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The new reality of less foreign assistance will require a rethink for many aid organizations — and a possible restructure. But makeovers are easier said than done. One initiative, though, is trying to make it a little more manageable.
Also in today’s edition: Is the development sector decolonizing in the wake of the aid cuts — or simply recolonizing? Plus, Japan steps into the climate void.
+ Upcoming event: Tomorrow, Aug. 19, Juho Uusihakala, senior development impact adviser at Finnfund, will offer a behind-the-scenes look at how the Finnish DFI provides technical support to its investees under the European Fund for Sustainable Development Plus. Save your spot now.
We’ve been covering how for-profits and nonprofits can navigate the world of mergers and acquisitions and other forms of restructuring, because these could be the key to surviving this new era of aid scarcity.
In fact, more than one-third of aid organizations today are considering a restructure — and by early September, even more may be forced to shut their doors.
That’s according to a survey from the Accountability Lab and Humentum, which in March launched a new program, Civic Strength Partners, to help those in the sector recalibrate. That might mean exploring a merger, creating a joint venture, coming up with a new fundraising approach, or winding down operations altogether, my colleague Elissa Miolene writes.
“Many organizations in the social sector have not had to look at their work through the lens of transition, merger, and succession,” reads the Civic Strength Partners’ tool kit. “This guide is designed to provide rapid support to leaders to use relevant tools to preserve, protect, and grow the value of their work.”
Four months into the project, interest has ballooned. Within weeks of its launch, 80 organizations — ranging from nonprofits to contractors — had signed up for the service; by early August, that number had swelled to more than 150, according to Cheri-Leigh Erasmus and Blair Glencorse, co-CEOs of the Accountability Lab.
“It’s come quite a long way,” Glencorse tells Elissa. “We have a shared fund now, which donors have put money into, and we have a pool of technical expertise that we’re farming out to help organizations do what they need to do.”
“For some organizations, it is an incredibly daunting time,” Erasmus adds. “And for others, it’s a time of opportunity. It all boils down to how much you have in the bank.”
Read: As US aid dwindles, more turn to restructuring to stay afloat (Pro)
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The development sector has strived to move beyond its past colonial mindset, blamed for perpetuating inequality between the global north and south. But will the loss of billions in development dollars usher in a new kind of colonialism?
That’s the question Patrick Fine of the Brookings Institution poses in an opinion piece for Devex.
“Unfortunately, what is replacing the faltering international development industry looks extractive, coercive, and exploitative, echoing the colonial era’s scramble for resources and influence through conquest, proselytizing, and exploitative trade,” he writes.
“Colonialism’s ‘three Ms’ — mercenaries (the Wagner Group in the Sahel), missionaries (Islamic extremists and Christian fundamentalists), and merchants promoting ‘trade not aid’ — again compete for resources and influence,” he adds. “This environment favors authoritarianism and stokes ethnic and tribal divisions for plunder and profit.”
He wouldn’t describe this new era as neocolonialism, however, given how complex and crowded our multipolar world has become. Still, the prevailing narrative of might makes right doesn’t bode well for the global south.
“Replacing goals of sustainable development and shared prosperity with ideologies of narrow self-interest is bound to result in an increasingly contested, unpredictable, and unhappy world.”
Opinion: Is global development decolonizing or recolonizing?
Related: How do we fix aid? (Pro)
One man’s loss is another man’s gain, or so the saying goes. Could the same apply to countries?
Japan may be banking on it.
Under President Donald Trump’s climate-skeptic administration, the U.S. withdrew from Indonesia’s $20 billion Just Energy Transition Partnership, or JETP — a blow to a historic climate change venture that aims to wean countries away from coal without endangering their local economies.
But Japan, which co-led the partnership with the United States, has quietly stepped into the void to keep the critical endeavor — which could serve as an energy transition model for countries around the world — going. That’s good news, right?
Not quite, Devex contributor Nithin Coca writes. That’s because Japan may be more interested in helping itself than Indonesia. Japanese agencies have been advancing their own vision for Indonesia’s energy future, one that favors Japanese-developed technologies over the rapid coal phaseout that JETP originally envisioned.
Specifically, “the Japanese government is recommending co-firing liquefied natural gas as a transition fuel, carbon capture and sequestration (CCS), and, in the long term, hydrogen and ammonia,” Hozue Hatae, a campaigner with Friends of the Earth Japan, tells Nithin. Critics say these fossil fuel-related technologies, heavily promoted by major Japanese companies such as Mitsubishi and JERA, are costlier, riskier, and offer little climate benefit.
“We are concerned about Japan pushing what we consider false solutions to Indonesia,” Hatae says.
Still, many aren’t giving up hope that JETPs could be game-changing, despite all of their ups and downs over the years.
“I think JETP has made progress,” says Dinita Setyawati, a Jakarta-based senior energy analyst. “The infrastructure is there, the work is there, and the investment is focused on the whole-system change we need, expanding the grid, a coal phaseout, and renewable energy.”
“The U.S. has clearly shown that it is now anti-climate change, so a U.S. role in the JETP would have been more of a hindrance than a help,” adds Grant Hauber of the Institute for Energy Economics and Financial Analysis. “It would behoove the Japanese government to look at a diversified portfolio and assist Indonesia to advance their renewable energy program.”
Read: As US exits Indonesia JETP, Japan pushes competing energy visions
Background reading: Slow progress on Indonesia JETP raises concerns about coal transition
One country working to become a global advocate for fighting climate change is Brazil, host of this year’s 30th U.N. Climate Change Conference, or COP30, which will serve as a monumental test of the country’s leadership on the issue.
According to Júlia Gouveia, a climate change and emergencies specialist at Plan International Brazil, the country is already failing on one key front: accessibility.
In an opinion piece for Devex, she argues that “just months before the event, the barriers to participation are overwhelming. For most young people, even those who live in Brazil, getting to Belém, the COP30 host city, feels nearly impossible. It’s not for lack of interest or experience. It’s because of cost, logistics, and a lack of meaningful access to decision-making spaces.”
This is highly problematic because the growing phenomena of “droughts, floods, displacement, and school disruptions are part of daily life for the young people I work with in Brazil,” Gouveia points out.
But there’s still time to dismantle barriers and make the conference more inclusive.
“That means funding safe and accessible accommodation, especially for young women and girls. It means offering subsidized travel for Brazilian youth and delegates from low-income countries,” she writes. “It also means simplifying the accreditation process so that grassroots groups and youth-led movements can attend without unnecessary bureaucracy. And above all, it means ensuring these young people aren’t just visible — they are included in the core decision-making spaces that shape global climate policy.”
Opinion: For Brazilians, the barriers to COP30 participation are overwhelming
Related: High stakes and uncertain plans as Brazil's Amazonian COP30 approaches
Hundreds of thousands of children in northeast Nigeria risk starvation as the World Food Programme prepares to shut down its last 150 nutrition clinics in September due to a severe funding shortfall driven by global aid cuts. [The Telegraph]
Starvation also looms in Myanmar’s blockaded Rakhine state. Due to global funding cuts, WFP is only able to feed 20% of those in Myanmar facing severe food insecurity. [BBC]
Heavy flash floods brought about by rare weather phenomenon cloudburst claimed over 300 lives in Pakistan. [Reuters]