There are two ghosts walking across the world: corruption and inequality. They thrive under the shield of growth that many countries have enjoyed during a number of years, not least the poor countries.

Economic growth in poor countries during the last decade means that the UN Millennium Development Goal of halving poverty by 2015 will be reached even this year. The strongest locomotive is China but there are a number of countries achieving record growth rates. IMF estimates that 7 of the 10 fastest-growing economies in the world are in Africa; thus even Africa is making good progress towards the goal of halving poverty.

The main reasons for this progress are domestic policy reforms, high raw material prices, fewer armed conflicts and widening democracy. But even the poorest countries are subject to the economic policy iron law of the new millennium: the faster the growth, the more corruption increases and the more skewed is the distribution of resources.

There are many factors behind the Arab Spring, but in Tunisia the decisive one was the desperation among the well-educated, yet unemployed youth combined with the blatant and growing corruption among the presidential clique.

The pattern of growing corruption and inequality is global. ‘After us the deluge’ seems to be the motto of the leading financial operators all over the world; in Russia, China, Kenya, USA, Sweden. It is hard to understand that they don’t see the writing on the wall.

Global youth unemployment rates of 10-30 % is a certain prescription for social conflict and instability, and thus lower growth and eventually also diminishing returns of capital.

The élite is cutting off the branch it is sitting on―everything is fine and the branch has not broken yet, and we trust the soothsayer’s recipe for forecasting the weather: it will be the same tomorrow as today. And maybe it will, but not forever. And then everyone will ask dazedly what happened, and why now? The answer is: why not before? 

A number of countries are now in the middle of their rising phase with rapid growth combined with worsening corruption and widening gaps. Some of these countries are major recipients of aid from Sweden and other Nordic countries.

We should be discussing our assessment of this development; we can rejoice and even take pride over the increased growth and poverty reduction, which is the very aim of development cooperation. But the growing corruption and the lack of growth trickling down throughout society and out to the villages should be a matter of concern. 

Some conclusions:

• A given consequence should be that the amounts of aid to these countries is reduced; there is no reason to provide more money where it is already plentiful;
• Another conclusion is to direct aid, even more than before, towards governance reforms and to non-government civil society;
• Increase budget support, which gives the possibility to discuss overall developments, from military spending to health care. Project support ensures finance for a project, but cannot affect how the fungible funds thus released are spent. Budget support goes to the budget as a whole but is not given without conditions, whether to Burkina Faso or Greece.
• A rule of thumb for development cooperation needs to be taken off the shelf: if a country is good at growth, help with distribution. Nowadays, therefore, we should support distribution, for example free basic education and health to support women and children.

And if there are no results and we don’t get a response for our ideas, thoughts, proposals or points of view we should withdraw, orderly. This we did for instance in the late 1990s from Angola, which had resources (oil) but not the will to use them for inclusive development. That kind of decisions can hurt, but they must be a vital part of an active development policy. 

Don’t believe that corruption does not exist―whether here or there. Or that it can be controlled away by aid donors. Studies have shown that corruption and double-dealing is much less frequent with aid funds than with tax and customs revenues. What is important then is to support institutions, civil society and a free press. And to dare to be honest. 

Does anyone believe that Greece will get rid of corruption now that they are receiving more billions in support? Or that Afghanistan will be free of corruption when they receive a large increase of Swedish aid next year? 

Sweden used to consider equality important, also for growth. Nordic societies have been held up as a model by many. It has beyond doubt been successful. We should play an important role in the international debate about the increasing gaps, not least in discussions with our development cooperation partner countries. But we are silent now. 

The Swedish minister has a very different message: our aid must become more concrete. The example given is that we should be handing out improved stoves to poor people. If at least it had been to support the development of local production of improved stoves, or to financially support micro-credits for poor people. No, the poor should get stoves, “more action” is the slogan. 

That means disregarding everything about a long-term perspective, sustainability and people’s own responsibility for improving their situation. It means going back at least 50 years in time. It is an embarrassment.