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In March 2002, the Bush administration unveiled what it deems to be a “new global development compact”: the Millennium Challenge Account (MCA). This new compact builds upon the Millennium Development Goals, e.g. halving world poverty by 2015, put forward by 189 countries at the Millennium General Assembly at the United Nations in September 2000. However, and in stark contrast with the latter strategy, which is aimed at addressing human security issues, the MCA is tied to the objectives of the 2002 National Security Strategy of the United States. As such, the MCA is primarily aimed at bringing excluded states (or, “failed states”) into the bounds of disciplinary role of capital. For instance, one of the most novel, and coercive, features of this development compact is the “pre-emptive” method in which it will administer aid. Under the MCA, only countries that govern justly, invest in their people, and open their economies to foreign enterprise and entrepreneurship will qualify for funding. In what follows, I argue that while the form of the MCA represents an unabashed articulation of U.S.-led imperialism vis-à-vis the poorest regions in the South, witnessed by the growing privatization of development aid and military intervention, its content reflects the same goals and interests that underlie the proceeding development agenda (i.e. the Washington consensus), namely promoting the idea that the “only” path to increased growth and prosperity is to be found in countries’ willingness and ability to adopt policies that promote economic freedom and the rule of law.

Since World War II, the United States has played a leading role in development assistance in both volume of funds and role. Though the largest bilateral development agency, USAID is somewhat of an outlier in modes of operation, scope and nature of activities, and place within government. This chapter examines the development and character of U.S. foreign assistance. Like others, the United States provides foreign aid for multiple reasons – to relieve suffering and promote long-term economic and social development, to gain favor with allies, to open markets, to help ensure national security. Security and diplomacy do play a large role in U.S. foreign aid, even in basic education. In the context of U.S. internal politics, both humanitarian/development and diplomatic/security rationales have been necessary to sustain public and government support for foreign aid. Still neither rationale has prevailed; the budget is split nearly in half. The need for a humanitarian rationale may be characteristic of U.S. foreign assistance along with the emphasis on democracy. Yet these programs have sometimes been distorted by the diplomatic rationale and the security needs of the state. Many of these tensions and the constant need to justify foreign aid likely derive from the perennial periodic isolationist thread of U.S. politics, the particular adversarial institutions of U.S. policymaking, and the transparency which leaves these processes open. Even so, U.S. development assistance has played a prominent role in the trajectory of international development post-World War II, and has worked to address many of the great challenges of the times.

We consider the relationship between external aid and development in Mozambique from 1980–2004, identifying the specific mechanisms through which aid has influenced the developmental trajectory of the country. We undertake both a growth accounting analysis and review the intended and unintended effects of aid at the micro-level. Sustained aid flows to Mozambique, in conflict and post-conflict periods, have made an unambiguous, positive contribution to rapid growth since 1992. However, proliferation of donors and aid-supported interventions has burdened local administration, indicating a need for deeper domestic government accountability. To sustain growth, Mozambique must maximize benefits from natural resources while promoting constructive international market integration.

The paper discusses various important issues of development aid in the context of the emerging new landscape for Official Development Assistance (ODA) and in particular how aid effectiveness issues are now perceived in a world of scaled-up aid. The paper also discusses the overall nexus between aid, growth and domestic policies in aid-recipient countries by reflecting on the relevant ongoing debate in this area. A substantial part of the paper is devoted to the discussion of the central issues involved in development aid, particularly in connection with recent calls in the international development community for scaling-up aid so that the Millennium Development Goals can be attained, as well as the challenging new policy agenda in this regard.

Education for all has become a rallying call among heads of states, international organizations, corporate leaders and transnational advocacy groups. Implementation of EFA goals has also expanded, and today enjoys both new volumes of aid spending and new modes of aid delivery. This chapter considers why the global promise of EFA has moved beyond international rhetoric to action, and explores what the current EFA movement can tell us about the prospects of rights-based and redistributive forms of global governance.

The threat of terrorism is not just limited to a particular nation, rather it has affected the economies of several developed and developing nations. In this study, we have tried to analyze how terrorism has been sought to be tackled and how it can be tackled. In this context, we present the extent to which the method adopted by the USA after the 9/11 attacks, which is popularly called the Global War on Terror (GWOT), has been successful in eliminating terrorism from the world. Only qualitative methodology has been used in this chapter, and most of it has been derived from secondary sources. Through this study, we seek to show that the successes of GWOT have been limited in nature, in spite of tall claims. In fact, what the US has achieved by GWOT in the name of success is the killing of the leaders of some terrorist organizations, successful disruption of their sanctuaries, passing several legislations in order to launch counterterrorism operations, and the freezing the finances of these terrorist organizations by banning some of their charity-based organizations. This chapter lists the gains obtained as a result of GWOT and also highlights what may be called the failures of this global endeavor. Such a proposition aims at showing why GWOT is not only but possibly the best solution to eradicate terrorism. The unexpected outcomes, however, have been many, not only for terrorism but also for international politics, thereby impacting international organizations and also the third-world nations.

This paper examines the recent process of transformation within the World Bank as a series of reactive mediations to the crisis-laden course of capitalist development on a global scale over the last two decades. Two aspects of the Bank’s attempt to construct a new development agenda as a response to contradictions emergent within neoliberal-style social restructuring are highlighted. First, it has embraced the theoretical trends and policy implications of institutional economics. Second, it has refashioned its relations with client countries and their civil societies under the rubrics of “ownership,” “participation” and “empowerment.” The paper proceeds to indicate why the Bank’s current reformulation of development theory presents itself within mainstream theoretical paradigms as an appropriate prescription to counter the crisis of neoliberal-style social restructuring. Concurrently, on the basis of a materialist critique of capitalist development, the paper proceeds to indicate the substantive limits to these present reforms by indicating their theoretical weaknesses and their practical contradictions.

The negative consequences of corruption for a country's development have been identified in Chapter 1. Corruption is ubiquitous and is found in “all political systems, at every level of government, and in the delivery of all scarce public goods and services” (Caiden, 1988, p. 6). Corruption is a universal problem, and governments all over the world have introduced measures to tackle this “social pandemic” which has “many faces” and is “the most challenging obstacle to economic development” (Campos & Bhargava, 2007, pp. 1–2).