An Era of "Aidlessness" Impending?
DEVELOPMENT ASSISTANCE CHALLENGES AND PROSPECTS
A matter-of-fact introductory passage is in order, I suppose. Official development assistance (ODA) has been the principal instrument of concessional external support for “third world” countries (now generally referred to as the Global South) in the post-Second World War period, with the aim of promoting their social and economic progress. Historically, such assistance has been provided mainly by industrialised countries and multilateral institutions. Although conventional definitions could use more and more subtleties as time goes by, they remain broadly accurate.
The institutional structures, rules and main priorities of ODA have evolved over decades, and sometimes the system is referred to, not without reason, as the “foreign aid industry”. Meanwhile, the 2020s have seen mounting negative trends to the point where some professionals are announcing the beginning of ODA’s “decline”. What has happened, then?
First, there are accumulated issues in provider countries’ policies. The goals of development assistance framework, even when set in terms of universal human values, have never been entirely divorced from pragmatism. Eradicating poverty and underdevelopment on the world’s periphery was, therefore, also intended to preserve the standard of living achieved in the Global North. More specifically, the aim was to contain major threats such as instability, pandemics, waves of migration, international crime and the like.
For all the lofty declarations made from the rostrum, only a small share of ODA has been genuinely philanthropic, primarily in the form of emergency humanitarian aid. In most cases, provider countries have acted with their own trade and economic interests in mind. A recent study of the German banking sector confirmed that every euro invested in foreign assistance generates €2.50 in export revenue.
In recent years, however, against a backdrop of geopolitical upheaval and fragmentation in the global economy (with an increasingly pronounced friend-or-foe division) development issues have slipped down the list of priorities in post-industrial societies. The conflicts between Russia and Ukraine and in the Middle East, coupled with turmoil in energy markets, have radically reshuffled the global deck. Security in its various forms has become a major driver of rising military expenditure, and sacrifices have had to be made elsewhere.
At the same time, major shifts are taking place in the political life of wealthy countries. The retreat of neoliberalism and the rise of conservatism and populism have already contributed to Donald Trump’s return to power in the United States, electoral gains by right-wing forces in Europe and Japan, and so on. Even the term “sustainable development”, sacred until recently, has been rejected by the current administration in Washington. In the US, as well as in the UK, Australia and Canada, development assistance agencies are being absorbed into foreign ministries or brought under their control more directly.
Second, ODA practices and the international architecture underpinning them have accumulated elements of stagnation and inefficiency. The much-publicised drive towards “localisation”, i.e. shifting the centre of gravity towards local civil society actors and government-aligned partners, is encountering serious obstacles. Yet this is arguably the area with the greatest promise. As Zambian President Hakainde Hichilema has put it, the decline in external assistance represents “a challenge—and an opportunity—for African countries to build stronger and more independent economies”. There is no denying the point, but both time and resources are needed and, at present, they are in short supply.
Meanwhile, external funding is spread too thinly across too many areas, partly because large international NGOs advocate for a broad range of causes while looking after their own interests, too, as usual. The UN Sustainable Development Goals (SDGs) which include 17 goals broken down into 169 targets are increasingly criticised precisely for their all-encompassing scope.
In short, development assistance is declining dramatically. According to the Organisation for Economic Co-operation and Development (OECD), the principal body monitoring this area, ODA fell by more than 23% in 2025 compared with the previous year, a drop of over $50 billion relative to 2023. As in most such cases, the poorest countries are bearing the brunt of the cuts. Their room for manoeuvre is extremely limited because of substantial external debt and recent economic shocks. (Debt deserves a separate discussion, but consider one concrete example: in Kenya, a 1% increase in debt-servicing payments is associated with a 1.2% decline in healthcare expenditure.)
For many Western policymakers, the very concept of ODA has become unfashionable. On September 14th, the United Kingdom’s new Development Minister, Kirsty McNeill, declared that the concept of “development” was outdated and that aid should instead be guided by the principle of “mutual interests”. Preferring her title to be “Minister for Security through Solidarity”, she outlined her remit as encompassing health security, climate security, economic security, human security and food security.
