THE ROLE OF DEMOCRACY IN THE SELECTION OF AID RECIPIENTS A Case Study Investigating the Decision-Making Process of the Swedish International Development Cooperation Agency (Sida)

Abstract

This thesis aims to explore how the level of democracy in recipient countries affects the decision-making process of the Swedish International Development Cooperation Agency (Sida) when determining whether to provide aid to state or non-state actors. While existing research has predominantly focused on donor motivations and interests based on aid allocation patterns, little attention has been given to the selection process employed by donor agencies and the factors that guide this process. This study seeks to address these research gaps by adopting a mixed-methods approach within a case study research design. The analysis incorporates secondary quantitative data, such as trends in aid allocation, trade relationships, democracy levels, and government quality of recipient countries. Additionally, primary data is collected through semi-structured interviews with current or former high-level officials from Sida, the Ministry for Foreign Affairs, and the Expert Group for Aid Studies (EBA). Interestingly, the research findings suggest that the decline in democracy levels in recipient countries has a more significant impact on Sida's selection process than the absolute level of democracy. Although democracy levels are considered, they primarily serve as a justification for employing bypass tactics, particularly among left-leaning parties with a normative approach centered on democratic values. This emphasis on declining democracy is driven by Sweden's commitment to maintaining bilateral cooperation with state actors in countries with stable democracies, aligning with the principles of country ownership outlined in the Paris Declaration of Aid Effectiveness. Both the Swedish government and Sida are fully aware of the risks associated with aid capture, prompting them to employ bypass tactics and refrain from engaging in state-to-state cooperation in countries where democracy is deteriorating, and the risk of aid capture is perceived to be higher.