Jump to navigation

Western aid spending heads towards the cliff-edge as US cuts bite

The OECD is warning that assistance to poorest nations must be protected to avoid ‘dramatic’ impacts

The Organisation for Economic Co-operation and Development (OECD) says that aid to struggling sub-Saharan African countries should be ringfenced amid the deep spending cuts threatened  by the United States and many European donors.

Aid fell by 7.1% in 2024, but the OECD expects it to drop by another 17% in 2025, as the USAID cuts bite. By 2030, aid spending could be 30% lower than it was in 2023. Net Official Development Assistance to sub-Saharan Africa dropped by 2% to US$36 billion, while aid to the group of least developed countries (LDCs) was $35bn, a fall of 3% in real terms.

The 2025 cuts would be the largest since it started recording aid spending, OECD officials told journalists on Wednesday 16 April. Karsten Staur, who chairs the OECD’s Development Assistance Committee, called for aid to the world’s 26 poorest countries, of which 23 are in sub-Saharan Africa, to be ‘ringfenced’ by donors.

He pointed out that in these countries development aid accounts for more than 60% of their external financing and that it is fanciful to expect that the private sector will plug the gap. ‘If ODA was stopped it would have an extremely dramatic, cataclysmic effect,’ he warned.

African states are already counting the cost of the three-month suspension to most USAID programs, and the shuttering of the agency itself, by US President Donald Trump (Dispatches, 28/1/25, Rubio deals hammer blow to US aid). Healthcare and education budgets are set to be the worst affected. Trump has exempted emergency humanitarian aid from the suspension.

However, the US cuts will be compounded by moves by Europe’s major donors, Germany, the United Kingdom and France, to slash their own development spending (AC Vol 66 No 5, Western aid cuts reshape the geopolitical landscape). All three have announced plans to cut aid budgets by over 30% by 2029.



Related Articles

DISPATCHES

Rubio deals hammer blow to US aid

An executive order from President imposes a 90-day freeze on most foreign funding – except military aid

Within hours of entering the White House, President Donald Trump issued an executive order for a three-month freeze on all foreign aid. This move seemed certain to result...

READ FOR FREE

Forgotten promises

In 2007, a just-elected President Sarkozy promised to remake France’s Africa policies but strategic political and economic interests still prevail

On 14 July, troops from 13 African countries marched down the Champs-Elysées in the annual Bastille Day parade, while elderly sub- Saharan veterans of the French colonial army...


And the good news

Amid the gloom lie some positives. African economies now have on average 5.7 months of reserves to cover imports, policy frameworks are sounder, government ministries are better staffed....


The water margin

Chinese companies are building dams and hydroelectric plants across Africa, just as the continent’s energy crisis begins to bite

A combination of strong economic growth and institutional neglect of investment in infrastructure has created a serious problem: South Africa, the continent’s largest and most developed economy, is running...