Germany plans billions in cuts to development, humanitarian aid

After severe cuts to the 2024 budgets for development and humanitarian aid, the German government is planning to slash funds again in 2025. A recently released draft budget spells out nearly €1 billion in cuts to the Federal Ministry for Economic Cooperation and Development, or BMZ, from €11.22 billion ($12.36 billion) this year to €10.28 billion in 2025. The proposed cuts to humanitarian aid are even more drastic, with plans to slash spending by more than 50% — from €2.23 billion in 2024 to €1.04 billion next year. The German Parliament, known as the Bundestag, must still sign off on the budget, which will happen before the end of the year. But experts said parties are likely to lock their priorities in place over the coming days. “The key decisions in the parties will be taken over the next few days,” Alina Hemm, a senior consultant at SEEK Development, told Devex. And while there might be the potential for some movement within the envelope assigned to BMZ, she said it seemed unlikely that the overall allocation would grow. “We’ve seen that it’s hard to increase the overall budget within the parliamentary budget process,” she said. German civil society organizations have decried the proposed cuts, which they worry signal a retreat from the government’s engagement with the multiple crises happening in the world. “Germany, as the third-biggest economy in the world, should show its responsibility for advancing the development agenda and responding to the humanitarian crises we face,” Mathias Mogge, the secretary general of WeltHungerHilfe, told Devex. BMZ, when asked for comment about the impact of the proposed reductions, pointed to an interview Development Minister Svenja Schulze gave in mid July. While she described herself as “displeased by the cuts,” which were originally tabled in projections that the finance ministry released months ago, she said she was “glad that it has been possible to reach an agreement in these globally challenging times.” However, with most of the BMZ budget already allocated for 2025 through long-term agreements, Schulze said she would be forced to cut short-term spending and may also have to reduce Germany’s contribution to multilateral initiatives. Mogge is particularly concerned about a nearly €400 million proposed cut to a pool of funds for transitional aid that many NGOs rely on. It is set to fall from €1.04 billion in 2024 to €645 million next year. “For us, this is the most painful reduction,” he said. “Many of the NGOs are working in very fragile contexts and this funding offered the flexibility which we need in these contexts.” BMZ and the Ministry of Foreign Affairs, which controls the humanitarian aid budget, are not the only departments to see their funding reduced. The German government is planning to spend €8 billion less in 2025 than it budgeted for 2024. But the two departments ultimately saw the steepest proposed cuts. “We’re seeing a strong discrepancy between the global demand and Germany’s contribution to human development on the other side,” Hemm said. “Germany used to be a real champion, but we see BMZ dropping to pre-pandemic spending levels. The issue with that is we are not in pre-pandemic times and demand is still incredibly high.” In part, the cuts reflect the Free Democratic Party’s commitment to adhering to the debt brake, a constitutional provision that ties the amount of new debt the government can take on to the country’s gross domestic product. As part of the three-party governing coalition, which includes the Social Democrats and the Greens, the FDP controls the Ministry of Finance, where it has consistently imposed strict fiscal discipline. But experts say BMZ and the humanitarian aid budgets are seen as particularly vulnerable in the current political climate. The far-right Alternative for Germany, or AfD, party made significant inroads in two state-level elections last month, including taking the most votes of any party in the eastern state of Thuringia. It is the first time a far-right party has won a state vote in Germany since World War II. During their rise, the right-wing parties have criticized German spending abroad, calling for that money to be channeled domestically. AfD recently took aim at Schulze, for instance, for investments BMZ has made in bicycle paths in Peru as part of a broader initiative to fight climate change. In this environment, a longstanding FDP proposal to fold BMZ into the Ministry of Foreign Affairs is also circulating again. In an interview, Shulze said the FDP’s proposal “is certainly not the view of the majority.” Mogge said there is still an opportunity to counter the criticism to Germany’s international engagements and potentially reclaim some of the funding cuts before the budget is finalized later this year, likely in November. “There is still room for change and for discussion and for advocacy work,” he said. “As development actors, we need to do more to convince the public of the valuable work we do.”