Academic Papers

Critical Analysis of Neoliberal NGOs Role and Relationships in ‘Developing’ Countries

Shareefa Panchbhaya

Since the 1980s, NGOs have played a crucial role in developing countries, but their role and relationships with the state have been heavily criticised by those who argue NGOs act as Trojan horses by actively supporting neoliberalism. Yet, NGOs in developing countries are considered to be a positive force by those in the international community who donate to charities. NGOs may make a positive difference, but the opposite can be the case, especially when NGOs are not local community-lead organisations. Developing countries are perceived by many in the Global North as being incapable, corrupt and inefficient, a view which perpetuates images of people in these countries as uncivilised and in need of European help to save them from man-made poverty or occupation. This essay will examine the failure of NGOs to challenge the exploitation of the resources of developing countries. The accountability of NGOs in developing countries to their beneficiaries will be analysed, focusing on the problematic relationship between Southern NGOs as clients who depend on Northern donors and governments. Indigenous resistance movements in the Global South raise demands from NGOs after monitoring them to ensure their own land and people are not mere tools for neoliberal thinkers. This will form part of the following critique of the role of NGOs in developing countries.

Philanthropy has been a force legitimising support from Western countries to developing countries by providing NGOs to work within Global South communities. Philanthropists can be considered to carry out the same work as imperialists by extending the hegemony of the United States the way native elites served colonialism. (See Roy, 2012) The role and relationships of NGOs in developing countries have to be analysed through a critical prism to recognise the exploitation of the global south by corporations which fund the existence of NGOs, negatively impacting local communities. NGOs form a hierarchy in developing countries as they may be less effective relative to the work being undergone by indigenous communities.  By the 1950s, the Rockefeller and Ford foundations were funding several NGOs and international educational institutions which began their work as quasi-extensions of the US government, which was itself at the time toppling democratically elected governments in Latin America, Iran and Indonesia. (Roy, 2012) With institutions working against the agenda of global south anti-imperialist developing countries, the legitimacy of NGOs, which purposefully exist to champion neoliberalism in the region, cannot go unnoticed.

 When the IMF enforced Structural Adjustment and arm-twisted governments into making cuts on public spending on health, education, childcare, and development, NGOs took over by privatizing everything. People became dependent on NGOs for employment as jobs and livelihoods disappeared; ultimately, even those well aware of the agenda and motive of some NGOs were affected. Corporate or Foundation-endowed NGOs are global finance’s way of buying into resistance movements to control them from within. They do this by making the organisations sign a pledge, like shareholders buying into companies. The greater the number of NGOs, the more people carry out surveillance monitoring, feeding back on the work of the community. The funders usually work to smear the names of resistance movements and the people who lead them, as they did with Narmada Bachao Andolan and the protest against the Koodankulam nuclear reactor in India when they accused these movements of receiving ‘foreign funding’. These NGOs, armed with billions of dollars, turned potential revolutionaries into activists receiving a salary, funding artists, intellectuals and filmmakers by distancing them from any form of radical confrontation of the inequality within the system. They are forced to embrace multi-culturalism, gender and community development, where revolutionary ideals are diluted by encouragement to focus on identity politics and human rights. (Roy, 2012)

NGOs operate as Trojan horses for neoliberalism, where they view those who express their rights as lacking the financial resources to be able to formulate their own advocacy groups. NGOs have intervened in social provision when the state has withdrawn from supporting advocacy groups, a process leading to the privatization of NGOs. NGOs are not democratic institutions but tend to be elitist, accountable only to their donors and are not close to marginalised indigenous people whom they claim to be supporting. This makes it difficult to identify where support is most needed.

NGOs conceal their agendas whilst preferring to negotiate or wield influence over state and class power, whilst controlling their beneficiaries rather than representing them or allowing them to speak for themselves. The legitimacy of NGOs needs to be challenged alongside a close examination of their role in the developing country. For instance, attempting to rule out child labour and child prostitution can undermine economies where that labour is fundamental. NGOs, therefore, can prevent the development of the developing country by intervening to legitimise and delegitimise the cycle performance of the state by saying what is and isn’t feasible. Ultimately this can cripple state progress whilst they are bound to ensure debts owed to the World Bank and the IMF must be paid for. (Harvey, 2005:177)

In the Post-Cold War era, aid budgets declined with funds being channelled to governments, but now these monies are channelled to NGOs. USAid and the European Union were channelling aid to International NGOs, which led to the proliferation of Southern NGOs. Southern NGOs are being made to become dependent on Northern donors who fund them to keep them existing in an imbalanced partnership: the donor holds precedence in deciding what the aid should be used for, making Southern NGOs work as subcontractors where their work focus revolves around the priorities set by the Northern donors.

