IRB32003: INTERNATIONAL POLITICAL ECONOMY

ARTICLE ASSIGNMENTS:
THE DISADVANTAGES AND ADVANTAGES OF LINKING CORRUPTION, FOREIGN AID,
AND WELFARE TO THE POOR.

PREPARED BY:
1. JANNATUL HUSNA BINTI HASAN AGHARE (060090)
2. NUR A’FIFAH BINTI MOHD JAMIL (059839)
3. SITI ZULAIKHA BINTI KAMARUDDIN (059225)

PREPARED FOR:
DR. SUYATNO LADIQI
 TABLE OF CONTENT

Abstract............................................................................................................. 2
1.0 Introduction................................................................................................. 3
2.0 Advantages................................................................................................... 3
3.0 Disadvantages.............................................................................................. 5
4.0 Conclusion................................................................................................... 6
4.0 References....................................................................................................7

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 THE DISADVANTAGES AND ADVANTAGES OF LINKING CORRUPTION,
FOREIGN AID, AND WELFARE TO THE POOR
Nur A’fifah Binti Mohd Jamil, Jannatul Husna Binti Hasan Aghare, Siti Zulaikha Binti
Kamaruddin
Department Faculty of Law and International Relations, Universiti Sultan Zainal Abidin
(UniSZA), Kampus Gong Badak, 21300 Kuala Nerus, Terengganu.

Abstract
The complex interrelationships between welfare, foreign assistance, corruption, and poverty
within the context of global political economy are examined in this article. It looks at how
corruption might make it difficult for foreign aid meant to fight poverty and fund social
welfare initiatives to be distributed effectively. The article emphasises how corrupt practices,
such as embezzlement and bribery, harm those who are supposed to benefit from them,
especially the poor. Additionally, it talks about how foreign aid faces difficulties like
conditionality and a lack of accountability that might restrict how successful it is in
advancing sustainable development. However, the essay acknowledges how foreign aid might
enhance the welfare of the underprivileged by boosting investment and infrastructure
development. The essay emphasises the need of fighting corruption and bolstering
governance structures in order to increase the effectiveness of foreign aid. Overall, this study
helps us comprehend the intricate relationships between welfare, poverty, foreign aid, and
corruption. It also offers policymakers guidance on how to address these issues within the
context of the international political economy.

Key words: Corruption, Foreign aid, Poverty, and Welfare.

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1.0 Introduction

The interaction of corruption, foreign assistance, welfare, and their effects on the welfare of
the poor have come under close examination in the field of international political economics.
With a focus on both the benefits and drawbacks that result from these relationships, this
essay tries to explore the complicated dynamics underlying this intricate interaction. We may
comprehend how these elements affect the socioeconomic environment for underprivileged
communities throughout the world more fully by looking at the complex web of corruption,
international aid, and welfare services.

The article also tries to emphasise the multifaceted nature of poverty and how it
intersects with foreign aid and corruption. Poverty is not just an economic problem; it also
has social, political, and institutional aspects that are intricately woven into IPE. We may
learn more about the larger processes of power, governance, and resource allocation that
influence the wellbeing of the poor by examining the complicated linkages between
corruption, foreign aid, and poverty. Designing successful policies and initiatives that may
tackle poverty holistically and advance sustainable development requires an understanding
of these processes.

The article also tries to emphasise the multifaceted nature of poverty and how it
intersects with foreign aid and corruption. Poverty is not just an economic problem; it also
has social, political, and institutional aspects that are intricately interconnected into IPE. We
may learn more about the larger processes of power, governance, and resource allocation
that influence the wellbeing of the poor by examining the complicated linkages between
corruption, foreign aid, and poverty. Designing successful policies and initiatives that may
combat poverty holistically and advance sustainable development requires an understanding
of these processes. For policymakers and practitioners looking towards developing successful
solutions that maximise the beneficial impact on the poor while minimising the risks
associated with corruption, understanding the advantages and drawbacks inherent in this
connection is essential.

