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Buhari's trip to China, See What Bill Gates says about Nigeria

Buhari’s trip to China, See What Bill Gates says about Nigeria

Who Should Get Foreign Aid

Lately I have been reading and thinking about an incredibly important issue that gets too

little attention—even among global-health obsessives like me. If we don’t deal with it, it could be a dramatic setback for the world’s efforts to fight extreme poverty. If we do, we will lay the foundation for helping millions more people escape poverty. Later this month I’ll be joining some meetings in Washington, D.C., on this issue, and I want to give you a preview of what we’ll be talking about.

I should start with a little context, and some amazing progress that you may not know about: There are fewer poor countries in the world today than there have ever been. Since 2000, the number of low-income countries has fallen from 63 to 34—a drop of nearly 50 percent! China is the best-known example, but there are dozens of others including Brazil and Mexico. South Korea, which received enormous amounts of aid after the Korean War, is now a net donor. And I expect this trend to continue: By 2030, there will be almost no poor countries left.

 Even though there will be fewer poor countries, there will still be very poor people.

Unfortunately, this silver cloud has a dark lining. Even though there will be fewer and fewer poor countries, there will still be very poor people. And they will be concentrated in fewer places—many of them the very same countries that are moving out of the low-income tier and into middle-income status. Today 70 percent of the world’s poorest people live in middle-income countries, and that percentage will likely go up in the coming years.

Why does that matter? Because most development agencies, such as the World Bank, use a country’s average income as the main factor in deciding whether it qualifies for aid. So the countries that are crossing the threshold into middle-income status risk losing much of the aid they’ve been getting (which includes grants, low-interest loans, technical assistance, and other kinds of support). In the next few years India, Ghana, Nigeria, Pakistan, and Vietnam stand to lose as much as 40 percent of their total development assistance.

You could argue that this is exactly how it should work. As countries get richer, they should be able to take care of their own. In fact that is exactly what’s happening in many developing countries—particularly the

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