Are Private Actors Revolutionizing Foreign Aid?

Are Private Actors Revolutionizing Foreign Aid?

Foundations are stepping up their engagement in Sub-Sahara Africa. But will that fundamentally alter the dynamics on the ground?

When Warren Buffett donated $30 billion to the Bill and Melinda Gates Foundation a few years ago, many observers heralded the arrival of a new age of private philanthropy in the Carnegie and Rockefeller tradition. Particular attention has been paid in recent years to the growing engagement of philanthropic foundations in international development, and especially in Sub-Saharan Africa. Enthusiasts have pointed out that foundations offer a new and significant source of financing for development, with the potential to outstrip official development assistance. Others have suggested that foundations can fundamentally change international development through their more flexible and innovative approaches and superior management style.

Bilateral as well as multilateral donors started to notice as well, commissioning a range of studies to explore the implications of the rise of foundation engagement for the "international aid architecture," and potential ways for leveraging private money for their programming. Some, like the International Finance Corporation (IFC) or the U.S. Agency for International Development (USAID) have launched programs designed to foster creative partnerships with these foundations.

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