the most part, neither on budget nor on plan. There is a real risk that a rapid scaling up of aid flows could lead to a further deterioration in the quality of aid and, hence, to an increase in wastage, duplication and inefficiency. Basing on these government and donors different publications, one may argue that aid may have a little bearing or impact on eradicating the so-called domesticated poverty at family level; hence this affects development, since Seers, (1980) views development as eradication of inequality and poverty. Thus the change in poverty is a function of growth, initial distribution, and change in this distribution which also will depend on policy?s pursuance.

2.5 Implications of Literature Review

The negative relation between aid and growth dominates aid. Nonetheless, it remains paradoxical that aid is still highly significant across regressions. This prompts researchers us to continue thinking about how to improve the effectiveness of aid. Reforms are certainly necessary, not only for recipients but also for donors, especially multilateral aid agencies.

It is widely accepted that aid works well in good-policy environment and in reality there are many good examples of success, for instance Ethiopia, Uganda, Viet Nam, India etc (World Bank, 1998).

The implications are therefore obvious: Aid is more effective when it is used to facilitate timely and efficiently the reforms initiated by the local governments, not to condition the reforms. Put it another way, the reform should be internalized, not imposed by outsiders. What aid does is «to help good governments to survive long enough to solve the problems» (World Bank, 1998). Countries may learn from the successful experiences of others, but need to tailor appropriately their own action plans. Aid is more effective and viable if it finances government bureaucrats training or policymakers? overseas education and then nurture the reforms initiated by them.

In reality, the World Bank structural adjustment programs and IMF stabilization programs failed in many cases due to the lack of appropriateness and strict penalty upon bad performance. Conditionality is unlikely to bring about lasting reform if there is no strong domestic movement for change (World Bank, 1998). Therefore, conditionality should work in the way that ensures the effectiveness of loan where the reforms are in place. Rewarding good performers in aid allocation is a good way to encourage other recipient countries to learn from them. More importantly, the penalty should be implemented strictly upon the violation of conditional terms. Loans should be postponed or even terminated unless further positive evidence is accorded. The current patterns of channelling aid through centralized governments in recipient countries may reduce the timeliness and efficiency of aid. It is found that the aid is more effective if it is delivered directly to the working level local authorities. Hence, the emerging role of NGO community is widely attracting attention (World Bank, 1998). The present coordination and cooperation among donors is problematic. Most of donors and aid agencies have their own objectives and different plans in providing aid. «Raising flag» is a common phenomenon among donors and aid agencies.

Therefore, instead of cooperating, they are normally stepping on each other?s toes by
undertaking different approaches. As a result, the overall aid effectiveness on the growth of the

nation most of the time fails to succeed, even though many aid projects are assessed effectively.

In the final analysis most of the literature on the impact of foreign aid is highly generalized and

guided by the statistical interpretations of World Bank and other Bretton Woods institutions.

There is hardly any literature based on the local representations of the impact of aid on economic

and social development. This study is situated in this niche, with special focus on the responses
of the actors in the aid matrix in Gasabo District, Rwanda.

2.6 Chapter summary

This chapter has presented a detailed analysis of the issue under investigation against

fight poverty. The next chapter presents a detailed description of the methodology.

CHAPTER TRHEE: RESEARCH METHODOLOGY

3.0 Introduction

This chapter deals with the research methodologies that were employed in this study. Initially, the general research designs shall be briefly discussed and thereafter the selection of research methods applicable to this study shall also be explained. The major thrust of the study shall focus on upholding principles of validity and reliability/credibility and trustworthiness.

3.1 Research Design

3.1.1 Research Design - An overview

A research design lays the foundation for conducting the research in an effective and efficient manner. Like a good plan, it provides the specific details that guide the researcher. Bryman and Bell (2007) define a research design as a framework for the collection and analysis of data. Coolican (1994:4) refers to research design as a method for gathering empirical data with which to test a hypothesis or develop a theory. Bless and Higson-Smith (1995:63) say that a research design specifies the most adequate operations to be performed to test specific hypothesis under given conditions?. In another dimension Monetle, Sullivan and Dejong (1990) maintain that a research design is a detailed plan utilizing how observations will be made. In other words it says who is to be studied and how the subject/object of study is to be studied; for example it spells out the methods of data collection, instruments by which data is collected and how that data are to be analyzed as well as the techniques of data analysis.

The process of designing a research study involves many interrelated decisions and it is an inherently iterative process in which earlier decisions are constantly being considered in the light of subsequent decisions (Aaker, Kumar and Day 2004: 73). The choice of the approach depends on the type of the research that one intends to carry out. In light of this, this study adopted the case study approach in view of its advantages.

3.1.2 Exploratory and Descriptive Phases of the Research Project

One important decision that needs to be made when developing a primary research plan is whether to conduct a qualitative or a quantitative survey (Palmer 1994: 108). The research approach selected in this instance a case study of Gasabo Distict of Rwanda. The approach acknowledges the argument put forward by Malhotra (1996: 164) that it is a sound principle to view qualitative and quantitative research as complimentary, rather than in competition. Bryman and Bell (2003: 15) define a case study design as the detailed and intensive analysis of a single case. They further argue that case study research is concerned with complexity and particular nature of the case in question.

Coolican (1999: 27) concurs that case studies are in-depth investigations of one person or group of persons usually over a long time. A great deal of qualitative and quantitative data is gathered to illuminate a particular, perhaps unique set of conditions or experiences. This research project sets out to explore the impact of foreign aid on the socio-economic development of Rwanda in Gasabo district. In the process it seeks to assess the reactions of various parties in the aid development nexus.

Chisaka and Vakalisa (2003) credit the case study strategy with the chief advantage of being applicable to both qualitative and quantitative research paradigms. In this respect a research technique that includes questionnaires, interviews, documentary analysis and observations were used in this study. Case studies give the researcher an opportunity, to contextually study a given situation thereby adopting principles of both ethno-methodological and phenomenological paradigms. Findings are reported through in-depth reporting and description of data (Nyawaranda 2004). In this respect a case study offers the researcher an opportunity to view issues from the perspective of an insider (emic perspective) as well as an outsider (etic perspective).

3.1.3 An overview of the existing situation of the Gasabo District as the case study

The Gasabo District presents opportunities for economic development which have not yet been exploited. Its geographical location between the Kigali City and Lake river of Muhazi and the Gasabo plateau offers abundant investment opportunities in agriculture, hotel and tourism sector and has high potentiality for investment. Historical sites which form the cradle of ancient Rwanda such as the four goddesses of Bumbogo, the foot imprints of the legendary king Ruganzu at Jali, the vestiges of the royal palace on the hill of Gasabo, the burial sites of princes are some of the unparalleled touristic potentialities for investment. There is also the panoramic view of the plateau overlooking Lake Muhazi. The District has trading centres scattered all over Sectors and intermediary Centres which constitute points of attraction for economic activities, small industries and crafts. Some mobile traders, retailers and wholesalers need training and mobilisation to kick-start economic development in the Sectors. To this effect, the role of foreign

aid in enhancing socio-economic development can not be underestimated with a view to harness the potential growth development that may seem inherent. The level of industrialisation remains low with only four factories: UTEXRWA, RWACOM, Kabuye Sugar Works and SORWATOM operating in the District. The development of this Sector shall move along with the development of the industrial park which fulfils the environmental norms. (PDD, Gasabo 2007)

Below is the new administrative map of Gasabo District, showing all the 15 sectors from which data were gathered for the purpose of this study.

In terms of demographic data the District has a population of approximately 410 485 people. The study population was therefore extracted from this approximate gross/total population of entire district.

3.1.4 Sources of Data

This study is principally guided by two major sources of data. According to Howard and Sharp (1983) primary data refers to data which the researcher gathers while secondary data is that data which is gathered by others. In this regard the researcher will use information gathered from interviews, questionnaires and focus group discussions as primary data. In turn the secondary sources include written organizational literature and published books and journal articles on foreign-aid-development and MDGs nexus.

