Opinion piece Volkskrant

Global Trade Inequality: Why Aid Misses the Point

My opinion piece was published in de Volkskrant today.

Many people don’t realize that for every dollar of ‘aid’ that flows from the Global North to the Global South, we extract 30 dollars back from the Global South due to unequal trade (Hickel et al., 2022).

And yet Dutch politicians keep debating whether to cut the aid budget.

We're arguing about the wrong thing.

Here's the uncomfortable reality:
1️⃣ 𝐓𝐫𝐚𝐝𝐞 𝐫𝐮𝐥𝐞𝐬 𝐚𝐫𝐞𝐧'𝐭 𝐞𝐪𝐮𝐚𝐥 – Wealthier countries have more negotiating power in trade agreements and more say in the World Trade Organization. This often means their products – many of them government-subsidized – can flood African markets.

2️⃣ 𝐀𝐟𝐫𝐢𝐜𝐚𝐧 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐞𝐬 𝐚𝐫𝐞 𝐬𝐪𝐮𝐞𝐞𝐳𝐞𝐝 𝐟𝐫𝐨𝐦 𝐛𝐨𝐭𝐡 𝐬𝐢𝐝𝐞𝐬 – In Kenya, farmers and agri-businesses compete against imported wheat and processed food – while also depending on imports for fuel, agri-inputs, packaging and machinery. It's a structural disadvantage baked into the system.

3️⃣ 𝐓𝐡𝐢𝐬 𝐩𝐮𝐬𝐡𝐞𝐬 𝐞𝐧𝐭𝐫𝐞𝐩𝐫𝐞𝐧𝐞𝐮𝐫𝐬 𝐢𝐧𝐭𝐨 𝐚 𝐜𝐨𝐫𝐧𝐞𝐫 – To survive on globalized markets, Kenyan agri-entrepreneurs are often pushed toward co-called ‘cash’ crops like tea, coffee, or luxury vegetables – and even then, mostly as raw materials. The higher-value processing happens elsewhere.

4️⃣ 𝐃𝐞𝐛𝐭 𝐟𝐢𝐥𝐥𝐬 𝐭𝐡𝐞 𝐠𝐚𝐩 – The resulting trade deficit means African governments need foreign currency – often borrowed from the IMF or World Bank. With attached neoliberal conditions – open your markets further, limit subsidies, cut public spending – that the currently rich economies never followed when they were building their own economies.

🔄 𝐀𝐧𝐝 𝐭𝐡𝐞 𝐜𝐲𝐜𝐥𝐞 𝐜𝐨𝐧𝐭𝐢𝐧𝐮𝐞𝐬.

The Kenyan agri-businesswomen I interviewed for my PhD research were very aware of this dynamic. They weren't asking for charity. They were asking for a level playing field – trade rules that let them build their businesses, add value locally, and grow their own economies.

It’s time to move beyond the discussion of aid and talk about rewriting the rules of global trade.

🔗Read the opinion piece "Wat vinden Afrikaanse ondernemers zelf van onze eerlijke’ hulp en handel?" (in Dutch)

📖 Read my full dissertation "Agri-businesswomen and development in Kenya. Agents of change?" (in English)