What Are the Different Types of State Financial Aid?

Financial assistance is also called official development assistance. A general term for various financial and material assistance provided by governments to other governments, directly or indirectly, using their budget budget funds. Financial assistance is conducted in the form of bilateral assistance or multilateral assistance, and is an international assistance of the nature of official economic assistance. Its main purpose is to support the economic development of the recipient country or help them solve their financial difficulties, and sometimes it is also an economic means to cooperate with diplomatic activities. There are two basic forms of financial assistance: free gifts and concessional loans. Among them, concessional loans include interest-free loans (no interest is calculated, only the principal is required to be repaid) and low-interest loans (in addition to the principal repayment, interest that is lower than the market interest rate is calculated). ^[1]

Financial aid

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Financial assistance is also called official development assistance. A general term for various financial and material assistance provided by governments to other governments, directly or indirectly, using their budget budget funds. Financial assistance is conducted in the form of bilateral assistance or multilateral assistance, and is an international assistance of the nature of official economic assistance. Its main purpose is to support the economic development of the recipient country or help them solve their financial difficulties, and sometimes it is also an economic means to cooperate with diplomatic activities. There are two basic forms of financial assistance: free gifts and concessional loans. Among them, concessional loans include interest-free loans (no interest is calculated, only the principal is required to be repaid) and low-interest loans (in addition to the principal repayment, interest that is lower than the market interest rate is calculated). ^[1]

The terms of these loans are relatively long, usually 10 to 50 years. When providing financial assistance, the donor country may provide free foreign exchange to the recipient country or provide various materials directly to the recipient country according to the agreement or conditions resulting from the negotiation between the two parties, and the recipient country may use its convertible currency or its own country as required. Product to return the loan. Generally, when providing financial assistance in the form of aid funds, multilateral aid methods are often used, and there are fewer restrictions on the types and regions of procurement materials. When bilateral aid methods are used, the aid country purchases the aided country. Most of them are accompanied by a certain degree of restrictive regulations, that is, the recipient country is required to purchase materials within the scope of the assisting country or certain countries (regions) designated by it, and sometimes there are restrictions or regulations on the types of materials purchased. ^[1]