A favourite tactic among politicians of this kind is to argue that declining government funding should be offset by an influx of private investment from abroad. In reality, however, such hopes are fulfilled only to a very limited extent. Discussions on the sidelines of the October 2025 Annual Meetings of the Boards of Governors of the World Bank and the IMF concluded that expectations of attracting trillions of dollars from private investors were misplaced. Raising private capital will be impossible without addressing structural and regulatory issues in recipient countries, and “private finance does not—and perhaps should not—flow to some sectors”. As a result, estimates put the annual funding gap for achieving the UN SDGs at $4 trillion.
What, then, are the current trends in the major countries of the Global North?
In the United States, the Trump administration moved against foreign aid almost immediately after returning to the White House, arguing that it was focused on liberal globalism, including support for human rights. USAID, the largest US aid agency, was soon shut down, triggering a sweeping, and in many respects chaotic, reorganisation of the sector. Total ODA fell to an annual level of $28.95 billion.
At the UN, the United States put forward the “Trade Over Aid” initiative, which focuses on promoting market-based approaches in the developing world, primarily through deregulation and the protection of investors’ rights. In essence, the approach adopted by the current president and his team is transactional, or, more bluntly, deal-driven. The emphasis is on “you scratch my back, I’ll scratch yours”, ensuring incentives for American businesses and protection against commercial and energy-related shocks.
It would nevertheless be an exaggeration to claim that Washington has turned its back on ODA altogether. The view of foreign assistance as an instrument of “soft power” has not been abandoned. Funding is being allocated far more sparingly and selectively, but the tap is still turned on. Among other things, US money continues to flow into UN emergency humanitarian operations. In December 2025, an initial $2 billion was allocated, although it is more than eight times less than in 2022. In return, however, the administration removed Afghanistan, Yemen, the Gaza Strip and climate-related programmes from the list of funding priorities. The UN had little choice but to accept this.
At the same time, the United States has signalled its willingness to commit substantial funding to areas such as healthcare, provided that recipient governments are themselves capable of making major financial contributions to the projects. This is currently the basis of discussions with Malawi, although observers are sceptical about whether the African country can shoulder the proposed partnership.
The European Union and its member states are following a similar course. The EU cut ODA by 13.8% in 2025, while individual member states reduced their contributions by an average of 10%. This represents the largest annual decline in the history of the EU, and the consequences for numerous programmes are clearly severe. In particular, the goal of ending AIDS as a public health threat by 2030 (one of the SDG objectives) appears increasingly unattainable, especially in sub-Saharan Africa.
Many European leaders have stressed that the retreat from development assistance is a painful step taken amid growing international tensions and rising defence expenditure. This is only partly true, however. The latest measures fit into an established policy of subordinating ODA to broader strategic objectives (in other words, “geopoliticising” aid, as one apt definition has it). Since the continent-wide migration crisis of 2015, European countries have linked assistance to recipient countries’ cooperation in curbing outward migration. The EU now also counts certain expenditure on managing immigration within its own borders as ODA.
Germany, despite having substantially scaled back its foreign assistance, remained the largest OECD donor on paper, with $29 billion in 2025. Yet the downward trend continues: the draft budget for the following year envisages a further 6% reduction in funding. France, amid mounting economic difficulties, has been cutting its development contributions for six consecutive years. The draft budget for 2027, unveiled recently, merely confirms the trend, with a 43% reduction (€1.9 billion). In the United Kingdom, the days when ODA amounted to 0.7% of GDP are now a distant memory; today the figure has fallen to a modest 0.3%. Japan has not slashed its funding as sharply, but the trend is still downward: $15.6 billion this year, compared with $16.5 billion last year.
China’s approach to ODA cannot be explored in any detail in this overview. Broadly speaking, the West’s partial retreat gives Beijing an opportunity to further consolidate its recently acquired image as the leading global champion of sustainable development. Yet the distinctly pragmatic underpinnings of this leadership cannot be ignored. China’s actions also reveal a clear logic of quid pro quo: infrastructure construction in exchange for access to natural resources, and security assistance designed to foster closer political ties with Beijing.
