Foreign Aid: Growth and Governance Go Together

Dr. Anne-Marie Slaughter, the Director of Policy Planning for the State Department, recently spoke at at a conference  hosted by the Center for International Private Enterprise (CIPE) called “Democracy that Delivers.” In her remarks  (PDF version available here), Slaughter emphasized the reinforcing relationship between economic growth and good governance.

Slaughter not only explained why the U.S. should provide assistance to countries that are committed to democratic reform, but why such countries are more likely to reap the benefits of such assistance. Specifically, she discussed how economic growth creates stakeholders in the rule of law, the necessity of democracy to cultivate market opportunities, how democracy builds trust necessary for economic growth, the need for self-reliant democracies, and the need for democracies to create economic safety nets.

According to the CIPE blog, “making democracy deliver is one of the most fundamental challenges of development that can only be achieved when democratic and market institutions go hand in hand.”