3.1.5 Types of data

The study relies on two types of data namely quantitative and qualitative data. Dooley, (1995) argues that qualitative research refers to sound research based on field observations analyzed without statistics. Similarly, Nyawaranda (2004) maintains that qualitative research seeks in-depth insights rather than statistical analysis. Interviews and focus group discussions will provide the bulk of qualitative data. Sheila and Mwiria (1995:42) say that quantitative research involves a research in which the researchers «assume that behavior of humans like that of matter can be objectively measured through the construction of appropriate research instruments.» In this respect, questionnaires are designed to generate objective responses from respondents. The bulk of calculable data will come from questionnaires and statistical records from the organizations under study.

3.1.6 Target Population, Sampling and Sampling Procedures

Moonie, (2000) defines population as the entire group of persons having the same characteristics that are of interest to the researcher. Ringrose (1986) postulates that population denotes all the potential participants from which the sample is drawn. This study targets a population of four hundred and fifty (450) respondents. According to Best and Khan (1993:13) a sample refers to a small proportion of a population selected for observation and analysis. In this study the researcher will sample 150 participants for detailed study.

In this research study, the sampling processes will be carried out at two levels. Firstly, the identification of Gasabo District, Donor organizations and boundary partners will be done purposively. In Gasabo participants will come from 30 beneficiary cooperatives and 15 imirenge (sectors) coordinators representing the 15 sectors in the district. Selected donor communities include UNDP, USAID, DFID, Belgian Technical Cooperation (BTC) and WORLD VISION. Boundary partners purposively selected will include His Excellency the President of the Republic of Rwanda or his spokesperson, and officials (preferably permanent secretaries) from the Infrastructure, Education, Health, Commerce and Trade, Finance and Economic Development, Local Government, Gender and Foreign Affairs Ministries. All these are selected purposively as key informants. Sullivan et al., (1990) say that purposive or judgmental sampling specifically excludes certain types of people because their presence might confuse the research findings. Bailey, (1987) credits this technique with the advantage of being more representative and has the ability to be generalized over a larger population. However, because this technique does not give equal opportunity for all elements to be included (being non-probability sampling technique) other sampling techniques need to be employed to cater for the limitation.

Simple random sampling (SRS) technique is the natural alternative. Aldridge and Levine (2001) define it as a design in which the cases that will make up the sample are chosen in a single process of selection from the sampling frame that covers the entire target population. In this regard each element has an equal chance of being chosen. The questionnaire will be administered on randomly selected members of the target community. The total number of members of the target community will constitute the sampling frame. Systematic random sampling will then be employed to ensure that all the 15 sectors of the Gasabo district will be represented. Sullivan et al. (1990) credits this technique with the exceptional advantage of treating the target population as a unitary whole. In this regard, its attempt to guarantee an equal opportunity may in a way minimize bias and prejudice. Nonetheless some of the key district officials will be purposively chosen for in-depth interviews. Below is a summary of sampling frame, subgroups and the final sample size.

Below is an overview of sample size in relation to the study population and data gathering tool used.

N.B The researcher took heed of recommendations by Frankel and Wallen (1996) that a representative sample should be at least a third of the entire study population.

3.2 Data gathering instruments

3.2.1 An Overview

Denscombe (2000:85) advocates the use of two or more methods of data collection to enhance the validation and reliability of data, arguing that the use of multi method approach allows findings to be corroborated or questioned by comparing data produced by different methods. Determining the impact of the results of any research work is dependent upon two concepts: validity and reliability (Last 2001). Essentially, validity entails the question, «Does your measurement process, assessment, or project actually measure what you intend to measure?» Best (1989) defines validity as that quality of data gathering instrument that may enable it to measure what it is supposed to measure. Aldridge and Levine (2001; 183) define validity as whether a measuring instrument indicates success in measuring what it is designed for. Content validity is defined as an approval to establish the validity measurements including assessing the logical relationship between the proposed measure and the theoretical definition of the variable (Sullivan et al.1989). Reliability, on the other hand, addresses whether repeated measurements or assessments provide a consistent result given the same initial circumstances (NATCO, The

Organisation for Transplant Professionals: 2009). Sullivan et al. (2000:218) sayreliability refers to the ability of a measure to yield consistent results each time it is used?. Similarly Aldridge and Levine (2001) define it as a measure of the extent to which the results of an indicator or test are consistent over time. Internal validity encompasses whether the results of the study are legitimate because of the way the groups were selected, the data was recorded or the analysis was performed. External validity, often called generalizability?, involves whether the results given by the study are transferable to other groups (i.e. populations of interest) as postulated by Handley (2009:1). This research intends to achieve both internal and external validity of results through following a proper study design and strict protocol execution.

A common threat to internal validity is reliability. Russ - Eft (1980: 37) defined reliability as the degree to which the results are attributable to sources of variance. This research tries to overcome the risks associated with reliability by reviewing and thoroughly checking the research instruments and employing consistency checks. The instruments of data collection to be used are interviews, focus group discussions, questionnaires documentary analysis and observational schedules.

3.2.2 Structured in-depth Interviews

Bryman and Bell (2003: 115) define an interview as the soliciting of information by the interviewer from the interviewee. Saunders et al. (1997) citing Kahn and Cannell (1957) describe an interview as a purposeful discussion between two or more people. Interviews are meant to elicit primary data responses through direct questioning, (Wegner, 1993).

It is the most common form of data collection in any social survey such as elicit different people?s opinions on a subject such as the socio-economic impact of foreign aid on development. According to Fraenkel and Wallen (1996), the advantages of using the interview technique approach are that the respondents can expand on areas of interest and can use non-verbal cues such as expression to emphasize their responses. In this study, several respondents were lined for interviews. These include: the Head of State (or his spokesperson), donor representatives, relevant ministry officials, sector coordinators and community leaders.

3.2.3 The Questionnaire method

Questionnaires are used to investigate attitudes, beliefs, feelings, opinions, knowledge and some aspects of behaviour (British Educational Research Association, 2006 - 2009 http://www.bera.ac.uk/questionnaire/#use). This method, if expertly designed, can give the researcher reliable data. Denscombe (1998: 88) argues that the questionnaire works on the premise that if you want to find out something about people and their attitudes you simply go and ask them what you want to know, and get the information straight from the horse?s mouth?. Using questionnaires to collect data is a relatively quick way of gathering such information with relatively good response rates, in addition to preserving respondent confidentiality. It consists of open-ended and closed-questions. According to Harzadon (1981) open-ended questions are advantageous because they give the respondents the opportunity to answer adequately applying the detail they like to qualify and clarify issues as well as giving them an opportunity for self-expression.

Labovitz and Hargedon (1988) highlight that the serves time and financial resources since it can be locally administered. Frankel and Wallen (1996) maintain that the questionnaire can cover a large sample and also ensures anonymity and greater detail in as far as the handling sensitive issues is concerned. In view of the delicate nature and controversy of the subject, the questionnaire is deemed to be an effective instrument. In this context, objective responses will be obtained through closed questions while subjective responses will be obtained through open-ended questions. The attempt by the instrument to combine some aspects of quantitative and qualitative data makes it an effective instrument (Sheila and Mwiria 1996). However, the research takes note of some of the limitations of the questionnaire. For instance according to Frankel and Wallen (1996) the distance between the researcher and the respondents\researched leads to lack of rapport. Probing is not possible with closed questions hence there is no room to attach meanings in such questions (Dooley 1995).

The questionnaire is a rigid form hence rephrasing questions may not be possible (Haralambos and Holborn 1995). In this respect the questionnaire only relies on intellectual and literacy competence of the respondents as opposed to the interview method. The researcher will not post any questions but will physically be distributed them with the help of research assistants. A total of forty (40) questionnaires were administered to various categories of respondents.