To sum up, the severe crisis of ODA should not be dismissed as a fit of selfishness on the part of the Global North (where major private donors, such as foundations etc., are still around) or as a reflection of the questionable effectiveness of multilateral organisations such as the UN, the World Bank, the IMF, and regional development banks. The conventional model of development assistance is genuinely running out of steam and needs to be reinvented. Above all, this means reconsidering the frame of the moral responsibility of developed countries towards those lagging behind coupled with the obligation of recipient countries to secure their own growth.
Equally important is the need to reach a consensus on how development and security should be linked in the modern world. The June issue of the American magazine Foreign Affairs featured a manifesto-like article entitled “The End of Foreign Aid Is Not the End of Development”. The formulation may be simplistic, but the slogan carries considerable weight.
All in all, sensational headlines aside, the overall picture is by no means entirely bleak. External assistance, combined with the efforts of Global South countries in pursuit of the UN SDGs, is delivering results. In 2000, 2.2 billion people worldwide lived on an income equivalent to $3 a day; today, that figure has fallen to 840 million. Between 2000 and 2024, life expectancy in low- and middle-income countries increased by six years. And the list of achievements does not end there.
There is no doubt that, sooner or later, Moscow will need to engage more deeply and substantively with development assistance in the Global South, moving beyond the realm of sound rhetoric, as exemplified by the Russia–Africa Forum. This will require a serious examination of foreign aid issues, some of which have been outlined above.
Alexander Gorelik, expert on international organisations
Иллюстрация: «За рубежом», Leonardo.ai
The institutional structures, rules and main priorities of ODA have evolved over decades, and sometimes the system is referred to, not without reason, as the “foreign aid industry”. Meanwhile, the 2020s have seen mounting negative trends to the point where some professionals are announcing the beginning of ODA’s “decline”. What has happened, then?
First, there are accumulated issues in provider countries’ policies. The goals of development assistance framework, even when set in terms of universal human values, have never been entirely divorced from pragmatism. Eradicating poverty and underdevelopment on the world’s periphery was, therefore, also intended to preserve the standard of living achieved in the Global North. More specifically, the aim was to contain major threats such as instability, pandemics, waves of migration, international crime and the like.
For all the lofty declarations made from the rostrum, only a small share of ODA has been genuinely philanthropic, primarily in the form of emergency humanitarian aid. In most cases, provider countries have acted with their own trade and economic interests in mind. A recent study of the German banking sector confirmed that every euro invested in foreign assistance generates €2.50 in export revenue.
In recent years, however, against a backdrop of geopolitical upheaval and fragmentation in the global economy (with an increasingly pronounced friend-or-foe division) development issues have slipped down the list of priorities in post-industrial societies. The conflicts between Russia and Ukraine and in the Middle East, coupled with turmoil in energy markets, have radically reshuffled the global deck. Security in its various forms has become a major driver of rising military expenditure, and sacrifices have had to be made elsewhere.
At the same time, major shifts are taking place in the political life of wealthy countries. The retreat of neoliberalism and the rise of conservatism and populism have already contributed to Donald Trump’s return to power in the United States, electoral gains by right-wing forces in Europe and Japan, and so on. Even the term “sustainable development”, sacred until recently, has been rejected by the current administration in Washington. In the US, as well as in the UK, Australia and Canada, development assistance agencies are being absorbed into foreign ministries or brought under their control more directly.
Second, ODA practices and the international architecture underpinning them have accumulated elements of stagnation and inefficiency. The much-publicised drive towards “localisation”, i.e. shifting the centre of gravity towards local civil society actors and government-aligned partners, is encountering serious obstacles. Yet this is arguably the area with the greatest promise. As Zambian President Hakainde Hichilema has put it, the decline in external assistance represents “a challenge—and an opportunity—for African countries to build stronger and more independent economies”. There is no denying the point, but both time and resources are needed and, at present, they are in short supply.
