Making Foreign Aid Work: Navigating the Aid Localisation Conundrum

Swetha Ramachandran |

Development assistance funding by international donors is rarely channeled through local actors. While there are strong normative and practical arguments to localize funding (i.e. directly channel funding through local actors), progress has been piecemeal as donors are largely left to their own devices to decide how/when/where and how much to localize. In my first dissertation paper, I explored the question of ‘How and why do donors vary in their extent of localization (as defined by the use of local channels to disburse aid funding)?’, focusing on the aid-dependent context of Sierra Leone. Thanks to the support from the UACES grant, I was able to conduct interviews in Freetown, the capital of Sierra Leone, in November 2022. The UACES funding also contributed to a follow-up visiting fellowship at UNU-WIDER in Helsinki during the spring of 2023, where I received constructive feedback from esteemed experts in domains of international development and foreign aid.

Guided by Dr Rachel Gisselquist and Dr David Sylvan, the findings of my research were published as a working paper, revealing significant insights into the localization patterns of donor-funded projects. Notably, the research highlighted that projects funded by multilateral donors tend to be more localized compared to those funded by bilateral donors. Additionally, the nature of aid assistance, whether through loans or grants, emerged as a key determinant in the utilization of local channels.

Surprisingly, despite the apparent localization of projects funded by multilateral donors, there was no evidence to suggest that such initiatives were more impactful or participatory than those supported by other donor types. This paper, recognized with the Edward Said Graduate Student Paper Award by the Global Development Studies section of the International Studies Association (ISA), is currently undergoing the journal review process, marking a significant milestone in my academic journey.

I extend my deepest gratitude to UACES for contributing to my funding that enabled this research initiative. UACES’ support has not only propelled my academic pursuits but has also helped contribute to the timely debate on localization of development assistance.