Aid Reaches All-Time High but Still not Quite Enough

Development aid reached a

of $119.80 billion in 2008 notwithstanding the global economic slack, providing a ray of hope in these rather gloomy times that rich countries – though hard up themselves – would not renege on their commitments.

The Organization for Economic Cooperation and Development reported that this record figure tallied up to 0.3 percent of the gross national income of 22 of its 30 members belonging to the Development Assistance Committee.

With $26.01 billion, the U.S. leads all donors. Germany came in second with $13.91 billion, followed by the

with $11.41 billion, France with $10.96 billion, and Japan with $9.36 billion.

Core aid programs were also

in 2008 as bilateral and multilateral aid amounted to nearly $100 billion based on preliminary data, while the rest of the sum was used for humanitarian aid and debt relief.

Staggering as these contributions appear, they were still

the United Nations target of at least 0.7 percent of GNI.

In fact only five OECD countries have actually reached or

this level: Sweden, Luxembourg, Norway, Denmark and Netherlands.

Development aid as a share of GNI from DAC members will likely not meet the U.N. standard either. It touched 0.30 percent in 2008 while its highest level was 0.33 percent recorded in 1992 and 2005. Based on OECD's projections, total commitments as a share of national income would amount to 0.39 percent in 2010.

In real money, that would add up to $121 billion in constant 2004 prices, $10 billion less than earlier pledged due to lower growth in 2008 and the prospect of further slowdown in 2009.

But OECD said a new survey of donors' forward spending plans suggested that aid might grow by as much as 11 percent between 2008 and 2010. Still this will not be enough. OECD pointed out that donors need another $10 billion to $15 billion to meet 2010 commitments.

"Only a special crisis-related effort can ensure that the 2010 targets for aid are met, which is even more important now that the economic crisis is reducing developing countries' growth prospects and their ability to make progress towards the Millennium Development Goals," OECD said.

How badly has the global recession impaired efforts to dent poverty? In Asia alone, more than 60 million people in 2009 and nearly 100 million people in 2010 will remain

than would have been if high growth were sustained, according to the Asian Development Bank. Two-thirds of the world's poor, or 1.8 billion people, live in the region.

Cutting aid in the throes of the crisis will be disastrous for developing countries That's an indisputable fact, which hopefully no one will fail to remember.

Louis Michel, European commissioner for development and humanitarian aid,

member states to be resolute in sticking to their pledges.

"Next years' aid figures will be critical. … Investing in developing countries is ultimately an investment in ourselves and so I will not allow the current recession to be used as an excuse to cut back on aid," he said.

World Bank President Robert Zoellick warned that the global economic slowdown could transform into "

" if wealthy nations neglect developing ones.

Ahead of the G-20 summit he said, "I think it would be a big mistake if this becomes a summit for high finance with silence for the poor. A commitment to put in place structures and fund safety nets for those most at risk would go a long way towards showing that this 'G' group will not embrace a two-tier world."

About the author

  • Josefa Cagoco

    Sef Cagoco served as one of Devex's international development correspondent from mid-2008 to mid-2009. Her writing focused on social entrepreneurship and multilateral agencies such as the U.N. and Asian Development Bank. She previously worked as senior reporter for the national daily BusinessWorld and a production journalist for the Financial Times.