Reforms mean changing the “rules of the game” for more efficient utilization of the available resources. Reforms are one of the major if not the main development factor especially in application to emerging countries and countries in transition from one social system to another. First of all we are talking about political, macroeconomic and global social reforms. Lack of reforms generally means conservation of poverty, social and economic degradation, continuous or accelerating violation of human rights and simultaneously a large incentive for return to the previous regressive type of social relations. Reforms dealing with formation of an adequate legislative, political, social, economic and business climate in underdeveloped country are directly influencing the other three factors of international development.

Lobbying of the political, social and economic reforms is the main function of international development. If there are no reforms, all the other aid-supported measures are having very superficial and unsustainable effect because they do not produce any added social value – they simply do not generate any development impulse. In the best case they represent redistribution of resources in favor of tiny politically powerful minority associated with poverty conservation, in the worst – complete totalitarian dictatorship

Proactive position of donors in lobbying reforms - not simply following either their own short-term political interests or underdeveloped countries’ “strategies” - is essential under the overall political conditions predominant in underdeveloped countries where normally exist extremely powerful state bureaucracy and extremely weak for pushing any reforms civil society. Only if political lobby is successful and if underdeveloped country is eager and ready to follow economic, social and first of all political reforms - aid supported actions make any sense at all. Aid projects by themselves have little lobbying power. Those are the embassies, ministries of foreign affairs and governments of donor countries who possess the major reform lobbying power.    

Reforms are also the most problematic and difficult development component from the point of view of the population at-large of underdeveloped country. They are not only changing economic, political and social rules, but are also significantly deteriorating the social foundations of society. Naturally, that in any society exists a strong opposition to reforms. On the other hand, yet even stronger and even more pro-active opposition to reforms is coming from the ruling social groups. Changes in social architecture are leading towards the loss of their power and first of all towards loss of a variety of economic, material and financial benefits and privileges. In order to overcome these two types of opposition a serious lobbying, compensational and sometimes even conformity buying mechanism is necessary. Role of such compensational mechanism to significant degree is playing the foreign aid. 

Democratization represents one of the major challenges for underdeveloped and emerging societies. In this sense for the sake of prioritization we consider it separately even though in reality it forms an integral part of the earlier identified development component of "reforms".  Democratization can only be promoted together with a combination of the other reforms and is not viable without a lack of adequate measures in legislative, political, social, economic and institutional domains. Democracy can only be sustainable and moreover can only exist when specific development conditions and first of all economic conditions for development are assured. In order to promote democracy people need special skills, certain strength, knowledge and unbiased apprehension of reality, real including financial independence, all of which being primarily based upon economic factors. Democracy cannot be achieved under poor economic performance, under the poverty and hunger. In fact democracy is much more determined by economic factors, than by the social ones. Only affluent and economically independent people and societies - people who can oppose and counteract the State with financial resources, knowledge and information - can build a strong democracy.

In order to build a viable democracy first of all it is necessary to build a strong and rich economy, otherwise there is no any democracy whatsoever. There are no any poor countries in the world, which can provide an example of strong democracy just as there are no any prosperous dictatorships. The process of formation of democratic institutions in underdeveloped society cannot be underestimated. However, a major if not the single factor influencing emergence and consolidation of democratic institutions in underdeveloped society is pressure and lobbying on behalf of the donors. Civil society in underdeveloped countries normally is too weak in order to effectively counteract an enormous inherent State domination.

Democracy is valuable in itself and by itself as a fundamental way of the complete self-expression and development of every human being, as an absolutely necessary instrument for complete realization of personal freedom. In fact under a lack of democracy people are loosing undeniable intangible property rights like would be the right on one’s own spirit, feelings, thoughts, ideas, opinions, apprehension of social reality and finally upon one’s own life. Lack of democracy simply means the most profound limitation of property rights, while any limitation of property rights is very close to an act of robbery. 

If a person cannot freely express his point of view and cannot act correspondingly it means that he is not only deprived from undeniable intangible human rights but that he is also alienated from the tangible property rights, which could have emerged based on actions according to his principles and ideals.

Economic development implies procedures and actions directed towards efficient utilization of available resources based on established rules. Economic development does not necessarily include reforms although some auxiliary reformation of the particular aspects of society and economy may deem necessary in order to achieve better utilization of available resources in the specific sector. Quite possible is a situation when a country is not implementing any reforms but it still has to follow certain (may be “good”, may be “bad”) economic and social policies. There is another fundamental difference between basic societal reforms and economic development. Economic development is lead by commercial institutions and does not necessary require interference at the policy level – interference of the government. On the contrary, profound societal reforms require certain degree of coercion and cannot be carried out except at the state and policy levels.

