The Netherlands says it will stop giving Kenya aid in the next four years on account of the country’s “significant” economic growth.
Dutch Minister for Foreign Trade and Development Cooperation Lilianne Ploumen told the Dutch Parliament this week that the relationship between the Netherlands and Kenya — after 2020 — can be labelled “trade partners” only, hence the decision to scrap aid.
Ms Ploumen said in a statement outlining the new direction between the two countries that the Kenyan economy had grown significantly over the past decade.
The move is expected to impact Dutch support for programmes in Kenya ranging from good governance and human rights, business climate, food security, environment and sanitation as well as culture and sports.
The Netherlands and Kenya have been close development partners since independence in 1963.
The total amount of Dutch development via channels other than the bilateral channel was estimated at Sh16.9 billion (€150 million) in 2011, according to Dutch official figures.
This includes contributions to more than 30 co-financing organisations — about Sh2.8 billion (€25 million a year).
The financial support flows to Kenya via NGOs and UN organisations. In 2011, the Netherlands spent about Sh1.5 billion (€13 million) on development cooperation with Kenya.
Dutch bilateral development cooperation with Kenya started in the early years of Kenya’s independence and has had a rocky history.
After the inauguration of President Kibaki in 2002 and based on his economic recovery plan, the Netherlands intensified the development cooperation. In 2006, the bilateral relation was reduced due to corruption in Kenya.
“The disputed results of the General Election in December 2007 and the subsequence post-election violence required a reconsideration of Dutch bilateral policy with regard to Kenya,” says a brief in the website of the Dutch Embassy in Nairobi.
Kenya’s GDP increased to $55.2 billion in 2013 after rebasing from $44.1 billion, a 25.3 per cent jump, surpassing the government’s prediction of 20.6 per cent.
This saw Kenya classified as a middle-income country after the statistical reassessment of the economy.
President Uhuru Kenyatta has in the past urged fellow African leaders to stop relying on foreign aid, saying it will not lead to prosperity.
“Dependency on giving that only appears to be charitable must end,” he said last year ahead of an African Union summit in South Africa last year. Aid is estimated to account for 5-6 per cent of Kenya’s total income.
Mr Kenyatta said then that foreign aid “often carries terms and conditions that preclude progress”.
“It is time to give it up,” he said.