This article will explore the complex connections between corruption, foreign
assistance, welfare, and their effects on the welfare of the underprivileged within the
framework of the global political economy. We can fully comprehend the difficulties and
possibilities that result from these linkages by looking at both the benefits and drawbacks.
The ultimate goal is to educate decision-makers, academics, and practitioners on possible
tactics and approaches that might maximise the good impact on the lives of the poor while
minimising the hazards connected with corruption and assistance reliance.

2.0 Advantages

First, the advantages of linking corruption, foreign aid and welfare to the poor are
transparency and accountability. Promoting openness and accountability in the allocation
and management of funds is made possible in large part by connecting corruption to
international aid and welfare programs. It establishes a system of checks and balances that
aids in spotting situations when dishonest authorities could abuse aid meant for the
underprivileged. Establishing distinct connections between corruption and the distribution
of cash makes it simpler to monitor and investigate irregularities, preventing the misuse or
diversion of funds for selfish purposes. Through more openness, the public and important
stakeholders can evaluate the financial flow, scrutinise the decision-making procedures, and
hold those in charge of running the aid and welfare programs accountable. The public can
see more clearly how their taxes or donations to foreign aid are being used thanks to this
openness, which contributes to the growth of public trust and confidence in the system.

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 Additionally, it promotes open communication and involvement between the public,
assistance organisations, and the government, creating a climate of shared accountability. A
further benefit of connecting corruption to welfare and foreign aid programs is that it makes
it easier to find and put a stop to corrupt behaviours. Governments and aid organisations can
create effective monitoring systems and put anti-corruption measures in place by examining
patterns and identifying regions prone to corruption. This can involve enhancing financial
controls, putting in place independent audit processes, encouraging whistleblower
protection, and looking into potential corruption instances. By acting in this way, corruption
is discouraged and the money intended for the needy is effectively distributed to those who
will benefit from it.

Next, advantages of linking corruption, foreign aid and welfare to the poor are
effective utilisation of foreign aid. The successful use of funds intended for programs that
reduce poverty and promote development depends on establishing a link between corruption
and foreign aid. Foreign aid is at great risk of not being used effectively because of
corruption, which takes money away from its intended use and puts it in the hands of
dishonest people. By creating this connection, governments and relief agencies can put
policies in place to stop money from being embezzled or used for personal benefit, protecting
the intended impact of aid on the underprivileged. The improvement of financial controls
and accountability systems is one method of preventing corruption. As part of this, aid
monies must be tracked in a transparent and auditable manner so that they can be
appropriately distributed and used to achieve the desired goals. It is harder for corrupt
persons to manipulate or embezzle the cash when there are clear guidelines and monitoring
mechanisms in place, which increases the possibility that the aid will reach the intended
recipients. Linking corruption to foreign aid can also benefit in identifying and resolving
structural problems in recipient nations. It pushes governments to deal with fundamental
governance problems like shaky institutions, a lack of transparency, and insufficient
supervision. Foreign aid can be directed more efficiently, fostering sustainable development
and poverty reduction, by addressing these corruption's underlying causes. Additionally, it
motivates recipient nations to tighten their management of assistance resources, increase
accountability, and boost governance to foster a more favourable climate for growth.

Furthermore, to empower the poor and guarantee that they receive the help and
benefits to which they are entitled, it is essential to combat corruption in social programs
when linking corruption, foreign aid and welfare to the poor. Corruption in social programs
can result in the misappropriation or diversion of funds, depriving the poor of the support
they require. Governments can create transparent, accountable systems that put the welfare
of vulnerable communities first by fighting corruption. By giving them access to basic
services like healthcare, education, and social safety nets—all of which are critical for ending
the cycle of poverty—this empowers the poor. The general well-being of vulnerable groups is
improved when corruption is adequately combated, which also helps to reduce poverty.
Corruption-free programs can reduce poverty by supplying the needy with the means to meet
their basic requirements and enhance their quality of life. This is done by ensuring that
welfare resources are distributed to the intended recipients. Because they have more access
to healthcare and education, which are necessary for social and economic mobility, the poor
are empowered through anti-corruption welfare programs and are therefore able to engage
in society more actively. Furthermore, when the underprivileged receive the assistance and
benefits to which they are entitled, it promotes a sense of dignity and respect, enabling them
to participate in the decision-making processes that have an impact on their life.

