Foreign aid is the transfer of resources in concessional terms that are usually taken by the government officials with the aim of promotion of economic development and welfare (Ehrenfeld Daniel, February 1, 2004). Peace and war has the significant effect of distribution of foreign aid in the developing countries and distribution of foreign aids is effected in several factors which are based on the relations amongst the countries, military power, strategic natural resources, chances of development, diplomat ties and prestige, etc. Several positive effects of foreign aids to the developing country are:
For example, Tanzania has been the relative success story in terms of political reforms of Africa (Chatrrna Dasha, et al, n.d.). The country has been the second largest recipient after Ethiopia which has helped in strengthening the civil society, parties, legislature and judiciary.
Some of the negative impacts are as follows (Chheang Vanarith, April 8, 2009):