Most aid (= money, food and equipment) is given to the world’s poorest countries to help reduce poverty. Projects paid for by aid money are often aimed at improving local housing and water supply, agriculture, health and education. Training local people is a central part of many programmes. A lot of aid money comes from governments, but development projects are often run with the help of non-governmental organizations ( NGOs ), such as charities. Some charities, e.g. Oxfam , the Red Cross and the Save the Children Fund , run their own aid programmes with money given by the general public. Additional emergency aid is given after natural disasters.
The British government gives over £3 000 million in aid each year to developing countries , especially those which belong to the Commonwealth . British aid is distributed by the Department for International Development . Some aid is given direct to individual countries; the rest is distributed through international organizations such as the European Union , the United Nations and the World Bank. Money is also invested in businesses in developing countries by the Commonwealth Development Corporation . Britain, together with other countries, is helping to reduce the debts of poorer countries and may under certain circumstances cancel debts from Commonwealth countries.
The US began giving foreign aid during World War II , when the Lend-Lease Act made it possible to give military equipment to foreign countries. After the war the US created the Marshall Plan , a $15 billion programme to help European countries rebuild their economies. The US has continued to spend large amounts of money on foreign aid, but has often been criticized for the way it decides who to help. In general, money goes to poor countries that are important to the US for commercial or military reasons. Formerly, the US gave money to countries in Africa, Asia and Latin America so that they would not accept money from the Soviet Union. USAID distributes US foreign aid. In 2003 its budget was over $7 billion. Much of this was spent on US equipment, food and services to be sent abroad.
Two organizations are particularly concerned with training local people. In Britain Voluntary Service Overseas ( VSO ) arranges for skilled people to work abroad for a few years so that they can pass on their skills. They are paid at local rates by the government of the country they are working in. The Peace Corps , a US government agency, does similar work but pays volunteers living expenses and gives them a small allowance.