Sustainable development in underdeveloped areas depends on eliminating corruption

in the distribution of aid and welfare. The effective distribution of resources is hampered by
corruption, which takes money away from vital areas like infrastructure, education,
healthcare, and livelihood development. Resources can be directed more effectively and
efficiently toward sustainable development projects that primarily help the poor by tackling

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corruption. It is possible to build crucial infrastructure in underdeveloped areas when
resources are allocated effectively. The essential infrastructure for raising living standards
and promoting economic development comprises roads, bridges, schools, hospitals, and
water and sewage systems. Since they provide people with knowledge and skills while also
safeguarding their wellbeing, access to healthcare and education is essential for ending the
cycle of poverty. Poor people can receive high-quality healthcare and education services,
increasing their human capital and productivity, by channelling resources in an uncorrupt
manner.

Lastly, advantages in linking corruption, foreign aid and welfare to the poor is
improving international collaboration in the fight against corruption is facilitated by
connecting corruption to foreign aid. When corruption is acknowledged as a widespread
issue in assistance distribution, it presents a chance for donor nations, recipient nations, and
aid organisations to unite and engage in cooperative efforts. To do this, it may be necessary
to collaborate on initiatives to reduce corruption risks and advance openness in assistance
disbursement, as well as to share best practices, experiences, and expertise in
anti-corruption measures. Countries and organisations engaged in foreign aid can work
together to develop policies and methods to reduce corruption risks and improve resource
utilisation by fostering conversation and cooperation. This can involve setting up
collaborative frameworks for monitoring and assessment, carrying out audits and
investigations, and exchanging data on dishonest behaviour or suspicious activity. Such
cooperative methods develop information sharing, trust among stakeholders, and a shared
commitment to eradicating corruption.

3.0 Disadvantages

Corruption, foreign aid, and welfare for the poor all have drawbacks in various ways. There
are possible drawbacks to directly relating these issues to the wellbeing of the poor, even if it
is crucial to combat corruption and ensure effective use of foreign aid. There are a few
disadvantages of linking corruption, foreign aid and welfare to the poor.

The first disadvantage is, it can discourage the foreign aid. Donors may be less likely
to contribute if they think their money will be wasted on corruption. The poor, who depend
on foreign help for basic services like healthcare and education, may suffer as a result.This is
due to the fact that they want to guarantee that their funds are utilised to aid the
underprivileged. They might opt to donate to other groups or causes if they think their
money will be misused by dishonest officials. For the poor, who depend on foreign help for
necessary services like healthcare and education, this may have a negative effect. As a result,
it may become more challenging for the poor to achieve their basic necessities when foreign
help is cut back on or eliminated altogether.Additionally, if donors are less likely to provide
foreign help, it may be more challenging for developing nations to meet their development
objectives. This is due to the fact that foreign aid can contribute significantly to the funding
of development initiatives like the provision of clean water and sewage systems, as well as
the construction of schools and hospitals.

The second disadvantage is discouraging the welfare programs. People may be less
likely to support welfare programmes if they think they are simply a mechanism for the poor
to receive money without working. The poor, who may depend on benefits to cover their
basic necessities, could be negatively impacted by this.This is because they could think that
spending their tax money on those who are unwilling to help themselves is a waste.
Furthermore, social cohesiveness may suffer if charity programmes are discouraged. This is
due to the potential for it to exacerbate the gap between the impoverished and the rest of
society. While the non-poor may view the poor as entitled and dependent, the impoverished
may view the non-poor as callous and egotistical.