3.2.4 Focussed Group Discussions

According to Shumba and Kaziboni (2005), the Focused Group Discussion (FGD) is a new
approach / technique in which some discussion schedules are used to interview 5 to 10
respondents simultaneously. It is an effective tool for gathering public opinion. Against this

background issues that are considered sensitive, controversial and delicate can be effectively debated. In applying this technique, the researcher categorically placed respondents into groups. Any four (4) communities were selected randomly for the aid impact assessment debate. The focused group discussion falls in the realm of qualitative research paradigm (Lincoln and Guba 1985). This method is credited with the principal advantage of saving time as well as the ability to discuss issues democratically on an open debate forum (Shumba and Kaziboni 2005). It allows the in-depth-study of issues and enhances cross-pollination of ideas and views (Ngoepe, 2006). Focused group discussions usually stimulate interest among respondents through debates (Ngulube, 2006). For it to yield valid results, the following limitations need to be guarded against: Such discussions only generate qualitative data hence there is over reliance on subjective rather than objective conclusions. As observed by AVERT (2007) that other respondents may be dominated by others in the debate and if not guided and controlled, the focus and objective may be defeated.

3.2.5 Documentary analysis/content analysis procedures

Content analysis is a systematic research technique that focuses on the analysis of both quantitative and qualitative manifest or latent meanings of words, ideas, phrases, postures, objectives and artefacts (Achola 1995). Against this backdrop it follows that documentary analysis procedure will generate natural data for analysis. It is further assumed that it saves both money and time. Shumba and Kaziboni (2005) credit this method, an advantage to the researcher that she/he interacts with printed materials which are non-human in nature. To this end, attempts by respondents to deliberately lie or seek refuge behind secretaries in the case of questionnaire are well catered for.

In view of the merits, textual data and all forms of materials related to the foreign aid, MDGs and poverty alleviation, the context of socio-economic development programmes were scholarly scrutinized in an effort to see whether they have a bearing to the topic under study. As such this particular study made reference to registers of NGOs and some policies on Government development assistance at ministerial levels.

3.2.6 Observational schedules (Participant and non-participant

observation)

The study also used some principles of Observational schedules in gathering data for analysis. Observation is hailed by Dooley (1995) as a key qualitative data gathering tool because of its ability to generate first hand data. In this regard it follows that there is need to use a method that appeals to the needs and interest of respondents/informants. Haralambos and Holborn (2006) credit this approach for its ability to involve the researcher as a key participant particularly through participant observation. However the method may have a limitation that there is a possibility of the researcher to fail to bracket his or her own experience hence leading to ultimate bias. Non-participant observation may make researcher all off and may make the informants become suspicious and behave artificially. In this case, the researcher intertwined both the principles of non-participant and participant observation to suit different situations and overcome the constraints and limitations she was coming across.

3.3 Data presentation and analysis

Borgdan and Biklen (1992) define data analysis as a process of systematically searching and
arranging the interview transcripts and other materials that the researcher accumulates to increase
his/ her understanding of them and enable him/her to present what he/she would have discovered

to them. The data collected using questionnaires will be analysed using a statistical computer package. For sorting purposes, questionnaires will be coded by way of giving each completed one a unique code on receipt from the respondents. All responses will thus be considered pre-coded since the computer package (SPSS) has the capability to assign codes and values to each response entry. Frequencies, cross-tabulations, means and analysis of variances (ANOVA) obtained from the results will be analysed and summarised into tables and graphs that reflect patterns and relationships. The qualitative aspects of the questionnaires and other qualitative data from interviews and focus group discussions will be analysed using thematic content analysis. Details of the analysis will be presented in Chapter 4 in the form of graphs, tables and descriptive comments.

3.4 Chapter summary

This chapter has outlined the research design adopted in this study and has further justified the methodologies used. The research instruments that were employed have been exposed and efforts have been made to explain how the data was collected. The next chapter deals with the categorization, presentation, interpretation and analysis of findings.

CHAPTER FOUR: DATA PRESENTATION, INTERPRETATION AND ANALYSIS

4.0 Introduction

This chapter presents, categorizes, interprets and analyses the data that was gathered using the questionnaire, interview, focus group discussions, documentary analysis and observation schedules.

Data obtained from the questionnaires were analysed first using SPSS version 17.0 and presented in the form of frequency tables and graphs. Some aspects of the data obtained from open-ended questionnaires were thematically analysed and supported by information obtained through the focussed group discussion. The second and third sections constitute the bulk of the findings from interviews, document analysis procedures and observational schedules, and like the second aspect of the questionnaire were thematically analysed. In all cases the research themes were addressed. The recommendations by Aldridge and Levine (2001), were taken into account in the formulation of the emerging themes that are going to inform the discussion. The themes were formulated in order to categorize the data.

This chapter begins with, the findings from the questionnaire followed by a discussion of findings from interviews and documents analysis procedures and the overview of the existing situation of Gasabo District. The last part is a summary of findings merging all the findings from the different data sources, and demonstrating emerging trends here described as key findings.

4.1 Discussion of questionnaire findings

Generally the response rate was quite good (80%) and there was evidence that both women and men were quite comfortable with interacting with the questionnaire though in some instances blank responses could not be ruled out for one reason or the other.

4.1.2 Quali-Quantitative Analysis of Questionnaire Data

Below is a quali-quantitative analysis of questionnaire data. It is quali-quanti in the sense that both qualitative and quantitative data are analysed given that the questionnaire itself comprised both objective and subjective sections. As such objective responses are analysed quantitatively while descriptive (subjectively) data are analysed thematically. Note, however, that both types of data, because they are corroborative in that they are responding to the same question, are therefore treated simultaneously.

4.1.2.1 Gendered perceptions on poverty as Rwanda's threat to socio-economic development

Research findings reveal that 85% of all male respondents supported the idea that Rwanda?s socio-economic development was being threatened by poverty. Even more female respondents (100%) believe that poverty is a key threat to Rwanda?s prosperity, a negligible average percentage of about 5% thinking otherwise.

The issue of poverty reduction is of great concern for Rwanda, as Rwanda has its own policies and efforts made by technocrats.

Poverty lowers production of the productive sector, in particular small scale enterprises with no savings in the banks hence there is no bargaining power to get credits from the banks.

Based on the findings, it can be noted that the overall poverty affects the living standards of citizens and all their aspects towards economic development. Since the genocide Rwanda has been struggling with fiscal deficit and her efforts have always been directed towards servicing national debt which has been accumulating exponentially in spite of foreign aid (Ministry of Finance statistics Department, 2004:134). MeIZITQEEEEE EaQdEIIIE, E5 ZEQAVESRYHWEIDe decreased from 60.2% to 56.9% of the population (UNDP, 2007).

This trend has continued despite her macro-economic strategy to decrease excessive dependence on foreign assistance (ibid). On the other hand the government of Rwanda has directed most of its resources towards helping people survive instead of investing in developmental activities which recapitalize the productive sector of the economy (ibid: 135). The recapitalization of the productive sector enhances employment opportunities for the citizens, reducing poverty thereby enhancing socio-economic growth which is key to the attainment of MDGs.

4.1.2.2 Views on whether poverty is a threat to Rwanda's socio-economic development by organizations

The study reveals that the majority of the participants (88%) felt that poverty was a cause for concern to Rwanda?s socio-economic development. The government position on the contribution of poverty to economic retardation is overwhelming, with about 88% of government officials concurring that poverty is a key threat; while about 12% objecting, most probably because they think that other variables than poverty are more key, yet even this does not lessen the enormity of poverty as a grave danger to economic development.

On the other hand the NGOs? reticence on the question speaks louder than words. One would have expected all donor organizations to overwhelmingly vote that poverty is indeed a threat, which would have bolstered their donating efforts; but their silence raises the suspicion that they have more to hide than give. This point will come to a head when we come to their responses to interview questions. Nonetheless, the 12% government officials who indicated that poverty had no bearing on the socio-economic of Rwanda may be understood in the context of them not entirely dismissing poverty as a variable to reckon with but that its impact on economic development is perhaps less key than their other perceived determinants. Otherwise all the participants who were neither NGO nor Government officials (88%) agree that poverty is a major threat to the economic well being of Rwanda. Based on the above findings it can be argued that poverty is a threat to Rwanda?s socio-economic development. This confirms findings by World Bank (1993) that as long as we have poverty in third world countries, developmental trends will remain crippled. However, the perceptions of poverty by different people differ with ages as the table below illustrates.

