Aid to poor countries fell, shows report

USAID-supported Mothers’ Associations speak out to keep girls in school Benin. (Credit: André Roussel/USAID)

By the amount spent, overall development assistance increased in 2014. But in real terms it fell by 0.5 percent and less of that money went to the world’s least-developed countries than the year prior, shows the data released by the Organisation for Economic Co-operation and Development (OECD) this week. With development assistance making up more than two-thirds of external finance for the world’s poorest countries, cuts by donors matter a lot.

“Alarm bells should be ringing at this shocking drop in aid going to those that need it most,” said Adrian Lovett, ONE Campaign’s Europe Executive Director, in a statement. “When G7 leaders gather in June in Bavaria and when the world’s finance ministers meet in Addis Ababa in July, they must commit to prioritise the poorest countries and the poorest people, particularly girls and women.”

The 28 countries and the EU that make up the OECD’s Development Assistance Committee (DAC) slightly upped their total development assistance from $135.1 billion in 2013 to $135.2 billion in 2014. When taking in things like inflation and currency changes, the value actually fell.

Credit: OECD

Credit: OECD

The news is being spun as good by some given the fact that leading economies are still financial under stress and have seen expenditures on foreign aid scrutinized. But looking a bit closer at the findings shows a less-than-promising story.

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The amount of bilateral aid (development assistance given by donors directly to recipient countries) for countries classified as least-developed came in at $25 billion, a decline of 16 percent in real terms. Part of the reason is a change of rules for determining official development assistance (ODA). After coming under criticism in recent years, DAC decided to more strictly define what counts as ODA.

So, the debt relief provided to Myanmar in 2013 counted towards ODA totals in that year, but would not have if it occurred in 2014. That alone accounts for half of the decrease, but there is still an 8% decline to least-developed countries that is concerning.

“ODA remains crucial for the poorest countries and we must reverse the trend of declining aid to the least-developed countries. OECD ministers recently committed to provide more development assistance to the countries most in need. Now we must make sure we deliver on that commitment,” said DAC Chair Erik Solheim, in a press release.

A further example is that 15 of the DAC members decreased their development assistance and 13 increased their total.

Both Australia and Canada were a part of the group that spent less, a reflection of the decision by both countries to shutter their aid agencies and place the work under the auspices of their foreign ministries. Economic woes hit foreign assistance budgets in Japan, Spain and Portugal.

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Oxfam’s Senior Policy Advisor Claire Godfrey called out the performance of a few countries, including the U.S.

“This picture would be a lot worse if it were not for the leadership of a handful of countries such as the UK and Denmark,  masking the poor performance of the majority.  Wealthy countries, such as France, the US and Australia, have failed to uphold their commitments to the world’s most vulnerable people,” she said.

LDCs

Five countries crossed the U.N. target of spending 0.7 percent of gross national income on development assistance – Denmark, Luxembourg, Norway, Sweden and the UK. Though they were handily beat by emerging donor and non-DAC member the United Arab Emirates. The country spent 1.17 percent of its GNI on foreign assistance in 2014.

The OECD sees itself as a place to encourage not only more development spending, but a better targeted distribution.

“Our challenge as we finalize post-2015 development goals this year this year will be to find ways to get more of this aid to the countries that need it most and to ensure we are getting as much as we can out of every dollar spent,” said OECD Secretary-General Angel Gurría in a statement.

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Tom Murphy

Tom Murphy is a New Hampshire-based reporter for Humanosphere. Before joining Humanosphere, Tom founded and edited the aid blog A View From the Cave. His work has appeared in Foreign Policy, the Huffington Post, the Guardian, GlobalPost and Christian Science Monitor. He tweets at @viewfromthecave. Contact him at tmurphy[at]humanosphere.org.