Global aid levels decrease by 2.7%: OECD DAC data is released for 2011

On 4 April 2012 the Organisation for Economic Co-operation and Development (OECD) released the preliminary official aid figures of donors’ global disbursements for 2011. The official OECD press release states that global official development assistance (ODA) levels have fallen by 2.7%, with 16 out of 23 donors decreasing their disbursements since 2010.

However, when debt relief is excluded a slightly different picture emerges. Global aid levels have decreased for the first time since 1998 (bar 2006), and this by just over US$3.5 billion, which represents a 2.7% decrease in real terms. The adverse impact of the current recession on several of the Development Assistance Committee (DAC) donors’ aid budgets has been evident.   

Fifteen of the 23 DAC donors decreased their global aid levels in real terms between 2010 and 2011, of which Japan, Spain and the United States reported the largest reductions, each of over US$1 billion. Similarly, Greece’s aid decreased by almost 40% in 2011. The G7 countries alone accounted for 55% of decreases in total DAC global aid between 2010 and 2011 and the European-15 donors for just under a third (with 11 out of the 15 donors reporting a decrease), although commendably Germany and Italy reported increases.

Whilst aid levels have fallen globally, DAC aid to sub-Saharan Africa (excluding debt relief) increased by 4.0% between 2010 and 2011, although no one donor reported a particularly large growth in disbursements. The largest increases in volume to the region were reported by Germany, Sweden, United Kingdom and Japan at just over US$300 million each.

Despite an overall increase in aid levels of close to US$ 1.7 billion, ten donors decreased their aid to the continent. With the exception of Canada and Norway, these cuts came from European-15 donors. Conversely, five donors who decreased their global aid levels (Japan, Netherlands, Portugal, United Kingdom and United States) actually increased disbursements to sub-Saharan Africa, indicating a prioritisation at the expense of other regions.

Looking beyond 2011, the OECD-DAC Survey on Donors’ Forward Spending Plans for 2012 to 2015, which will be released in June 2012, predicts that global aid (measured here as country programmable aid) is expected to increase by 6% in 2012, a result largely of increases in soft loans from multilateral agencies. However, from 2013 onwards, aid levels are predicted to stagnate with the full impact of the recession falling on the aid budgets of most DAC donors.