A clear hierarchy is enforced between the relationship of the state funding the NGO and its relationship with the developing country involved. Donors require accountability from the NGO where they set the NGO targets to be met in order to continue receiving funding. This pressurises the indigenous community to work in order to meet these targets rather than focus on providing an efficient support network to their community. They are pressured to work bureaucratically to ensure their targets are met for the NGO to receive their next round of funding and pay their own wages. The accountability held over NGOs requires governance reports and accounts, but this largely bureaucratic process is not efficient in supporting communities’ right to self-determination or to begin to build within their own communities without dependency on Northern donors. In Rajasthan, India experienced indigenous fieldworkers feeling demoralised, considering NGOs were heavily staffed with privileged local people who could speak English and were computer literature graduates. Large groups within the nations, especially the most underprivileged, do not always benefit from NGO education programmes, which only serve to marginalise them further. If you live in an unequal society, this is made harder when you are competing against someone who has mastered the colonial language of English.

Regardless of the fact that governments may welcome the growth and expansion of NGOs, the tension between the state and the NGO arises where faith-based NGOs generate controversy. An example of this occurred with the Lutheran World Federation funding RDRS in Bangladesh and Australian missionaries in Orissa. When Western NGOs work with women, the advocacy work can be perceived as threatening towards indigenous men: ‘White man saving brown women from brown men.’ The community is monitored by NGOs, ensuring no political activity is occurring in the region; otherwise, this may upset the state providing the NGO with the donor. Amnesty International, Human Rights Watch and various Western feminist organisations criticising the lack of freedom for women in Afghanistan were responsible for backing the military occupation of Afghanistan by the United States and Britain. Viewing Afghan women’s liberation through the prism of the Eurocentric orientalist viewpoint was damaging in the decisions made regarding Afghanistan as a democracy. Did Afghan women need ‘saving’ by Western states funding NGOs in Afghanistan? Three years into the military occupation, 2,500 international NGOs operated in Afghanistan. In April 2009, Richard Holbrooke, the United States special representative for Afghanistan and Pakistan, stated that most information they had gathered about Afghanistan and Pakistan came from aid organisations in the region. (Engler,  2010)

NGOs act as vehicles for tax evasion in developing countries whilst being closely monitored by governments. In India, Bangladesh and Kenya, NGOs must register with the government, which can then monitor the work of the NGO. NGOs must abide by regulations where donors request that indigenous people’s political activity and empowerment programmes are limited. NGOs lure hardworking community activists who are genuinely interested in witnessing their country’s development and their people’s freedom. They are offered financial gain and engaged in bureaucracy rather than involved in independent, autonomous movements.  NGOs in Sierra Leone, for example, working with children affected by the civil war and living in poverty, will fail to be involved in challenging the exploitation of their mines by Western mining companies who have also funded the existence of these NGOs. The NGO pays NGO indigenous community workers to deter them from resisting or getting involved in an armed struggle for liberation or joining forces with anti-neoliberal activists who want to witness revolutionary change within their community.

NGOs have a small-scale impact on developing countries’ development because they lack accountability and a low level of professionalism.  They also lack legitimacy from a democratic government and are not being elected by the people, and are not accountable to them either. NGOs are accountable to global North donors, which is contradictory when priorities are not part of a two-way dialogue but imposed on them: Western-funded NGOs decide on the needs of the clientele as they see best. Cases of NGOs being held accountable by beneficiaries are rare, such as a child’s school education fees not being paid on time. The neoliberal claim is that NGOs serve the poor better, but indigenous people should have the right to self-determination to resolve their own community issues by redistributing wealth rather than accepting handouts from northern NGO donors.

Other criticisms are that NGOs in developing countries are often duplicated without consulting the state, which can create division amongst communities rather than building and extending to what is already available, especially when NGOs compete. Bangladesh has a severe case of 1,000 NGOs running micro-credit schemes, resulting in a lack of coordination and cooperation between NGOs competing for funding. and fail to work together. Another fault is that NGOs operate on a contract basis, with funding lasting for a set period of time and then stopping. This is ineffective as the NGOs work comes to a halt when the funding is finished or withdrawn. This lack of continuity keeps the NGO from accomplishing its long-term plans with beneficiaries and also means the clientele is always left unsure of how long they will continue to receive funding and support from the NGO funders.