4.1.2.3 Views on whether Poverty has functional benefits to society

It emerged from the survey that poverty is generally perceived in the negative sense. All government officials dismiss it with the contempt it deserves. Below are the views that were echoed:

Poverty have never benefits the society, it destroy their standard of living, social welfare, creates malnutrition, conflict and disaster;

There are no benefits at all but becomes a social problem instead. Many people become beggars, thieves, prostitutes and idleness;

Essentially it does not but to poor leadership when using for pro-poor project to promote self interest.

This was supported by information obtained using the focused group discussion where one respondent remarked that,

«Poverty makes us afraid of talk, taking position in a meeting, we cannot even give our opinion, we think it will not be taken seriously. No confidence»

Although findings pointed to the fact that poverty has some detrimental effects, on the other angle the functionalists would view it as a functional phenomenon in society. (O?ddInell,IDDI) NGOs are more eloquent by their reticence; perhaps their mere presence justifies their complete negation of poverty; logically they would not be here to support or promote poverty. The only significant response worth some explanation is 6% of participants who suggest that poverty is not entirely dysfunctional. It may be guessed that they view poverty as providing an impetus for community and intergovernmental cooperation, a reason that justifies the need for governance. Although somewhat far-fetched, this reason is compelling in that if all people were self-sufficient there would not be any need for government. The general feeling however is that poverty is a menace that requires the cooperation of all stakeholders (aid agencies included) to eradicate, but the other question that arises is: is foreign aid itself wholly functional?

4.1.2.4 Perceptions of the impact of foreign aid on the Rwandan economy

It was established that (90%) of the respondents indicated that Foreign Aid contributed significantly to the socio-economic development of Rwanda indicated so. Foreign Aid helps in the development of the proposed projects and their implementation.

It does, because Rwanda engages itself on partnership platform not patronage. Many economic growth sectors have been remarkably developed like infrastructures.

) RUiJQIISiGILelYEiQ 5 ZEQGa¹r6RFiR-economic development because they bring projects, create job for us and develop Rwandan with those projects

Although the macro-economic strategy of Rwanda aims in the long run to decrease excessive dependence on foreign aid, at present all indications point in one direction: that she cannot do without assistance. Findings reveal that there is a program in place called VUP - Vision 2020 Umurenge programme. It is the second flagship of EDPRS, it accelerates the rate of poverty reduction by promoting pro-poor components of the national growth agenda. This will be achieved by releasing the productive capacity of the poor in rural areas through a combination of public works, promotion of cooperatives, credit packages and direct support. In the end, these people graduate and move from one category of poverty to another, that is most poor to poor and then to rich-to-be. The idea is eventually eradicate poverty among the people. EDPRS, (2006)

This is part of the Paris Declaration on Aid Effectiveness to which the GoR and its development partners are signatories (Rwanda Aid Policy: 2006: 6). The overall objectives identified by the parties to the Declaration include aligning donor programs to government, strengthening country reporting systems and strengthening local capacities (ibid). But the question that remains is: is poverty itself viewed as entirely negative?

4.1.2.5 Views on whether Foreign Aid creates Dependency on Rwanda by Organization

It emerged from the study that (44%) of the respondents have negative perceptions about foreign aid. According to some of them it creates dependency syndrome on the people of Rwanda by providing them with products (consumables) rather than giving them skills to produce sustainably for themselves. Naturally spoon-feeding dulls creativity and innovation while promoting laziness and dependency. This was supported by information obtained using the focused group discussion where one respondent remarked:

The findings may seem to suggest that a wave of dependency can negatively impact on people if aid is not accompanied by some strategies that can eventually wean the recipients, much as the wise adage would say, give a man a fish, teach him/her how to catch the fish so that tomorrow, he/she will eat them forever. The GoR seems to be aware of this reality as shown by the

significant 44% in the affirmative. The other participants, though more in number (56%) who argued in the contrary do not necessarily diminish the impact of their counterparts? observation. If anything it may be further observed that participants who say aid does not create dependency betray their levels of literacy and analytical sophistication. Surely the Rwandan Government would not put a policy in place for monitoring and evaluating the aid and how it is channelled. According to the Government?s Aid Policy (2006), all assistance is preferred to be delivered through Rwanda?s Public Financial Management (PFM) and procurement systems to ensure that it is controlled and regulated. The graph below further illustrates the gendered perception on the issue of dependency syndrome.

4.1.2.6 Gendered Perceptions of Foreign aid and dependency

The study findings reveal that a majority of respondents (52%) indicated that Foreign Aid leads to dependency syndrome on the part of the Rwanda Government. The remainder 48% felt people use the Aid for sustainable development activities. These positions reflect earlier perceptions which have been attributed to varying levels of literacy and cognitive sophistication. However, there were more females (56%) compared to 50% males who indicated that there is no

correlation between donor aid and consumer dependency and this again buttresses the earlier observation as more women are generally less literate than their male counterparts, especially in third world countries such as Rwanda. These varying levels of literacy were again reflected in the participants? awareness of Millennium Development Goals (MDGs). This corroborates findings by UNDP (2007) who assert that the issue of poverty has some multiple interpretations; hence the so-called gendered nature or feminisation of poverty and aid too.

4.1.2.7 Knowledge of the existence of MDGs in Rwanda

The survey results show that the majority of the respondents (96%) were aware of the MDGs in

Rwanda and nearly all of them had learnt from the Government?s sensitization and mobilization programs (publications) and open public discussions on the country?s Vision 2020. On the other hand, a very strong link (85%) between the Rwanda?s ruling class political ideology and MDGs exists. The ruling class political ideology of Rwanda has programs and strategies such as Economic Development and Poverty Reduction Strategy (EDPRS) and Vision 2020 to address MDGs. It was therefore necessary to find out more about the participants? awareness of MDGs

by asking them to rank them according to their own priorities. It can therefore be concluded that the instrumental role of MDGs as a weapon to fight poverty is overlooked hence the need to acquaint people with critical issues regarding this concept.

4.1.2.8 Ranking of MDGs according to priority

The study findings indicate that of all the MDGs Rwanda is prioritizing the eradication of extreme poverty and hunger most with a number one ranking. A lot of effort is also being put in trying to improve maternal health and combating HIV/AIDS, malaria and other diseases in order of priority, respectively. Findings also revealed that the Rwandan Government is trying to achieve universal primary education for all its citizens as its fourth priority. However issues of gender equality, empowerment of women and global partnership still need greater articulation.

«The issue of eradication poverty and extreme hunger has become a universal priority across all d t_y

Based on this, it can be interpreted that the issue of prioritising MDG 1 may seem to go along the assumptions of modernisation theorists who insist «in order to develop, third world nations must copy western models of development (Sanderson, 1991)

The study findings of the above pie-chart reveal fact that EDPRS is mostly used in Rwanda as a
strategy to eradicate poverty. Based on the findings, it can be argued that strategies as means to

an end are always critical in as far as eradicating of poverty is concerned, thus without user-8%

friendly strategies poverty cannot be ameliorated. The Economic Development and Poverty Reduction Strategy (EDPRS), adopted in 2007 together with Rwanda?s Vision 2020 and Constitution, provides a clear statement of the government?s high level priorities and a consistent set of principles. The EDPRS grew out of the Rwanda?s first Poverty Reduction Strategy Paper

(PRSP), adopted in 2002 and agreed with donor partners as a necessary step towards receiving PRSP EDPRS N

4.1.2.10 Sustainability of Foreign Aid in Rwanda's Socio-economic development

The study findings show that foreign aid could be sustainable in Rwanda?s Socio-economic development from the males? point of view. The point of concern is the perceptions of females whose majority, 80% tended to differ. Aid is not sustainable because the Rwandans feel that they are self-sufficient in spirit and are hard-working to produce enough for themselves and for export, rather than depending on Foreign Aid. This is supported by one male participant?s proverb in Kinyarwanda «akimuhana kaza imvura ihise». This translates to «something from out comes after the rains» in English. In addition Rwanda has an abundance of resources to sustain itself as almost 60% of its budget is not supported by Foreign Aid.

