ARTICLE AD BOX
In recent months, international aid has been subject to the "shock and awe" of dramatic cuts by the largest donor in the world, the United States, as well as many European countries.
But this reduction – recent projections suggest a $40 billion cut is expected in 2025 – is more than just a drop in funds. It increasingly looks like an assault on the norms and values – like solidarity and multilateral cooperation – that have been at the core of the Western liberal internationalist system since the Second World War.
This attack has not happened overnight. In fact, it’s been a long-time coming.
Criticisms of aid stretch back several decades and are not unique to the US. Free marketeers have long taken issue with a model of economic development reliant on benevolent state intervention, while those leaning to the left have expressed frustrations with the neocolonial aspirations of development that seeks influence over formerly dependent colonies.
The sector has trumpeted the effectiveness of aid to respond to criticisms that it doesn’t deliver results, but has not robustly moved forward the true devolution of power needed to achieve real impact. The aid sector has talked about global institutional reform but not addressed real imbalances of decision-making and representation between countries. This glacial pace of change has frustrated both aid providers and recipients alike.
Before Donald Trump's executive order suspending aid and dismantling the US Agency for International Development (USAID), aid cuts had already been announced in several countries including Germany, France and the Netherlands.
The UK has also recently cut its aid budget in order to grow its military spending. While global aid budgets grew to reach a notional peak of $223 billion (£166bn) in 2023, the amount of Official Development Assistance (ODA) spent beyond national borders has actually been falling in recent years, with more and more aid spent by major donors helping refugees inside their own countries, incentivising exports and external investment and reducing climate emissions.
The reality is that foreign aid hit both peak legitimacy and peak volume prior to this Trump-induced upheaval. And now the clock is ticking to define what this new 'post-aid' paradigm should look like.
In a series of meetings hosted by the think tank ODI Global, several government donors underwriting aid have been reflecting on how to manage short term political and fiscal pressures, while identifying a possible long-term vision for the next iteration of development cooperation and their role in it.
But beyond these immediate challenges, officials recognise an opportunity to exploit this moment of disruption to redesign a global development cooperation system fit for the realities of a multipolar world, as well as new development challenges – from increased humanitarian crises to climate change. Several voices from the Global South have also expressed considerable enthusiasm for a fundamental rethink, perhaps even more so than officials from donor countries horrified by the collateral damage of the sudden, sharp withdrawal of funding.
So what should come next?
Our discussions highlighted the need for a sound rationale for the modern-day purpose of public spending for development. Our research finds that narratives are most likely to succeed if they link to core national interests, cross-border challenges and international solidarity. New, compelling narratives for public spending on development can help taxpayers understand why such expenditure is important, which in turn can grow broader based political leadership that can champion such investment.
Our first meeting detailed three plausible policy rationales: narrowing the focus of aid on the most vulnerable in fragile and humanitarian contexts; inviting all countries, rich or poor, to collectively tackle shared global challenges; and transforming the structural drivers of inequality by changing policies on trade and debt that disadvantage the Global South.
To put these ideas into action we will need to change the way aid institutions function.
For example, Western NGOs working internationally will need to transition away from delivering bags of rice and tents and being contracted to provide services, towards building progressive movements and actively trying to influence the policies of their own governments.
Donor governments may spend less on big aid budgets, but focus more on other ways to create change, such as sharing intellectual property and changing their policies on migration or fossil fuel production.
It may be time to retire the traditional concept of rich countries giving money directly to poor countries altogether, in favour of pooling funding through institutions, like the United Nations, designed to address collective challenges – though such international institutions will need to be revitalised and streamlined.
In 1969, the Pearson Commission, named after Canadian Prime Minister Lester B. Pearson, was formed to recommend "a new basis for international cooperation" and ultimately led to an acceptance among donor countries to spend 0.7 per cent of their GDP on aid, creating the international aid architecture we know today.
We have reached a similar turning point and require similarly robust thinking about a new paradigm for international cooperation in the 21st century. A modern-day independent commission of high-level experts could help to think through the strategic and operational choices that need to urgently be made.
This is first of a series in partnership with ODI Global's Donors in a Post-Aid World
Heba Aly is the Facilitator of the Donors in a Post-Aid World dialogue series for the ODI Global think tank
Nilima Gulrajani is a Principal Research Fellow in the development and public finance team at the ODI Global think tank
This piece is part of The Independent’s Rethinking Global Aid series
English (US) ·