NGOs fail to challenge the corporations who exploit the natural resources of developing countries, whilst Western states are responsible for evading billions every year in tax dollars. Neither do NGOs support the developing countries to resist large amounts of their mineral resources from being exploited, with the donors being responsible for supporting corruption, food subsidies and trade restrictions? The role of NGOs in developing countries holds no accountability, which is damaging, especially when Western states are occupying those countries. The existence of NGOs also depends on the underdevelopment of global South countries in order to continue to exist.

In occupied Palestine, state-funded NGOs have taken over the city of Ramallah. This legitimises the occupation, whilst NGOs actually need the occupation to continue in order to survive.  Israel will allow NGOs to be based in the West Bank in order to support the peace process. This results in indigenous Palestinians not being involved in resisting the occupation. Revolutionaries would have to force NGOs to leave by armed struggle, seeing as the state is more concerned with its security. NGOs accept aid from the international community, which indigenous activists speak out against receiving, considering these handouts as only further supporting Israel’s colonisation plans. (Hijab, 2012)

There are some examples of organisations refusing to accept the power of unaccountable NGOs. The Zapatista’s indigenous autonomy movement in Chiapas, Mexico, refused government aid in order to have a long-term self-autonomy movement and to develop their own country. They had several discussions with NGOs to ensure they maintained control of the NGOs rather than the Western NGOs determining what is needed in Chiapas. The Zapatistas were aware that the role of NGOs and international organisations consisted of making decisions on the needs of a foreign community without consulting the community itself, imposing projects and the length of time for those projects to be sustained. If the community does not have the right to demand their needs, it would be unfair for a community in need of clean water to be given a school, say, when the priorities of that indigenous community lay elsewhere. The Zapatistas worked heavily on community empowerment when establishing community projects to counterbalance uneven development that NGO funders dictated, with the Juntas often charging a 10 per cent tax for the region. (Stahler-Sholk, 2011:57) The Zapatistas believe in communities being self-sufficient in reference to larger networks of fair trade and solidarity. The Zapatistas were able to hold each other to account and the communities they represented through grassroots representation.  Many NGOs consider themselves to be agents for change rather than facilitators of grassroots agency. NGOs taking the position of aligning themselves with the elite only lose connection to the grassroots, which is where the right to self-determination develops. (Pearce, 2010:632)

In conclusion, this essay has shown ways in which the NGOs in developing countries have been manipulated in order to align with neoliberal agendas to maintain control of the development and economic growth of global south communities. The generosity and growth behind donors’ giving is fuelled by the aid donors’ perception of failed states. Humanism is promoted when NGOs seek involvement in countries and continents, but this neglects the faults of neoliberalism being thoroughly assessed. NGOs work independently of the developing countries’ governments, which is a huge criticism in itself. Global North communities determine the needs of those living poverty-stricken lives, completely opposing the right for self-determination for the indigenous people. NGOs are not being held accountable by beneficiaries, demonstrating the poor relationship between the NGO and the state. The role of state-funded NGOs in developing countries is determined by foreign policy and the West’s neoliberal interests in supporting the ‘development’ of a country by setting up NGO’s everywhere they can. NGOs become part of the state’s infrastructure which interrupts effective methods of engagement:  people need to take control of their own community’s development and growth by encouraging communities to be self-determined, independent and autonomous.


Engler, Y. (2010). The Humanitarian Invasion of Afghanistan: Occupation by NGO. Available: http://www.globalresearch.ca/the-humanitarian-invasion-of-afghanistan-occupation-by-ngo/20919. Last accessed 5th Jan 2013.

Harvey, D (2005). A Brief History of Neoliberalism. New York: Oxford. p177.

Hijab, N. (2012). Rethinking Aid To Palestine. Available: http://mideast.foreignpolicy.com/posts/2012/08/03/rethinking_aid_to_palestine. Last accessed 5th Jan 2013.

Pearce, J. (2010). Is social change fundable? NGOs and theories and practices of social change. D. 20 (6), p632.

Roy, A. (2012). Capitalism: A Ghost Story. Available: http://m.outlookindia.com/story.aspx?sid=4&aid=280234. Last accessed 30th Dec 2012.

Stahler-Sholk, R. (2007). Resisting Neoliberal Homogenization: The Zapatista Autonomy Movement. Latin American Perspectives, Globalizing Resistance: The New Politics of Social Movements in Latin America . 34 (2), pp. 48-63.

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