From conditionalities to crowding out

The issue of tied aid is a prominent element of the discourse on aid effectiveness (Schraeder et al. 1998; Tingley 2010). As outlined in Chapter 2, one of the main intentions of the OECD-led political process was to untie aid from its political and economic conditionalities (Alesina and Dollar 2000; Berthélemy 2006; Hoeffler and Outram 2011). Even though Egyptian respondents were less familiar with the Paris Declaration, their concerns about conditionalities encased within the practice of aid are remarkably higher and more articulate. This subsection traces possible reasons for the omnipresent suspicion that my Egyptian informants entertained with regard to donor organisations. The following account from an Egyptian high-level government representative reflects the perception that I found among many Egyptians:

It depends. You can´t just put them all in one basket, because each international donor has their own agenda, their own goals and – I mean – their own objectives. [...] I can tell you two things. One thing is that it depends on what kind of aid agency. If you are talking about projects funded by the European Commission or other EU countries, than the answer should be yes.

[...] Sometimes donor X [a US-based agency] is, for example, considered as a way to pressure the [Egyptian] government to do certain tasks. (EG 02)

As the above account also shows, Egyptians regularly distinguished between European and US-based donor agencies, their suspicion being considerably higher towards the latter. This confirms Elagati's (2013, p. 10) findings that “based on the geographic origin of the funds”, Egyptians’ perception varies, generally with

“European funding being the most positive […], followed by Japanese.” Conversely,

“funding from the United States and the Gulf States” (ibid) has a negative connotation. Arab donors were not mentioned or rated at all in any of my encounters.

The reasons for this might be the careful separation Egyptians, particularly within the upper middle class, maintain between their Western, cosmopolitan identities and Arab, nationalistic identities (Wynn 2007).

Why did Egyptians react more suspiciously towards donors’ intentions than Ethiopian informants? Initially, I attributed the prominence of mistrust among my Egyptian respondents to a certain tendency towards conspiracy theories in the Egyptian socio-political discourse (Aziz 2012; Mustafa 2015). The aftermath of the 25^th of January uprising provided abundant material for the production of conspiracy theories that attributed the failure of the political and social transformation beyond January 2011 to the influence of foreign forces. Even though some of the manifestations of conspiracy theories appeared outright funny to outside observers like myself, they were expressions of a “popular xenophobia and paranoia which has been used as a political tool by the former president, Hosni Mubarak, the deposed president, Mohamad Morsi, and the current army-backed regime” (Urquhart 2013, no pagination).

However, the type of issues as well as the demographic niche from which the responses emerge is indicative of the underlying rationale that spurs mistrust. The mistrust against donors is especially high among civil society representatives and

among informants with an upper middle class background. This was especially true for informants with an upper middle class background. Their fears are rooted in the perception that donors undercut prices by providing training either for free or below market prices. As shown by Elagati (2013), Egyptian civil society plays a major role in filling the gaps in social services left by the government. Due to government restrictions on foreign funding (Brownlee 2002; Langohr 2004), however, civil society organisations are often semi-private operations that rely on the sales of their services:

NGO X is afraid that we [GIZ] might come in and destroy the market. They think that we would provide trainings for free, which would mean that no one would attend their trainings unless they make them free of charge, too.

(Research diary, 12/06/2012, Cairo)

However, this criticism of foreign aid is only prevalent among the young, upper middle class NGO representatives. Moreover, it is combined with the assumption that a donor presence paves the way for an economic invasion, as also referred to by Elagati (2013). The following account from an Egyptian NGO representative aptly reflects this perspective:

Maybe this is how the North is getting into developing countries nowadays, you know. They are not getting in directly in the form of companies, but they are coming as development agencies and then from there (Laughs). And from there they give entrance to other companies or sources. (EG 08)

Even though the above accounts confirm Elegati’s work, I suggest that the aversion against foreign interference – be it in the civil society or the private sector – is dominated by a demographic niche, namely that of the charitable segment of the upper middle class. Section 4.2.2 dealt with the social seclusion which led to the geographical and, accordingly, social separation of a rich upper middle class. Due to its history rooted in Sadat’s and Mubarak’s neoliberal economic policies, this segment of society has very strong ties to the private sector (Peterson 2011). The financial and political privileges enjoyed by this segment re-established the suppression and exploitation of the middle and lower classes (Denis 2006).

This almost colonial oppression exerted by the upper middle class is in stark contrast – however somewhat complementary – with their charitable activities. I suggest that the animosity expressed by the young upper middle class citizens towards donors intends to defend the charitable territory previously reserved to their class. The attempt of this foreign educated, internationally oriented youth – who also often bear multiple nationalities – to discredit donors as Eurocentric imperialists (Baaz 2005) legitimises their charitable endeavours and protects the economic stakes of their families. Nevertheless, I acknowledge that a host of other factors – such as their resentment against glass ceiling human resource policies that are prevalent among INGOs – may be at play as well, and that for clarification further research is necessary.