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Before I embark on the economic cooperation experience among the Islamic countries, members of the Organisation of Islamic Conference, I would like to dwell briefly on the history of OIC and its organisational set‐up.

Despite the apparent orientation of the world economy and markets towards globalisation, it is obvious that this process is dominated by trends of regionalisation and big economic blocs. Needless to say that this inclination towards groupings is dictated by the fierce competition at the world scale, economically and politically. Almost all of these economic blocs group countries with a lot of similarities in their socio‐economic and political structures as well as cultural set‐ups, geographical proximity and apparent vested mutual interests. An immediate question which comes to the mind when one thinks of the Islamic Common Market (ICM), where there is supposed to be free flow of products, capital, entrepreneurship, labour and technology among the members, as well as a common tariff wall against third parties, is whether the Islamic countries qualify for these criteria or not. The Islamic countries are known to be a diverse group in terms of their economic structures and levels of development, political systems, ethnic backgrounds, as well as a diversified social cultural milieu, although most of them draw on a common source, Islam. This heterogeneity has often been taken as the major argument against the feasibility of an ICM. However, we believe that although this heterogeneity creates a lot of problems, it is also a source of strength if it is positively thought of in terms of diversity and is carefully manipulated.

Although, in preparing this paper, the authors have had the chance to consult several reports and studies of the SESRTCIC that they had contributed to over the years, they would like to point out that the views expressed in this study are completely of their own and they cannot and should not in any way be attributed to the SESRTCIC or the OIC.

Introduction The term “Aid” refers to all forms of aid granting, whether loans or grants, from governments and multinational financing agencies. Private capital movements are excluded. I would also exclude emergency relief aid associated with natural calamities such as famines, floods etc., because of its temporary nature. In an ethical context, two major issues then arise. What are the possible ethical and/or non‐ethical considerations determining the flow of aid? Second, what is actually the status of aid granting in the world today? Can we, then, trace or develop a systematic moral case for aid granting? This would essentially entail an enquiry into the motives and effects of aid. Taking into consideration that economics deals, in the final analysis, with the real world and real human beings, it would be difficult to assume that human sentiments, greediness, self‐interest and global consciousness and responsibility are neutral elements in determining one's economic behavior. In this particular case, that is aid, it seems reasonable to talk of a number of considerations governing its motives. Put differently then, one needs to enquire the issue at two levels:

Despite the various modalities recommended to alleviate the debt burden, and the IMF‐World Bank led structural adjustment programmes, the African countries South of the Sahara (ACSS) are faced everyday with more and more complex problems. Their standards of living deteriorate systematically and they seem to be in an eternal state of debt overhang. The survey of the existing vast literature and empirical studies indicate clearly that most of the African countries cannot cope with the existing debt burden, unless a drastic breakthrough is brought about in their development process. At the same time, neither the volume of their national savings nor the mechanisms of mobilising internal resources, within the prevailing economic environment and the existing structural and institutional setups, are adequate enough to satisfy their ever‐increasing financing needs. Hence, a twin dilemma: mounting difficulties of repayment of existing stock of debts and a noticeable slowdown in external financial flows on the one hand, and insufficiency of the domestically generated funds, on the other bedevil the African development scenario.