One result of Africa's marginalisation in the world economy is the peculiarly important role that aid plays in the continent. Whilst Africa's share of international trade is an almost insignificant three per cent, it accounts for more than thirty per cent of the global aid business (Sunday Nation,5 May 1996). Aid policy, itself, is dominated by what has been described as the New Policy Agenda of neo-liberalism and liberal democratic theory, which assigns NGOs a key role. This article examines how one influential donor in Kenya, USAID, has funded and promoted NGOs in the health sector, notably mission hospitals. The article questions claims for their comparative advantage, and illustrates the extent to which they have been integrated into a national health structure. It concludes by pointing out some of the long-term consequences of such a donor-sponsored 'NGO-isation' of different spheres of African society.