One of the major differences between reforms and economic development stands in the fact that reforms create a base for social evolution from one type of society to another or from one social construction to another, while economic development actions are rather providing certain development incentives under the current type of social formation. Unlike reforms, economic development policies are not so socially painful. Reforms need to be socially supported and stimulated by additional financial inflows, while measures directed at economic development do not influence comprehensive social base and thus need significantly less efforts and means in order to attain ample social support or at least social compliance. 

Foreign aid means additional external resources for accomplishment of the three development tasks identified above – reforms, democratization and economic development. Foreign aid both directly and indirectly (through buying opposition to strategies and policies aiming at national development) is influencing realization of the other three development components.

Although classification of aid and aid resources differs among donors and international organizations, we can clearly identify four major forms of aid delivery:

-   Loans (reimbursable financial aid)

-   Grants (non-reimbursable financial aid)

-   Technical assistance

-   Humanitarian aid

Aid represents an international tool aiming to achieve national (not merely governmental) development priorities. Another powerful international tool for national development and reforms is represented by political and economic influence of economically developed nations. In fact donors’ political and economic pressure and foreign aid should always come together and provide a single international package lobbying national development. Such a lobby is absolutely necessary in order to approximate short-term interests of the underdeveloped countries’ governments to the short and long-term interests of the underdeveloped countries’ people.   

Development industry at the moment is in the serious crisis (if not in disastrous situation), which is manifested by the following fundamental considerations:

·   Very few countries are achieving real substantial outcomes as a result of an application of international aid. Speaking otherwise very few countries are transferring from a category of “underdeveloped” to a category of “economically developed”.

·   A lot of aid recipes and principles are based upon unsustainable social idealism and hardly can produce any viable results. The main reason for that is a substantial misunderstanding of social realities on behalf of donors and even inside the donor countries themselves.

·    Huge and devastating interconnection of development industry either with the “bad” diplomacy roughly promoting donors’ national interests (in the best case) or with the “good” diplomacy based upon false apprehension or misunderstanding of social realities and promotion of unsustainable social idealism (in the worst case). Both types of diplomacy are enormously harmful for international development

·    Profound social mendacity on international arena immensely projected upon international development industry combined with a lack of any social principles clearly and unquestionably supported by all economically developed countries partly due to a stubborn promotion of the donors’ short-term political and economic interests, but mainly due to an idealization of international social processes on behalf of the donor countries

·    Aid is mainly provided to the States and the governments, which are the least co-interested institutions in any reforms and social changes, not even mentioning direct opposition of their interests to interests of the people in underdeveloped countries

Stipulations of Paris declaration and Accra agenda for action are predetermining particularly important components of the new “vision” or of the new deal for international development. However, most imperative of them together with associated policies are producing a great deal of questions leading to major controversy and inconsistencies being based upon the fundamental causes of crisis in development industry.

Predictability (“country systems – partner country systems will be used to deliver aid as the first option, rather than donor systems”). Since majority of underdeveloped countries are dictatorships, semi-dictatorships or countries with cosmetic democracy, “partner country systems” mostly represent legally and illegally corrupted and absolutely inadequate mechanisms (including, first of all, state budgets) based upon private ownership of the State and all state resources by national dictators together with their associates. This concept, in fact, much more relates to aid ownership and it is not entirely clear why it is configured under “predictability” principle

Aid ownership. Conception of aid ownership by underdeveloped countries received a significant attention in the modern world. It is having a straightforward inherent controversy, which significantly downgrades any good intentions. Aid ownership is equalizing proprietorship and interests of the people and those of the State, which is absolutely preposterous for underdeveloped society. Besides a clear-cut fact that in underdeveloped countries the very ownership of the state is very far from being a prerogative of the people, normally these countries neither possess political and social preconditions nor institutional capacities for producing any development programs. Interests of the major stakeholders in political process (of governments and States) are normally incoherent and opposite, to urgent development requirements. Major objective of international development - economic, political and social reforms – is hardly ever realizable if underdeveloped countries’ leadership will select a development agenda itself.

We have to remember that interests of the State and those of the people especially in the countries with poorly developed democracies are absolutely not the same and State policy in no way can be considered as people’s policy, rather vice a versa most of the time it is directed against interests of the people.