The subjectivity impact of foreign aid in Rwanda may seem to confirm findings from a regional survey by Baker et al (2003) who concluded that the relativity nature of foreign aid and its impact has generated heated debates across the development spectrum, hence the assertions by interractionist scholars who maintain that subjective meanings are attached to social happenings (Palen, 2000).

4.1.2.11 Perceptions of Beneficiaries of Foreign Aid in Rwanda

Current findings show that the majority of the participants (96%) appreciated the impact foreign aid has had in their country. 6RP MsIjd 310I31V310e AID provided directly benefits the FRP P )1j3jes? projects and hence improve their lives and accelerates development in their area. As explained by Todaro (1981) foreign aid is understood as a means to improve the conditions of life in underdeveloped nations, is couched within modernist thought.

4.1.2.12 Relations of the Government of Rwanda and the Donor Community Figure 4.8

The study findings of figure 4.8 above indicate that Rwandan Government has good relations with the international donor community since 2000-2009, as supported by the 0% bad to extremely bad response rate. Development Partners have played a fundamental role in the recovery of the Rwandan economy, and their continued support as Rwanda?s GDP exceed prewar levels will be integral for the achievement of the Millennium Development Goals and national strategies, such as the EDPRS and Vision 2020. (MINECOFIN 2007). This is also supported by the answer of one Government authority who said that «In general I can say even in 10 years ago that our relations with the Development Partners are good. They are involved in different forums for dialogue on aid coordination at different levels where we plan together, we implement together, and where we Monitor and evaluate together»

4.1.2.13 Beneficiaries of Donor Community from 2000-2009 Figure 4.9:

The survey results indicate that the Health Sector was the greatest recipient of Donor community
support in the years 2000 to 2009. The educational sector (62%) and agricultural sector (54%)
were the second and third beneficiaries respectively. However local government was least

Strategies and policies in place in Rwanda such as EDPRS and Vision 2020 focus on human development at all cost. For their implementation the GoR emphasis on the partnership with the donors and establish priorities assuming responsibility for aid coordination in different sectors. Like the Strategic Partnership with Africa notes, budget support instruments can be a particularly effective way of promoting African ownership and development in countries with well-designed poverty reduction strategies and reasonable levels of fiscal accountability.... (SPA 2002a: 13).

4.1.2.14 Availability of Technical Challenges with regards to Implementation of MDGs

The study reveals that it is the view of the majority, 75% of the participants that the Donor Community could be facing technical challenges with regards to the implementation of MDGs. These include attitudinal constraints and other socio-economic constraints. The specific challenges are further shown by the diagram below.

According to ECA (2005) provided development partners appropriately harness existing resources, most of the MDGs are achievable. Part of the challenge is making sure that programmes are interconnected, so that when addressing primary education, for example, a comprehensive development strategy would also incorporate natural resource management and health education.

4.1.2.15 Ranking Rwanda's main Resources in order of importance

It emerged from the survey that agriculture is the backbone of the people and government?s needs, 96% of the participants indicated so. Mining, services and industry in that order are important to a lesser extent. Koster (2008), shows that in July 2006, the population was estimated at 8,648,248, of which the large majority (93.4 percent) lives in the rural areas and that large majority of people (over 90 percent) depends on agricultural subsistence production.

The results obtained from then open-ended questionnaire concur with the focus group discussion/interview results. All of them showed that poverty was a phenomenon so real that its negative impact on the national economy cannot be contested. This picture was shown more vividly at village level. The case of Kimironko Sector deserves special mention. It is one of the 3 urban sectors of the District and accommodates «Centre Cesar» which takes care of Genocide survivors to develop themselves socially and economically. According to the results from the discussions with the villagers, poverty is all about failing to avail the basic necessities of life to oneself or the family. This group was partially aware of MDGs but as captured earlier, none of them really bothered about poverty at national level.

This part presents a synthesis of major findings from interviews, documentary analysis and researcher observation. It begins with an overview of aid coordination background followed by responses from the three major respondents: non-governmental organisations, government officials and the public representing the target beneficiaries of donor aid.

4.2.1 Interview data from administrators

Several respondents were for interviewed. These include: the donor representatives, relevant ministry officials, sector coordinators and community leaders. Following recommendations by Chisaka and Vakalisa (2003), the findings from the interview method are presented thematically with emerging or recurring themes identified. Substantiating evidence in form of people?s real words are also given since it is a qualitative inquiry (Frankel and Wallen 1996).

Table 4.6 below presents data that was gathered using the interview method

EMERGING THEME		SUBSTANTIATING EVIDENCE
How have been the Relations between		In general I can say even in 10 years ago that our
Government of Rwanda and the Donor		relations with the Development Partners were good.
Community since 2000-2009?		(Donors are no longer called Donor Community but
		Development Partners because they are helping us to build our country.) I was saying our relationship is fine in terms of development issues. They are involved in committees where we plan together, we implement together and we Monitor and evaluate together
		(MINECOFIN).
		In general our relationship with the donor community is good. In our 15 sectors, 7 in town and 8 in rural area, we have NGOs and working closely with the community of these sectors in their different development activities.
		Here I am talking about their socio-economic development activities, as you can see it on this chart, (refer to table 4.11), Mayor of Gasabo.
Which sector(s) benefited from foreign		In 2000 our economy was worse than in 1990s because
aid from 2000-2009?		of Genocide. This was the time of reconstruction and
		Rehabilitation, the PRSP was the guidance as poverty strategy. From 2003-2005 things changed: socio life, enrolment of students, gender equality also quite good but with a bit need of change in economic empowerment.
		Service sector was also high, but we realize that all of these are not pro-poor programs. The poverty remains.
		From 2006, the agriculture was the one to be focused in to contribute to the growth; the industry, investment... were too slightly contribute to the economy
		*(MINECOFIN).*
MDGs are principles that only serve a		No. If you know well the history, MDGs come later after
political ideology and are serving		our Vision 2020, which means that when we saw or
cosmetic and window dressing purposes.		heard about the September 2000 UN declarations on
Do you agree?		MDGs, we said excellent, we are in a right way and
From your own point of view what other effects can you highlight which are caused by poverty and hunger on 5 Zanda?\1\RFiR-economic development?
		also high in our district; it is another effect of poverty. (Mayor Gasabo District)
Does Rwanda face technical challenges		Yes we account some challenges here and there with
with regard to implementation of MDGs?		regard to the implementation of MDGs. Rwanda have a
What about your Organization?		good Political will even good programs and plans, but we have also the challenge in Monitoring and Evaluation of these to attain MDGs targets...( MINECOFIN)
There is a general consensus that poverty		Yes it is, but if I have first to start by explaining what
is a threat to Rwanda?s socio-economic		poverty is:
development. What is your reaction?		- first, there is poverty or being poor in mind;
		- second to be poor by lack of means of production
		(financial material).
		Rwanda had to change its population mind, because since the time we have got foreign aid with a new way of thinking, educated, empowered mentally, economically and financially we could be developed. The tied aid was there but we could not see or understand those conditionalities because of our extreme poverty; or even if we knew that this Aid is going back to their country somehow, we could not accept that in these past decades.
		Poverty is a threat to Rwanda?s socio-economic development; let even go through our history, people killed each other, Rwandans to Rwandans this was a lack

of development, instead of developing ourselves we killed each other, so we really need a new mindset and look at our future, plan for poverty alleviation, not for poverty stagnation. (MINALOC)

Yes, poverty is a threat to Rwanda?s socio economic development. You can not be developed economically or socially, when you lack of the living necessities. Poverty for me is in our mind and in the lack of means. We need our population being educated and empowered with means of productions. Education will change our mind and with those means we will use them properly to develop ourselves socially and economically. (Mayor GASABO).

