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Poorest countries continue to lose out as wealthy donors pocket their own aid, according to latest OECD data

Guest content
25 April 2024

New figures published today by the OECD show that despite a small increase in total aid spent in 2023, wealthy countries are still spending record amounts on hosting refugees in their own countries, and the poorest countries continue to lose out. Reported by Julia Ravenscroft and Matthew Simonds at Eurodad.

The figures, published by the Development Assistance Committee (OECD-DAC), reveals that even though levels of official development assistance (ODA, or aid) increased globally in 2023, totalling US$ 223.7 billion, only 37 billion reached the world’s Least Developed Countries (LDCs), meaning the target of 0.15-0.2 per cent GNI is no closer to being met. 

A substantial amount of ODA reported never even left wealthy nations, mostly because US$ 31 billion, or 13.8 per cent, was allocated to the cost of hosting refugees in the donor countries themselves. This is the second highest year on record, only behind 2022, and largely responsible for inflating aid figures.

For the second year in a row, Ukraine was the country that received the most aid in 2023. 

Total ODA was also just 0.37 per cent of GNI on average across the 31 countries that are members of the OECD DAC - at the same percentage as last year. This remains far below the 0.7 per cent ODA/GNI promise made in 1970.

Matthew Simonds, Senior Policy and Advocacy Officer at the European Network on Debt and Development (Eurodad) said: “Today’s data shows that even though wealthy countries reported spending more money on overseas aid, the devil is in the detail. A closer look reveals that yet again, geopolitical priorities and domestic budgets have taken precedence over the needs of the world’s poorest people. This is unacceptable. Furthermore, if you look at aid across the 21 EU Members of the DAC, aid fell by a shocking 7.7 per cent, with only a few members increasing their aid last year. 

“These trends reflect the tremendous changes to the aid landscape in recent years in which ODA has been instrumentalised and the rules have been ‘modernised’ to suit wealthy donors’ priorities, casting doubt on the integrity of aid in the 21st century.

“Furthermore, the commitments that these governments made more than 50 years ago to allocate 0.7 per cent of GNI to ODA continue to go unmet by most. The latest calculations reveal that the ongoing debt owed to global south countries is staggering, in the trillions. ”

Today 26 CSOs, including Eurodad, have signed a statement under the OECD DAC-CSO Reference Group banner. The statement outlines how ODA diversion remains a significant problem to be addressed  and calls for a needs-based and transparent aid allocation in line with the aid effectiveness principles. 

Major concerns for the future of aid include new rules that were agreed at the end of 2023, which mean donors can channel more funds to the private sector through so-called ‘private sector instruments’ (PSIs), which is funding used to make direct investments in private enterprises in low- and middle-income countries, or through development finance institutions and investment funds.  The full impact of these changes remains to be seen. 

Matthew Simonds added: "It is important to remember that aid is not charity. As public awareness of the lasting burdens of colonialism has grown, ODA should be a powerful signal of the global north taking responsibility for its past - and continuing - exploitation of countries of the global south. ODA remains a critical source of support for the poorest communities, and right now wealthy countries, and the governance structures that hold them to account, are failing to deliver what has been promised. 

“We urge donor governments to meet their commitments, both present and past, in order to deliver the Sustainable Development Goals (SDGs) and international climate commitments on which the future of the planet depends." 

Read the NGO statement by the DAC Civil Society Reference Group here

Original source: eurodad

Image credit: All rights reserved by gabramosp, flickr creative commons