In interests of the people of underdeveloped countries as well as of a mankind generally is not only for the aid to be managed by donor countries, but preferably even for the underdeveloped countries themselves to be governed by economically developed nations. It is basically only non-socialized interests of underdeveloped States and of the top-level state bureaucracies in underdeveloped countries directed against their own people what advocate emotional and degrading patriotism and national independence. People must have the right to choose their own State and not only through emigration, but even preferably making to emigrate their national State and import the civilized economically developed country ruling

Not even saying that there is no such thing as a variety of economic recipes for national development, which are applicable under particular circumstances. There is only one single fundamental set of rules, which have to be followed in order to reach the preconditions for national development. This set of rules may be followed with higher or lower intensity and that only means that the country is pursuing development objectives faster or slower. But there is no any alternative for harsh and tough recipes of national development – there is no any national specific whatsoever. To claim otherwise means completely misunderstand not economy, but society – not economics, but sociology

Capacity building versus knowledge transfer. Capacity building is one of the main actions supporting economic development. Lately capacity building is considered to be of even greater importance than know-how or knowledge transfer. From one side no knowledge transfer is possible without capacities in place or without people and institutions to which the knowledge should be transferred – a lack of capacities certainly is the main barrier on the way of knowledge transfer. On the other hand, what for the capacities are needed if they are grounded on the obsolete knowledge? We must clearly understand that when there is no transfer of knowledge, capacity building is leading to conservation of regressive social and institutional relations and does not have any value; vice-a-versa it is becoming detrimental to national development. Today capacity building concept is enormously abused and reduced in reality mostly to additional camouflaged sources of income for people in the public administration of underdeveloped countries.

Fighting corruption. Strangely enough is understood in modern world the phenomenon of fighting corruption. Generally speaking prevails an apprehension that national government is a sort of warrior against corruption or at least is distanced from corruption, while the main corrupted structures are medium and low levels of public administration. This, however, is very far from reality. Corruption is understood very narrowly – as an out-of-law or illegal corruption. In reality, corruption is much more profound phenomenon first of all based upon corruption in social relations, which is normally quite legal. Main institution responsible for corruption in social relations is the government or the State. All the corruption in any type of society starts with the government and with the state. What people usually understand under corruption - illegal corruption - is only a follow-up or a superficial expression of the much deeper process of corruption in social relations, which is a perfectly legal process. In order to fight corruption, especially in the underdeveloped countries, it is necessary to fight societal construction, the government and the State, while all anti-corruption measures do exactly the opposite – further corrupt the government with additional financial resources supplied by donors and international organizations – that is why they are almost one hundred percent inefficient, not to say harmful.

Results (“developing countries and donors shift focus to development results and results get measured”). Major argument against results-based approach is that in reality it is very difficult to determine what kind of results have to be achieved. There is a huge difference between “doing things right” and “doing right things”. Objectives of any development program are subjective, biased and partial. Achievement of predetermined results or objectives does not yet necessarily mean that correct and constructive results were reached; not only negative, unsustainable or harmful results can be achieved as well, but most of the time exactly this kind of results are predominantly reached in international aid. Results-oriented aid is having ambiguous short-term impact and need to be exchanged for long-term reform process-oriented actions.

 

Mutual accountability (“donors and partners are accountable for development results”). This is also a rather superficial and subjective criterion significantly coupled with the previous one. Who is to judge about accountability and about achieved results? To whom donors and governments are accountable if at all? What is the mechanism of accountability, moreover when diplomatic considerations are involved - not even mentioning a variety of opposite and contradictory interests, visions and opinions dominating development programs? International organizations delivering a majority of aid in modern world are almost absolutely uncontrolled and unaccountable, while authoritarian or even totalitarian governments of underdeveloped countries are even less accountable to anybody. How then, such a combination of almost absolutely uncontrolled institutions can be held accountable at all?

 

Conditionality (“donors will switch from reliance on prescriptive conditions about how and when aid money is spent to conditions based on the developing country’s own development objectives”). Underdeveloped countries with authoritarian governance regimes and with enormously powerful state bureaucracies combined with a rather weak civil society do not have any development objectives with very rare exceptions. Any changes are never on the agenda of power holders; they simply do not want any changes ever. That is all the “development agenda” of the underdeveloped countries. Therefore, any “development objectives” of underdeveloped countries or mostly of their governments is a complete nonsense or a fairy tale. Plus to that donors are almost never suspend aid delivery even in relation to countries, which pursue neither reforms, nor democratization. Major actions leading to aid suspension are being mostly initiated by particular underdeveloped country through a breach of diplomatic and political relations. Even severe totalitarian dictatorships with an absolute lack of reforms but with a suitable rhetoric may receive significant development funds. Normally donor countries would not even decrease aid resources in case of conditionality incompliance and continue to finance political regimes of low social value with low aid absorption capacities in fear of damaging bilateral diplomatic relations. Instead they prefer to damage their image among the most intelligent and educated parts of population in underdeveloped countries, which are probably the major hope both for national development and for sustainable friendly bilateral relations with the very same donor country in the longer-term perspective.