This can happen in some countries but not generally. For example our country is Independent hundred per cent in education area, we are injecting our own money, the basic education in for free 9 years education and in Health, there is "Mutuelle the Sante" medical insurance where a person is only contributing 1000RwF/almost 2$ per year for medication, and the rest is the Government's subsides. (MINALOC)

So if you can see, we need aid in economic development and sustainable one, not something we do today and not

	having it tomorrow. In general I can say we still need Aid today. ...( MINECOFIN)
Some Schools of thought argue that «poverty and hunger are functional». Do you agree in relation to Rwanda?s socio- economic development?	Yes I agree, these are function in our society. This is a retroactivity of poverty. It changes from a place to another. If we knew that we are poor, we could take care and plan for tomorrow. ...( MINECOFIN)
What are Rwanda?s main resources in terms of importance? Do any of these contribute to Rwanda?s GDP?	The main resources of the district are different taxes from our taxpayers and services offered by the district. (Mayor of Gasabo District). Yes, especially taxes contribute to Rwanda's GDP. Mining, Agriculture, Industry and Manufacturing, services...( MINECOFIN, MINALOC)
Can Rwanda do without «Vision Umurenge Programme» in its attempt to fight poverty and hunger?	The Vision Umurenge Program is very effective; its content is the population will. The results are clear, positive... We can do without it if something new emerges in a positive way.( MINECOFIN)
How sustainable is foreign aid in the mainstream of Rwanda?s socio-economic development?	Foreign Aid is not sustainable at all. For now, we can say we need Aid in technology (ICT sector). Technical assistance yes, because we don?t have the capacity, but we need them to teach us when they are in mission for developmental projects so that our development sector could sustain. We need aid on Infrastructure sector and
	ICT and good Management of what we have settled... (MINECOFIN)
	We need Aid and we steel need Aid and I can see in 10 years of driving. Why do I say so? Because when you look at our low growth economy, if you look in terms of our population income, we will get our own capacity
	(domestic resources) in those 10 years. I am not seeing
	Foreign Aid after that time. We are planning for employment creation, creating SMEs and our priorities are in rural area where we plan for rural transformation.
	All of these are the pillars of our mid and long human development strategies, EDPRS and Vision 2020
	*MINALOC.*
Are you aware that Rwanda has MDGs?	Yes we have MDGs. I can not name them but we have a
If yes can you name them?	baseline, where we mark our achievement concerning
	MDGs data. ...( Mayor of Gasabo)
	Yes, I am aware of MDGs as one of Government? planners (MINECOFIN, MINALOC)

4.2.1.1 Interpretation and Analysis

Based on the above views, it can be noted that poverty is a threat to Rwanda?s socio economic
development. Rwanda?s economy is facing some challenges including low agricultural
productivity; famine and cyclical droughts; low human resource development; limited

employment opportunities; high population density and growth; high transport costs and environmental degradation. These microeconomic problems give rise to the following macroeconomic difficulties: structural trade deficit; high vulnerability to terms of trade shocks due to heavy dependence on two export crops - coffee and tea; structural imbalance between Government revenues and expenditures; negative savings; and low level of private investment.

As it has been explained by one GoR?s planner, a lot has been done to eradicate poverty and increase socio economic development. He said: «Rwanda?s needs must be accompanied by a change in the way in which both the Government and its development partners conceptualize aid, so that together we ensure that assistance to Rwanda has maximum impact on the lives of the Rwandan citizen». The rest of the officials (interviewees and questionnaire respondents) were indeed aware of MDGs and were able to think of poverty and foreign aid at macro-level. They gave the overall impression that poverty was indeed a threat to the socio-economic development of Rwanda; and that indeed foreign aid was an indispensable facility.

However, others felt that much as foreign aid was vital, there was need to couple aid with training programs which would leave the beneficiaries self-reliant in the end so as to avoid dependency syndromes. Government officials actually hammered that donors need fall in line with development priorities of Government rather than pursue own agendas. The findings may seem to be consistent with what was obtained through the questionnaire method. However, it can be concluded that a number of challenges that affect the effectiveness of Aid lies directly or indirectly with the negative attitudes held by different partners. These include the donor, the boundary partners in the middle and the recipient at the end of the continuum.

The fact that the community appreciates the impact of foreign aid in a positive manner is worthy. However confirms the functionalist?s view that society has interdependent parts that must work together and meet the societal basic needs or functional prerequisites (Meena 1992).

4.2.2 Data from Observational schedules

The target group/s were Donor Community and beneficiaries as depicted in the pictures below that were taken at Kimironko and Rutunga sectors respectively.

In light of the limitations that were experienced in order to gain entry into some specific groups of respondents, the researcher resorted to using the observational method which is hailed by Dooley (1995), for its ability to generate first hand data. Several Donors were approached in advance to avail time for an interview on the effectiveness of their operations and they accepted in principle (Please see annex). However, when the time came for them to be interviewed they were almost conspiratorially mum? about. They all kept their cards close to their chests, citing one reason or the other as excuses. Some Donor officials referred all matters to higher officials

who would in turn refer the researcher to other higher officials until it became impossible; thus politely denying the researcher access to their operations. Upon further pressing for access, the researcher was then advised by some officials who vowed to remain anonymous as a condition for disclosure that all Development Partners officials were made to sign an oath of secrecy upon entry as a critical precondition for employment. It would seem therefore, judging from their unprecedented reservations that this oath of secrecy is stronger than the Official Secrecy Act.

On second analysis it would seem that this reticence is deliberate: to shut off the public from the internal operations of the organisations. Some of the government officials who work with the Donors pointed out that the organizations declared their intentions and were helped by Government to channel their aid to particular areas but they never really disclosed the sources of their finance, the amounts and how those amounts were broken down among the organisations employees, the boundary partners and the intended beneficiaries. Because of this information blackout it becomes difficult to dismiss some of the arguments by pessimists? who claim that some of the NGOs are created to ease unemployment in their homelands so that the bulk of the monies disbursed benefit directors (who are almost always citizens of guest countries), and also that the intended beneficiaries receive only but a trickle, thus making aid merely a façade hiding ulterior motives which are never disclosed to host governments.

Some critics take the argument even further, stressing that the majority of such NGOs are essentially political institutions working to effect regime changes in host countries in line with foreign policies of guest countries to keep subordinate countries under perpetual dependency, thus sustaining the horse-rider relationships between them.

If the above observations are anything to go by, NGOs then cease to angels of mercy; rather they become messengers of doom. It then explains why their activities are shrouded in secrecy, thus also buttressing reservations by some government officials that foreign aid does not in the long run improve the socio-economic development of Rwanda, but that, rather it encourages dependency. A brief analysis of the responses of target beneficiaries may prove the contrary.

Kimironko Sector is one on the Sectors constituting the District of Gasabo which forms a part of the urban Section of Kigali City. This Sector has Centre Cesar; a women cooperative involved in various economic activities that include tailoring, handcrafts as well as an internet café. The artisans, about 86 in total, create key chains, pen, USB key and cell phone holders from beadwork. During the school vacation, they are joined by around 70 secondary students to continue their work. There are another 12 artisans who embroider various motifs for greeting cards and wall hangings, and more than 14 tailors who produce dresses, shirts, pants, school uniforms and a really nice line of sleep wear for sale in Canada and Rwanda. The school aged children of the widows receive sponsorship from Canadians to continue their primary and secondary educations, infants come to the center with their mothers during the day, and toddlers too young to attend school go to the daycare built by the center ( http://www.in2eastafrica.net). One may observe that after 1994, Rwanda? socio-economic development was to be taken into account by all stakeholders.

One of the group member described poverty as something bad which happen to people whereby
one is in a situation where you have No clothes, no food, no body oil, where he/she is afraid of
others, hopeless and no confident of yourself. «Poverty destroys our welfare, one cannot sit and

chat with others comfortably; you feel empty when you are poor even if you have been to school. You cannot even talk in public, leave a life without future, without objectives; with poverty you don?t even think, no constructive ideas».

