World Economy

ODA to Poor Nations Falls

ODA to Poor Nations Falls ODA to Poor Nations Falls

Rich countries’ development aid hit a record high in 2014 but the share that reached the world’s poorest countries was the lowest since 2006, the Organization for Economic Cooperation and Development said.

Official development assistance reached $137.2 billion in 2014, $2 billion more than in 2013, the Paris-based international think-tank said, Reuters reported.

But ODA to the poorest countries fell for the second year, dropping by 9.3% in real terms from 2013 levels as some funds were diverted to other countries, the OECD said.

“It’s been a worrisome trend that’s been going on for a number of years now,” Yasmin Ahmad, manager of the OECD’s data collection unit, told the Thomson Reuters Foundation in a phone interview from France. He said the OECD’s Development Assistance Committee “is trying to highlight this issue and is very much focused on putting the least developed countries as prime focus again.”

The least developed countries together received $43.7 billion in ODA in 2014—30% of the total and their lowest share since 2006.

The OECD said that aid to the poorest countries had fallen—by $4.5 billion in 2014—partly because of lower levels of debt relief to Myanmar, VoA reported.

“This news must act as a wake-up call to world leaders who should urgently commit 50% of their aid to the world’s least developed countries,” Adrian Lovett, Europe executive director for the advocacy group ONE Campaign, said in a statement.

Afghanistan Gets Most

Afghanistan, which received $4.8 billion, was the largest recipient of net ODA, followed by Vietnam, Syria, Pakistan, Ethiopia, Egypt and Turkey.

“It’s good to see a slight increase in aid in these difficult times globally, but unfortunately the OECD presents a very one-sided picture,” Matti Kohonen, the charity Christian Aid’s adviser, said in a statement.

Developing and emerging countries lost an estimated $1.1 trillion in illicit financial flows in 2013, Kohonen quoted the Washington-based research and advocacy group Global Financial Integrity as saying.

“The OECD needs to take these figures into account if a balanced picture is to be drawn,” he said.

The OECD said it does not measure illicit financial flows or corruption, but some of the development assistance it does measure goes into fighting such flows.

Of the 28 members of the OECD’s Development Assistance Committee, the United States remained the largest donor by volume in 2014 with $33.1 billion, Britain with $19.2 billion, followed by Germany, France and Japan.

 Brits Complain

Domestic spending–money taken from British taxpayers that is being spent for the benefit of British taxpayers–has fallen to £695million ($1.01 billion). Spending on UK flood defenses is down by 14%. But if you live in Serbia the picture is very different thanks to British taxpayers. Not that it is just Serbians who have reason to be grateful for our largesse, BBC reported.

While George Osborne imposes a series of spending cuts on domestic spending–all of which are necessary and important if our public finances are to be restored–he is engaged in a helter-skelter dash to spend, spend, spend overseas. A report by think tank the OECD found that Britain now spends more on foreign aid than any other nation in Europe.

No other EU member state with a significant economy pays any attention to the arbitrary target set by the UN of 0.7% of the economy to be spent on foreign aid. Indeed only five of the nations defined as major donors by the OECD meet it–the UK, Denmark, Luxembourg, Norway and Sweden. The Czech Republic and Greece hand over just 0.11%.

 Portugal Aid Dwindling

Portugal’s foreign aid budget is dwindling and action is needed to stop it declining further, an OECD review has found, Yahoo reported.

A DAC peer review found the amount of ODA offered by Portugal has dropped for three years in a row, and now stands at $419 million, equivalent to just 0.19% of gross national income. This is significantly short of the 0.7% demanded by the United Nations target and also below the average of 0.3% found across the OECD.

The OECD is warning that without opening up new credit lines or expanding the grant elements of its aid program, Portugal’s aid volumes will continue to decline.