ATIDI CEO Moses Manuel. Photo | courtesy.
ATIDI CEO says over reliance on foreign aid comes with demands from the donor and thus there is need to find solutions within our borders and ditch donor aid
In a world where international aid has been a lifeline for many African countries, Kenya’s growing reliance on donor funds has been a defining feature of its development landscape. But now, as global shifts in funding priorities loom large, a call is being made for greater investment in African institutions that can offer more sustainable, self-reliant solutions
The African Trade Insurance Agency (ATIDI), a Pan-African insurer based in Nairobi, is at the forefront of this movement, urging African governments to invest more heavily in local development institutions rather than depend on external donors, whose funding can fluctuate with global economic conditions and changing political priorities.
ATIDI’s CEO, Manuel Moses, is a vocal advocate for African solutions to African challenges, particularly in light of the U.S. government’s recent decision to reduce funding to the United States Agency for International Development (USAID), one of the largest sources of foreign aid for Kenya and many other African nations.
The Heavy Burden of Donor Aid
For decades, Kenya and Africa have relied on donor funds to help finance critical sectors such as health, education, and infrastructure. These funds have come from bilateral and multilateral organizations, with the U.S. government being one of the largest contributors.
In 2022 alone, the U.S. provided Kenya with over Sh77,490,000,000 ($600 million) in foreign assistance, which included contributions to food security, healthcare, and economic development programs. However, Kenya’s reliance on donor funding has often come with its own set of challenges.
While aid has helped meet immediate humanitarian needs, it has also meant that the country has had to work within the constraints of donor-driven agendas and timelines.
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As the global aid landscape shifts, Kenya now faces an uncertain future as funding from traditional sources becomes increasingly unpredictable. USAID, which has long played a key role in supporting Kenya’s development, recently announced significant cuts to its foreign aid budget, including reductions in direct-hire personnel.
By end of February 2025, many USAID staff members will be placed on administrative leave, and only mission-critical personnel will remain.
This change threatens to disrupt ongoing development projects in Kenya, including health programs like HIV/AIDS treatment and disaster relief efforts in response to the country’s frequent droughts. The cuts are not only a blow to humanitarian and development efforts in Kenya but also an indication of a broader trend that could be seen across the continent.
The U.S. decision reflects the growing volatility of donor funding, driven by political and financial factors outside the control of recipient countries.
ATIDI’s Call for Change
Amid these changes, ATIDI is calling for a shift in how Kenya—and Africa as a whole—approaches its development. “We can no longer afford to rely on foreign aid,” says Moses. “We must look inward and invest more in our institutions that are designed to address the unique challenges we face.”
ATIDI, which provides political and credit risk insurance to businesses operating in 24 African nations, believes that regional institutions can offer greater stability and flexibility in times of global uncertainty.
These institutions, tailored to the specific needs and realities of the continent, could be key in reducing Africa’s dependency on external financial assistance.
“The future stability of our economies depends on strengthening institutions like ATIDI, which are rooted in Africa and built to respond to the continent’s unique challenges,” Moses explains. “If we want to secure long-term growth and development, African countries must invest in African solutions.”
Moses’ call is timely, given the looming threat of a reduction in U.S. aid, and the broader global shift away from traditional donor-driven models.
While the need for aid is unlikely to disappear entirely, the ability of African nations to foster homegrown solutions could lay the foundation for a more resilient and self-sufficient continent.
Investing in Local Solutions
The question, then, becomes how Kenya can transition away from donor dependency and build stronger, locally-driven financial institutions. Moses points to ATIDI as a model, where local expertise and tailored financial products offer solutions that mitigate the political and economic risks that deter private investment in Africa.
“By investing in institutions like ATIDI, we can reduce the reliance on foreign sources of funding, while also encouraging more investment in Africa’s growing markets,” he says.
“Our continent has enormous potential, but we need to create the right conditions for growth by strengthening our own institutions.”
Kenya Taking Steps Tow
The government has been working to diversify its sources of financing, tapping into bonds, private investments, and initiatives like the Nairobi International Financial Centre, which aims to attract international capital. The success of such initiatives, however, depends on further empowering local financial institutions like ATIDI, which understand the African market and its risks better than any foreign donor agency could.
Kenya’s path to sustainable growth may not lie in ever-increasing amounts of foreign aid, but rather in its ability to build financial systems that can stand on their own, weather global storms, and ensure that funds are spent effectively within the context of the country’s priorities.
Changing Global Landscape
As Kenya and other African nations look to the future, it is clear that the world of foreign aid is transforming.
Donor funding, long seen as a pillar of development in Africa, is no longer as certain as it once was. The financial commitments of donor nations can be disrupted by shifting political landscapes, changing priorities, and economic challenges in donor countries themselves.
In light of these challenges, the future of African development may depend on the continent’s ability to rely more on its resources and institutions, while also building stronger regional partnerships.
The success of such efforts will determine whether Africa can move beyond donor dependency and establish a truly self-sustaining development model—one that empowers the continent to face its challenges on its terms.
As Manuel Moses of ATIDI aptly puts it, “It’s time for Africa to chart its own course, with our own solutions for our own problems.”