More information given by one respondent aptly was that poverty for a Rwandan especially the genocide widow is the strength you got to work and do whatever possible to get something for your family (mean to get food and other living necessities in need). «Even if I am poor, I want to work hard and change the welfare of my family, all my household for the better», she said. Another went further to claim, «Poverty creates bad things, bad habits, I think even genocide was caused by poverty; people were poor somehow, financially, economically, and mentally.» Poverty can make people work tirelessly, trying to get something even if is not enough. The poor always have to think of something to do, even the cheapest job, which some are shamed to do for example the prostitution.

Given this background, the Sector of Rutunga occupies the rural section of Gasabo District. The villagers generally agreed that any aid including foreign aid is welcome. Notably, all of them never seemed to think of aid in terms of development at national level. They conceived aid only in terms of their local poverty, leaving this impression to the researcher that only those who are well up have the indulgence of analysing whether aid came with strings, the nature of the strings etc; the real poor did not. Such an impression leaves a feeling of guilt even on the researcher: Perhaps government needs to do more to raise the standards of living of its people so that they can be able to see things in a broader light than the castles of their skins.

4.2.3 Documentary Analysis Procedures

As observed by Lincoln and Guba (1985) that qualitative evidence is quite critical, it follows that, in this current study a number of official documents were scrutinized and a particular focus was placed on the milestones registered so far. This constituted the bulk evidence of desk research.

Official Document	Link with MDGs and Foreign aid	Substantiating evidence
Annual reports on progress of MDGs
1. Rwanda Development	The documents? preambles and	It is reported that institutional
Indicators	introduction and forewords are	reforms were instrumental in
	targeting the eradication of	SrRPRWQ I .5 ZEQ3Ir sREIR-
	poverty in the context of	economic development hence the
	MDGs as well as acknowledging the role of the	high rise in production levels.
	Donor community
2. Annual report of the		The 2008 Annual report reports
Government of Rwanda		that 2008 has been a rewarding
and Development partners.		year and saw implementation of economic development and poverty
		Reduction Strategy (EDPRS) getting underway. Through aid, Rwanda is no longer a country burdened by shadows of the past.
Documentary evidence on foreign aid (material and financial)
1. Official Development	This is a viable weapon to	ODA acknowledges the receipt of
assistance (ODA) report	fight poverty	food aid from UNWFP.
2. Donor division of labour in		The adoption of a donor
Rwanda		performance assessment
		Framework (DPAF) was a major milestone in fighting poverty.
Inter-ministerial reports on conduct of donors
1. Rwanda Vision	This is GoR?s instruments in	The Vision 2020 is backed by the
	poverty reduction	Presidential Decree powers; this evidence makes researchers conclude that the foreign aid and its link to socio-economic development cannot be overstressed.
2. Rwanda Aid Policy		The fact that the policy is endorsed by the Cabinet makes it a powerful instrument.

4.2.3.1 Registers of Donors

A register of foreign aid providers was also seen an indication that Rwanda?s socio-economic development is being aided. Furthermore some development assistance databases for quality assessment were also scrutinized.

Name	Area of intervention	Domain d'intervention	Statuts	Tel	E-mail
Action for Health& Integreted development	Kinyinya	Health	INGOs
ACCESS/JHPIEGO RWANDA		Health	INGOs	788301311	bishamara@vahoo.fr
ADRA-RWANDA	Jabana, Jali,GIrmro,Nduba	Education	INGOs	0788309281	snemanager@adra.org.rw
AFRICA ANCHOR OF HOPE INC: AOH	ICamatamu Gatabal7	Education,Health	INGOs	0788517715	rugira moses@yahoo.fr
AFRICA MUSLIMS AGENCY	NDERA	Education	INGOs	0788641984	kigali000ama@gmail.com
AFRICAN RELIEF FOR DEVELOPMENT	Remera	Education,Health	INGOs	0788683270	mjabush@gmail.com
AFRICARE Rwanda Program	Rusorr, Glcmro,Ndera	Health,Education(OVC)	INGOs	0788531699	africarerwavahoo.com
AKILAH INSTITUTE FOR WOMEN	Kimironko/Hosp	Education	INGOs	0785525881	Monique@Akilahlnstitue.org
ARDIF	ICacyiru	Capacity building,	INGOs
AQUADEV CENTER AFRICA		Business& micri finances	INGOs
AVOCATS SANS FRONTIERES:ASF	Remera	Training	INGOs	0788306719	rwa-cm@asf.be
BETWEEN FOUR EYES	ICacyiru,Gisozi	TOT,Health, Education	INGOs	0783005900	irepashiu,@gmail.00m
BREAST CANCER		Health	INGOs
Catholic agency for Overseas development,:CAFOD		Social,	INGOs	788301378
CATHOLIC RELIEF SERVICES RWANDA	Gasabo	Education ,social	INGOs		snzayisenga@rw.caro.crs.org
CDI-AFRICA	Gasabo	Training,research	INGOs
CHABHA(Chiklren affected by HIV/AIDS)	ICacyiru	Health	INGOs	788454354	mutabazirichardavahoo.fr
CHF INTERNATIONAL RWANDA	Gisozi/FAWE	Health, nutrition	INGOs	788301762	info@chfrwandaorg.rw
COMPASSION INTERNATIONAL	ICacyiru	OVC	INGOs	788304856	serugambaue@rw.ci.ore
Name OPPORTUNITY TRUST	Kigali	tioneconomic Statuts	INGOs	E-mail	rwanda@dotrustorg
ted development INTERNATIONALK	He	Health	INGOs	0788302780	dcirwanda@dcintorg
NDA Development center,inc	Hea	education	311 bis	hoofr	Jnshimivimanaaedc.ore
Ester's AID for needy& abandoned Jabana,	Edu	INGOs		281 sne@adra.orgrw	esthersaid@excite.com.
OPE INC: AOH Kamatam	Education	HEALTH	715 rug	@yahoo.fr
NCY Outreach foundation Rwnda NDERA	Education	Education INGOs 07	984 kig	a@gmail.com	wmmonladfacs.com

In Gasabo District development plan 2008-2012, maintenance of infrastructure it is a must. The

UTE FOR WOMEN Kimironko/Hosp Education INGOs 0785525881 Monique@AkilhIntituorgTER AFRICA

Associations of the District must participate in all activities which promote the development of

the District. The Government, private sector and development partners (refer to table 4.11, a lot

of them are there for long-time and have to reregister every year) must assist the District in the

The anticipated interventions in the District of Gasabo have a value estimated at 132 M US dollars which are equivalent to approximately 72.7 billion Frw which shall be raised as follows:

Based on the content of this table 4.12 shF IIIQGEQJNIKRZ sNds IRIFIJQ dIGEiQ GdsdER BsrWs?s development activities is prime need and present almost 50% of the development budget. At the country level development partners are, as a collective, increasingly providing funds through budget support mechanisms as illustrates by the figure below:

In 2006, total Official Development Assistance (ODA) to Rwanda reached $603 million, equivalent to roughly 27 per cent of Gross Domestic Product (GDP), with a very substantial share provided by multilaterals and global programmes (MINECOFIN, 2007). In 2006, 26 per cent of external grants took the form of budget support, increasing to about 30 per cent in 2007 as new partners joined Rwanda?s Budget Support Harmonisation Group (BSHG).

4.2.3.2 Interpretation and analysis

Based on the findings from official documents scrutinised, it can be interpreted that MDGs in Rwanda are complemented by various strategies hence the issue of foreign aid cannot be underestimated at all cost .To this effect it stands to reason that foreign aid is important. Finally, while good cooperation is characterised by mutual exchange of ideas about methods and solutions, development partners too frequently continue to promote their own objectives and methods at the expense of the beneficiary?s ownership. Much of the cooperation is still offRwanda?s socio economic development and therefore not aligned with Government?s Strategic Plan and administrative systems. In order to make the cooperation more effective, modalities must be designed to reform and simplify donor policies and procedures to encourage collaborative behaviour and progressive alignment with Government?s priorities, systems and procedures. In the final analysis it was felt that aid was still inevitable but that aid programs must be accompanied by national productive programs which will eventually sustain the economy without aid.