Meanwhile, external funding is spread too thinly across too many areas, partly because large international NGOs advocate for a broad range of causes while looking after their own interests, too, as usual. The UN Sustainable Development Goals (SDGs) which include 17 goals broken down into 169 targets are increasingly criticised precisely for their all-encompassing scope.
The UN development system as a whole — a constellation of agencies and funds addressing economic inequality, healthcare, education and the circumstances of vulnerable groups — is in a tough spot. The main issue is that the world’s principal global organisation is facing the financial, and even existential, crisis. In addition, aid structures at both the regional level (the EU) and the national level (more than two dozen US agencies are involved in aid-related activities) are prone to bureaucratic inertia.
In short, development assistance is declining dramatically. According to the Organisation for Economic Co-operation and Development (OECD), the principal body monitoring this area, ODA fell by more than 23% in 2025 compared with the previous year, a drop of over $50 billion relative to 2023. As in most such cases, the poorest countries are bearing the brunt of the cuts. Their room for manoeuvre is extremely limited because of substantial external debt and recent economic shocks. (Debt deserves a separate discussion, but consider one concrete example: in Kenya, a 1% increase in debt-servicing payments is associated with a 1.2% decline in healthcare expenditure.)
For many Western policymakers, the very concept of ODA has become unfashionable. On September 14th, the United Kingdom’s new Development Minister, Kirsty McNeill, declared that the concept of “development” was outdated and that aid should instead be guided by the principle of “mutual interests”. Preferring her title to be “Minister for Security through Solidarity”, she outlined her remit as encompassing health security, climate security, economic security, human security and food security.
A favourite tactic among politicians of this kind is to argue that declining government funding should be offset by an influx of private investment from abroad. In reality, however, such hopes are fulfilled only to a very limited extent. Discussions on the sidelines of the October 2025 Annual Meetings of the Boards of Governors of the World Bank and the IMF concluded that expectations of attracting trillions of dollars from private investors were misplaced. Raising private capital will be impossible without addressing structural and regulatory issues in recipient countries, and “private finance does not—and perhaps should not—flow to some sectors”. As a result, estimates put the annual funding gap for achieving the UN SDGs at $4 trillion.
What, then, are the current trends in the major countries of the Global North?
In the United States, the Trump administration moved against foreign aid almost immediately after returning to the White House, arguing that it was focused on liberal globalism, including support for human rights. USAID, the largest US aid agency, was soon shut down, triggering a sweeping, and in many respects chaotic, reorganisation of the sector. Total ODA fell to an annual level of $28.95 billion.
At the UN, the United States put forward the “Trade Over Aid” initiative, which focuses on promoting market-based approaches in the developing world, primarily through deregulation and the protection of investors’ rights. In essence, the approach adopted by the current president and his team is transactional, or, more bluntly, deal-driven. The emphasis is on “you scratch my back, I’ll scratch yours”, ensuring incentives for American businesses and protection against commercial and energy-related shocks.
It would nevertheless be an exaggeration to claim that Washington has turned its back on ODA altogether. The view of foreign assistance as an instrument of “soft power” has not been abandoned. Funding is being allocated far more sparingly and selectively, but the tap is still turned on. Among other things, US money continues to flow into UN emergency humanitarian operations. In December 2025, an initial $2 billion was allocated, although it is more than eight times less than in 2022. In return, however, the administration removed Afghanistan, Yemen, the Gaza Strip and climate-related programmes from the list of funding priorities. The UN had little choice but to accept this.
At the same time, the United States has signalled its willingness to commit substantial funding to areas such as healthcare, provided that recipient governments are themselves capable of making major financial contributions to the projects. This is currently the basis of discussions with Malawi, although observers are sceptical about whether the African country can shoulder the proposed partnership.
The European Union and its member states are following a similar course. The EU cut ODA by 13.8% in 2025, while individual member states reduced their contributions by an average of 10%. This represents the largest annual decline in the history of the EU, and the consequences for numerous programmes are clearly severe. In particular, the goal of ending AIDS as a public health threat by 2030 (one of the SDG objectives) appears increasingly unattainable, especially in sub-Saharan Africa.
