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Budget pressures affect aid

Aid from major donors in the OECD area to developing countries fell by nearly 3% in 2011, ending a long trend of annual increases: until 2011, aid had been increasing for more than a decade, and by 63% between 2000 and 2010, the year it reached its peak.

Dips in bilateral, multilateral and humanitarian aid, as well as debt forgiveness, all contributed (our chart). Moreover, tight budgets in OECD countries look set to put aid under more pressure in the years ahead. 

In 2011, the countries that form the Development Assistance Committee (DAC) at the OECD (see link below) provided US$133.5 billion of net official development assistance (ODA), representing 0.31% of their combined gross national income (GNI). This was a drop of 2.7% in real terms compared to 2010. Within that total net figure, aid for core bilateral projects and programmes (i.e. excluding debt relief grants and humanitarian aid) fell by 4.5% in real terms.

Bilateral aid to sub-Saharan Africa was $28 billion, a slide of 0.9% in real terms compared to 2010. But aid to the African continent as a whole rose by the same rate, to reach $31.4 billion, reflecting assistance to North Africa after the revolutions in the region. The group of Least Developed Countries (LDCs) saw a sharp fall of 8.9% in their net bilateral ODA flows, to $27.7 billion.

The largest donors were the US, Germany, the UK, France and Japan, while the largest real rises in ODA were from Italy, New Zealand, Sweden and Switzerland. But official development assistance fell in 16 DAC countries, notably in Austria, Belgium, Greece, Japan and Spain.

See www.oecd.org/dac

©OECD Observer No 290-291, Q1-Q2 2012