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Slight increase of global aid explained by rise of in-donor refugees’ costs

Brussels, 11 April 2017 – For two consecutive years, global development aid has increased, according to the latest figures released today by the OECD Development Assistance Committee (DAC). The 2016 statistics report an increase of 8.9% (USD 142.6 billion). However, 1.8% of this increase actually stayed in the donor country, including EU Member States, with relatively little effect on poverty eradication and sustainable development since it is used to cover in-donor costs to address the refugee crises. At the same time, net global bilateral ODA to least developed countries fell by 3.9% in 2016 (USD 24 billion).

While 10.7% of the world’s popuation still live in extreme poverty [1] and world’s inequality is rising [2], EU Member States again failed collectively to meet the 0.7% ODA/GNI target with EU aid reaching 0.51% of their collective GNI which remains off track to meet the 0.7% target by 2020. Indeed, only 5 EU countries respected their commitment: Denmark, Luxembourg, Sweden and the United Kingdom welcoming Germany to this short list. Unfortunately, the Netherlands dropped out of that select group for the first time since 1974.

EU aid did increase by 13.1% (USD 81.3 billion) but much of this reflects growing in-donor refugee costs. DAC rule allows donor countries to count certain refugee expenses as ODA; Germany spent over 20% of ODA for refugee costs in 2016.

 

The achievement of the 0.7 percent target in the election year is a swindle. A large amount of the total expenditure is spent on domestic refugee costs. Germany thus inflates the spending on development cooperation and remains the largest recipient of its own resources for development cooperation. We strongly discourage other EU countries to follow this path.

Bernd Bornhorst

Chairman, VENRO, the German NGDOs platform

In spite of this inflated global increase, CONCORD, the European Confederation of Relief and Development NGOs, regrets that aid is being diverted from the countries most in need. Development aid is being instrumentalised as an incentive for governments to cooperate with the EU on its migration and security measures.

Supporting refugees arriving in Europe is absolutely the right thing to do, and something we as Europeans should be proud of. But counting in donor refugee costs as aid – money spent in the  donor country which never reaches a developing country – is of questionable development impact at best and certainly an attempt to artificially inflate countries’ aid figures. Aid should be used to support people out of poverty and help to promote sustainable, long-term change in developing countries – including tackling the root causes of forced migration.

Amy Dodd

Steering group member for the CONCORD Financing for Development working structure and Director of the UK Aid Network

CONCORD worries that this trend could be the basis of the renewed EU Consensus on Development. Such an approach is not acceptable in a document that will guide the implementation of the 2030 Agenda at EU level.