| Zimbabwe has been receiving official development assistance in both the pre and postindependence era.Zimbabwe got independent from British colonial rule in April 1980.The country has often turned to rely on foreign financial aid in periods of economic hardship.However,despite getting substantial amounts in development aid Zimbabwean policy makers have often been criticized for not focusing on self-reliance.Critics argue that the country has seem not progress much nor realize the desired economic growth levels leading to various locals calling for the implementation of local based solutions.Advocates for home grown solutions and self-reliance argue that Zimbabwe can achieve more growth even without getting foreign assistance.Various studies in literature have different conclusion on the effectiveness of ODA.They note that aid can attribute to negative,positive or insignificant effectiveness to economic growth.This research examined the specific question on whether ODA can improve economic or not.Aid effectiveness is the degree to which development aid enhances economic growth,and is a subject of substantial disagreement.The study applied VECM investigation method and covered the period 1975-2015 using time series data.Secondary data was used.In order to reveal that the current growth significance depends on both the present and past values of foreign aid the dependent variables including ODA were lagged once.This implies that the current figure and amount of foreign has an effect on both current and the future growth values.The findings from the study gave results which showed a long run causal relationship effecting GDP from ODA,domestic savings,political instability,government consumption expenditure and trade.ODA contribution to economic growth in the short run was found to be positive and statistically significant.It could be concluded that Zimbabwe should focus on consolidating ODA management and sustainability as well as enhance internal factors to induce economic growth. |
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