4.3 Chapter summary

The Chapter has focused on data presentation, interpretation and analysis. It has further explored and exposed the perceptions and attitudes of society with regard to the impact of foreign aid on 5 ZEndE?\,\RFiR-economic development as guided by MDG1, basing on the qualitative and quantitative evidence from respondents and re\0ErFh01¹\ Rb\0rvEtiRn. The next chapter presents a summary of major findings, conclusion of the entire study as well as elaborate recommendations for future attention and study respectively.

CHAPTER FIVE: SUMMARIES, CONCLUSIONS AND RECOMMENDATIONS

5.0 Introduction

This chapter presents a summary of the research findings. It further makes conclusions and gives recommendations for the study on the basis of the findings of this study in relation to the major research questions and objectives set in chapter one of this particular study. The study principally focussed on the impact of foreign aid on Rwanda?s socio-economic development as guided by Millennium Development Goal 1 (MDG1). The samples used were also representative in nature taking into account the principles of generalizability as observed by Lincoln and Guba (1985). The study was confined to both males and females from Gasabo District of Kigali City. The study was also conducted through the use of both qualitative and quantitative research methodologies.

The findings however are generalizable to other District settings not studied in Rwanda and other developing nations particularly because of the combination of both quantitative and qualitative research methods that were employed. The principles of validity and reliability (credibility and trustworthy) were taken care of in the study. The thrust of the study revolved around providing answers to the key question:³«What impact does Foreign Aid have on Rwanda?s socio-economic development as guided by Millennium Development Goal (MDG)1 «Eradication of extreme poverty and hunger»?

5.1 Summary of the major findings

Following recommendations by Borgdan and Biklen (1992), themes formulated from the research questions shall guide the summary of major findings. As such, the major findings in this section are presented in the order of the research questions set out in chapter one of this study as:

What is the effect of poverty and hunger on Rwanda?s socio-economic development? Does foreign aid enhance Rwanda?s socio-economic development?

Do citizens of Rwanda appreciate the introduction of MDGs as guiding principles for poverty alleviation?

How sustainable is foreign donor assistance towards the reduction of poverty and hunger; and how do the beneficiaries evaluate the impact of such foreign aid on the local and national socio-economic development?

It was established that the foreign has an instrumental role in the promotion of sustainable socioeconomic development in the country. The results of the investigations comprehensively affirmed this. Although other respondents had certain perceptions, the general consensus was that the foreign aid acts as a panacea to the problems that developing countries face and particularly those that affect their social, economic and political development respectively. Foreign aid was also hailed for its attempt to cover critical issues with regard to alleviation of poverty and hunger which are main focus of MDG1.

The study came out with findings similar to those by Gruinseit et al. (1997) in which foreign aid was described as having an instrumental role and standing as a "powerful bullet" for the combating of poverty. Respondents felt that some cultures segregate women?s active participation in developmental programmes hence they are not beneficiaries some programmes meant to eradicate poverty through donor /foreign aid intervention. The findings corroborate Ezewu?s (1983) observations that culture as an index of social identity has an impact on the day to day live experiences of a people. In this respect, it varies from place to place hence may dictate the way people may view and interpret certain issues in society.

The study established that there are a myriad of constraints associated with the issues of foreign aid and poverty alleviation and this has ripple effects on socio-economic development. These range from social, economic, technological and political challenges. However, the findings pointed to the fact that there are vast prospects with regard addressing the challenges. Of late, global partnership have as stressed in MDGs Progress Report for Zimbabwe (2004) been at the core of addressing the challenges. The global packages and other internationally initiated programs for developing nations that are associated with globalization are by no means regarded as prospects in the context of positively promoting socio-economic development in the context of foreign aid through eradicating extreme poverty and hunger. Through globalization other practices that were viewed as alien to customary conventions are increasingly getting accepted.

5.2 Conclusion of the study

The study concludes that citizens of Rwanda studied appreciate the fundamental role played by foreign aid in enhancing socio-economic development as guided by MDG1. They further acknowledge its positive impact in combating poverty among the general populace. The results show that the socio-economic development and eradication of poverty has been negatively affecting both social and economic problems at both the district and national levels. If these challenges are addressed, the results show that there may be evidence to suggest that socioeconomic development and eradication of poverty would thus be effective.

The study further concludes that the socio-economic development and eradication of poverty remains the fulcrum upon which efforts to promote sustainable development rests upon. The results indicated that challenges faced by developing nations with regard to perceptions on foreign aid and poverty eradication ultimately require a prescription in the form of collaborative engagement by various key stakeholders. Existing policies and literature relating to foreign aid that systematically excludes females require rigorous reviews and constant editing to meet the ever changing socio-cultural lives of the citizens. By and large, the study concludes that the effective administration of foreign aid and implementation of poverty alleviation programmes and MDGs require a collective engagement among Government, private and public organisations and civil society to refine the citizens? perceptions in an attempt to combat the high prevalence of poverty and promote sustainable development.

5.3 Recommendations for this study

The following are recommendations offered with respect to the effective administration of foreign aid and implementation of poverty alleviation programmes in developing nations in an attempt to improve its effectiveness in combating poverty and promoting all-encompassing development through MDGs.

There is need for a collaborative approach where various stakeholders would actively disseminate information on the effective administration of foreign aid and implementation of poverty alleviation programmes in developing nations.

Aid to be effective on poverty eradication, must be given on a flexible basis and not tied to a rigid criteria. The move to sustainable growth requires a shift of international financial support from humanitarian assistance to a long term, flexible and sustainable support for development.

Policy makers and Citizens must be staff-developed, trained or exposed to some effective administration of foreign aid and implementation of poverty alleviation programmes in developing nations as key stakeholders so as to share their expectations in order to put constructive input in the mainstream of socio-economic development.

The Governments of developing nations have to adopt a human rights approach to development that pays special attention to equality and non-discrimination; this to avoid wars and violent conflict which continue to disrupt livelihoods, destroy infrastructure, reverse gains and damage the investment climate.

Principal administrators must effectively monitor and evaluate the effective administration of foreign aid and implementation of poverty alleviation programmes in developing nations.

The strong partnership between Government and Developement Partners in many areas such as micro-credit, non formal education and assistance with social mobilization is required to contributed effectively to the successful socio-economic performance and poverty reduction of the country.

This study principally recommends the need for a wider research on a wider scope to establish if some of the findings raised in this study can be generalized.

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APPENDICES

QUESTIONNAIRE ON FOREIGN AID, RWANDA'S SOCIO ECONOMIC DEVELOPEMT AND MILLENNIUM DEVELOPMENT GOALS (MDGs)

A. PRELIMINARIES

My name is MUKARUTESI Claire Marie Michele; I am a student with the Women?s University in Africa Zimbabwe pursuing a Master of Science Degree in Development Studies I am carrying
out a study on the «Impact of Foreign Aid on Rwanda?s socio-Economic Development as guided by Millennium Development Goal I (MDG1).» Your response will be accorded the due respect

Inwhat respect .............................................................................«

Yes No How......................................................................................................«

10. Is there any link between MDGs and Rwanda?s ruling class political ideology?

13. Is foreign aid sustainable in purely Rwanda?s socio-economic development? Yes

Inwhat sense?..................................................................................

Why.........................................................................................................

15. How have been the relations between Government of Rwanda and the Donor Community since 2000-2009?

17. Does Rwanda face technical challenges with regard to implementation of MDGs? Yes

18. Do Donor Community experience attitudinal challenges in their efforts to assist those in needy?

Explain.................................................................................................

This interview is prepared to collect data and essential information relevant to socio-economic impact of foreign aid on development in Gasabo - Rwanda. Your participation in this interview will help to achieve the objectives of the study. The information which you provide will be kept strictly confidential. Thus; you are kindly requested to give your honest response. Thank you!

Kubaka ubufatanyabikorwa mw'iterambere ku rwego rw'isi Combat HIV/AIDS, malaria, and other diseases

Guteza imbere ubwuzuzanye n'uburinganire no guha abagore ubushobozi Reduce child mortality

Frequency %

(62.5%

(37.5%)