What is an example and descrition of bilateral tied aid?

Bilateral tied aid refers to financial assistance provided by one country to another, contingent upon the recipient country using the funds to purchase goods or services from the donor country. For example, if Country A grants $10 million in aid to Country B specifically for the construction of infrastructure, but mandates that the contracts for materials and labor be awarded to companies from Country A, this constitutes tied aid. Such arrangements can benefit the donor's economy but may limit the recipient's options and potentially lead to higher costs.