Well, because it is threatening to foreign governments.
In recent decades, government sponsored nongovernment organizations (NGOs) have played a big role in trying to promote democracy across the world, from the former states of the Soviet Union to the Balkans, through the Middle East, and on to Indonesia and other parts of Asia.
And not surprisingly, they've also attracted the attention and fear of governments that see them as fifth-columns who exist to undermine their leaders and practices. Much of this verges on conspiracy theory, with claims that the role of such groups is to specifically destroy existing governments (the pro-democracy NGOs financed by billionaire George Soros are particular targets for this kind of complaint).
Well, various governments without exactly sterling human rights and democracy records have been pushing back hard against NGOS, drawing outrage from democracy advocates and governments such as the US.
Russia passed a law last year requiring NGOs that receive foreign money to either register as "foreign agents" or give up the cash, and has been vigorously enforcing it of late. More than 500 nongovernment organizations, who do election monitoring, human rights work, and run anticorruption efforts, are under investigation as deserving of the label.
In Turkmenistan, President Gurbanguly Berdymukhamedov decreed that a state commission be created to supervise all foreign funded projects and Eurasianet claims that "if implemented in its entirety, the decree would enable the government effectively to take financial control of all forms of nonprofit activities in the Central Asian state."
Egypt, just two years after its uprising against Hosni Mubarak and now ruled by the Muslim Brotherhood President Mohamed Morsi, is also getting in on the act. A new draft NGO law is drawing fury from human rights workers and political activists. Heba Morayef, the Egypt director for Human Rights Watch, writes on Twitter today that it looks "like latest draft of NGO law bans all foreign governmental & inter-governmental funding of NGOs. Bye bye UN, EU, USAID, DFID funding."
President Morsi announced today that he had referred the law to the Shura Council, Egypt’s nominal upper house of parliament. While the lower house remains dissolved, the Council has the authority to pass new legislation until elections are held to elect a lower house.
“If they pass the law in its current form, the Egyptian authorities would send a message that little has changed since the Mubarak era, when the authorities restricted independent human rights organizations to stop them from exposing abuses,” said Hassiba Hadj Sahraoui, Deputy Middle East and North Africa Programme Director at Amnesty International. “Passing a law such as this one in a country with a long history of cracking down on the work of human rights organizations would be incredibly dangerous. If Egypt is serious about moving forward from its recent past, the authorities must turn away from this law and instead enable an environment for NGOs to ensure human rights are protected and promoted.”
Since the fall of Mubarak, Egypt has been incredibly wary of foreign NGOs – a group of NGO workers are currently on trial for receiving foreign funding, one of them an American.
But it's not hard to understand why governments don't like NGOs getting hard-to-control foreign funding (in poorer countries there isn't much money available for such groups and the locally wealthy who might help them out can be easily leaned on by the state). More openness and transparency are, after all, threats to many of these regimes – as are flourishing democracies.