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 The third disadvantage is stigmatising the poor. The poor can be stigmatised by being
associated with corruption, foreign aid, and welfare, leading them to believe that they are to
blame for their own poverty. They might find it harder to escape poverty as a result, which
could also result in social marginalisation. First off, it can give people the impression that the
poor are helpless and dependent. This can cause people to have a negative opinion of the
poor and assume bad things about them. Second, it may cause the impoverished to believe
that they are to fault for their own state of poverty. For the impoverished, this can be a
profoundly demoralising experience that makes it harder for them to trust in themselves and
their capacity for success.Third, it may result in prejudice against the poor. Due of this, it
may be more challenging for the poor to get employment, housing, and other resources.
Their ability to participate in society may also become more challenging. Numerous
detrimental effects may result from the stigma of poverty. It can make it harder for the poor
to escape poverty, it can result in social marginalisation, and it can harm their physical and
mental health.

Lastly, as important as it is to combat corruption, advance efficient international aid,

and create well-targeted welfare programmes, it is also crucial to tackle these problems
delicately, avoiding generalisations and prejudices that could endanger vulnerable
communities.While corruption can hinder the efficiency of welfare and foreign aid
programmes, it is crucial to remember that other factors also play a role in whether these
initiatives are successful or unsuccessful. There are numerous elements at play, including
governance, the application of policies, and accountability systems.

4.0 Conclusion

Several substantial conclusions may be drawn from the complex relationships between
corruption, foreign aid, and welfare programs. In order to make sure that money is
distributed fairly and managed effectively, transparency as well as responsibility must be
given top priority. Furthermore, efforts should be taken to reduce corruption by
implementing efficient monitoring systems, anti-corruption policies, and stakeholder
collaboration. Subsequently, while developing comprehensive policies and programmes, it is
crucial to acknowledge and address the multifaceted character of poverty, taking into
account its institutional, political, and social facets. In addition, sustainable development
and poverty reduction depend heavily on the poor's participation in decision-making
processes and empowerment. At last, it's necessary to address these concerns delicately,
avoiding discriminatory the impoverished and encouraging dignity and respect for everyone.
We have the opportunity to work towards a better future where corruption is reduced, aid is
used wisely, and the welfare of the underprivileged is enhanced by implementing these
values into practice.

Achieving a balance between preventing corruption and maintaining effective aid and
welfare programs while avoiding adverse impacts for the poor is a must if we desire to bring
forward a brighter future. Disclosure, reliability, and the implementation of effective
monitoring and anti-corruption mechanisms should be given top priority by policymakers
and practitioners. This involves fostering collaboration between donor nations, recipient
countries, and donor countries so they may exchange knowledge and best practises for
combating corruption. Understanding the complexity of poverty and addressing its social,
political, and institutional dimensions, efforts should also be made to prevent discrimination
and enhance the dignity and empowerment of the poor.

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4.0 References

Thapa, I. (2020). Foreign Aid: Positive and Negative Impact in Developing Countries.
ResearchGate. https://doi.org/10.13140/RG.2.2.19155.81448 (accessed on 22 June 2023)
DevelopmentAid. (n.d.). DevelopmentAid.
https://www.developmentaid.org/news-stream/post/80/80-2 (accessed on 22 June
2023)

Lucy Koechlin. (2008, December). Poverty and Corruption: About Poorer and Richer Ways
of Life.
https://jam.baselgovernance.org/api/assets/72c41611-526b-42e0-b909-149bcd4b40
5f (accessed on 22 June 2023)

Transparency International. (n.d). Review of literature on the link between corruption,

poverty and conflict, and evidence of the impact of corruption on donor interventions.
https://www.transparency.org/files/content/corruptionqas/Review_of_literature_o
n_the_link_between_corruption__poverty_and_conflict__and_evidence_of_the_impact_
of_corruption_on_donor_interventions_2013.pdf (accessed on 22 June 2023)