Many European leaders have stressed that the retreat from development assistance is a painful step taken amid growing international tensions and rising defence expenditure. This is only partly true, however. The latest measures fit into an established policy of subordinating ODA to broader strategic objectives (in other words, “geopoliticising” aid, as one apt definition has it). Since the continent-wide migration crisis of 2015, European countries have linked assistance to recipient countries’ cooperation in curbing outward migration. The EU now also counts certain expenditure on managing immigration within its own borders as ODA.
Germany, despite having substantially scaled back its foreign assistance, remained the largest OECD donor on paper, with $29 billion in 2025. Yet the downward trend continues: the draft budget for the following year envisages a further 6% reduction in funding. France, amid mounting economic difficulties, has been cutting its development contributions for six consecutive years. The draft budget for 2027, unveiled recently, merely confirms the trend, with a 43% reduction (€1.9 billion). In the United Kingdom, the days when ODA amounted to 0.7% of GDP are now a distant memory; today the figure has fallen to a modest 0.3%. Japan has not slashed its funding as sharply, but the trend is still downward: $15.6 billion this year, compared with $16.5 billion last year.
The “new” provider countries—above all, the oil-rich monarchies of the Gulf—are generally in no position to replace the “old” ones, however much the latter might wish them to. Somewhat surprisingly, Turkey emerged as the largest provider country in this group, providing $6.7 billion in 2025.
China’s approach to ODA cannot be explored in any detail in this overview. Broadly speaking, the West’s partial retreat gives Beijing an opportunity to further consolidate its recently acquired image as the leading global champion of sustainable development. Yet the distinctly pragmatic underpinnings of this leadership cannot be ignored. China’s actions also reveal a clear logic of quid pro quo: infrastructure construction in exchange for access to natural resources, and security assistance designed to foster closer political ties with Beijing.
To sum up, the severe crisis of ODA should not be dismissed as a fit of selfishness on the part of the Global North (where major private donors, such as foundations etc., are still around) or as a reflection of the questionable effectiveness of multilateral organisations such as the UN, the World Bank, the IMF, and regional development banks. The conventional model of development assistance is genuinely running out of steam and needs to be reinvented. Above all, this means reconsidering the frame of the moral responsibility of developed countries towards those lagging behind coupled with the obligation of recipient countries to secure their own growth.
Equally important is the need to reach a consensus on how development and security should be linked in the modern world. The June issue of the American magazine Foreign Affairs featured a manifesto-like article entitled “The End of Foreign Aid Is Not the End of Development”. The formulation may be simplistic, but the slogan carries considerable weight.
All in all, sensational headlines aside, the overall picture is by no means entirely bleak. External assistance, combined with the efforts of Global South countries in pursuit of the UN SDGs, is delivering results. In 2000, 2.2 billion people worldwide lived on an income equivalent to $3 a day; today, that figure has fallen to 840 million. Between 2000 and 2024, life expectancy in low- and middle-income countries increased by six years. And the list of achievements does not end there.
There is no doubt that, sooner or later, Moscow will need to engage more deeply and substantively with development assistance in the Global South, moving beyond the realm of sound rhetoric, as exemplified by the Russia–Africa Forum. This will require a serious examination of foreign aid issues, some of which have been outlined above.
Alexander Gorelik, expert on international organisations
Иллюстрация: «За рубежом», Leonardo.ai
14.10.2026
news
Bolivian authorities want to put former leader Evo Morales behind bars. The ex-president is threatening them with civil war.
22.10.2026 09:00:00
The festival “Africa. Together into the Future” showcased the art of the continent in all its diversity.
21.10.2026 09:00:00
Other Articles
Bolivian authorities want to put former leader Evo Morales behind bars. The ex-president is threatening them with civil war.
The reasons why the EU has to change the rules before admitting new members.
The President of Argentina and his Minister of Deregulation, Federico Sturzenegger, are calling for a radical review of the extent of government intervention.
British diplomacy is stalling because London is trying to sit on two chairs. Kir Starmer wants to "reboot Brexit" with the European Union while also trying to maintain a special relationship with the United States, but he is not getting any real concessions from either Brussels or Washington.