In 2024, global aid fell for the first time in five years

Global aid flows fell sharply in 2024, marking the first decline in official development assistance, or ODA, from major donor countries in half a decade, according to preliminary figures released by the Organisation for Economic Co-operation and Development on Wednesday. Member countries of the Development Assistance Committee, or DAC, contributed a combined $212.1 billion in ODA last year, representing 0.33% of their collective gross national income. But that total reflects a 7.1% drop in real terms compared to 2023, and ends a streak of steady growth. The downturn comes amid what experts describe as a recalibration of donor priorities, driven by a sharp decline in funds earmarked for Ukraine, a significant drop in refugee-related costs within donor countries, and reduced humanitarian spending overall. Carsten Staur, chair of the OECD Development Assistance Committee, noted that this was the first time he had to preside over an announcement of a drop in ODA during a press conference on Wednesday. “The pendulum now seems to swing more toward focusing on the immediate future and the immediate neighborhood,” he said. "I would call on DAC members to sincerely reconsider and to reverse this trend." Where aid is shrinking Much of the decrease can be traced to a pullback in aid to Ukraine. Preliminary figures show bilateral ODA to the conflict-afflicted country fell 16.7% in 2024 to $15.5 billion, down from the emergency-driven highs of the previous year. Humanitarian support to Ukraine dropped even more steeply — by 43% — to $1.8 billion. Meanwhile, the European Union’s collective institutions spent $19 billion on Ukraine, more than half their total net ODA, but even this fell short of 2023’s levels. Humanitarian contributions from the EU also slipped to $372 million. The reduced Ukraine spending also impacted humanitarian aid writ large. Total global humanitarian ODA dropped nearly 10% to $24.2 billion in 2024, as donor focus shifted away from short-term crisis response. Meanwhile, ODA to Africa fell modestly by 1% to $42 billion, while funding for sub-Saharan Africa dipped 2% to $36 billion — though Staur noted that even that small proportion means a lot when countries depend on ODA for a large percentage of their gross national income. Least developed countries, or LDCs, saw a 3% drop in bilateral ODA from DAC members. Analysts suggested this decline may be partially offset once full multilateral disbursement data is finalized later this year. The refugee factor ODA reporting rules allow countries to count the costs of hosting refugees during their first year in the donor country, and those numbers also fell. In-donor refugee costs plummeted 17.3% to $27.8 billion last year, reflecting both reduced arrivals and tighter budgets. For five donor countries, however, refugee-related costs still made up more than a quarter of their reported ODA — a trend that has drawn criticism from NGOs and development advocates, who argue that these domestic expenditures crowd out funding for development programs abroad. The bright spots Despite the overall downturn, some donors bucked the trend. Korea (+24.8%), Portugal (+21.3%), and Belgium (+12.2%) all increased their contributions, with Portugal and Belgium significantly boosting multilateral support. The United States remained the largest donor by volume in 2024, providing $63.3 billion — 30% of total DAC aid. Germany followed at $32.4 billion, the United Kingdom at $18 billion, Japan at $16.8 billion, and France at $15.4 billion. Together, these five accounted for 69% of all DAC ODA. But while the U.S. and several others maintained sizable commitments, the Group of Seven and EU donor blocs, which together represent the bulk of global ODA, reported widespread declines, largely attributed to reduced refugee hosting and the completion of one-off financial packages to the World Bank’s International Development Association, or IDA, and the International Monetary Fund’s Resilience and Sustainability Trust. “Wealthy countries appear to be making these cuts with a startling degree of short-sightedness and impunity,” said Matthew Simonds, senior policy and advocacy officer at Eurodad. “They keep favouring their geopolitical priorities, contributing to further diversion and inflation of aid. It is clearer than ever that the way aid is governed is not working and must change.” Sovereign loans remained stable, increasing just 0.3% in real terms. Japan, Korea, and France stood out for high proportions of loan-based aid, with Japan’s loans making up 56% of its bilateral ODA. Meanwhile, private sector instruments — loans and guarantees extended to stimulate investment — accounted for nearly 2% of total ODA, or $3.8 billion, although the final data on these figures won’t be available until December. This latest ODA report also reflects the ongoing transition to the OECD’s grant equivalent accounting method, designed to standardize comparisons between grants and concessional loans. Uncertain path ahead Final 2024 ODA data, including multilateral flows and private sector instruments, will be published in December. But early figures suggest the global aid landscape was already undergoing a fundamental shift in 2024, ahead of the destabilizing U.S. aid cuts — with fewer resources available for long-term development, and more pressure on multilateral banks and private capital to fill the gap. Several experts said that the upcoming United Nations conference, the International Conference on Financing for Development, will be a pivotal moment for the future of aid. “The UN Financing for Development conference is a once-in-a-decade opportunity to write a new future for foreign aid,” said Simonds. “By shifting governance away from exclusive, closed-door institutions like the OECD, and bringing it under the umbrella of the United Nations, countries from the global north and south have a crucial opportunity to re-legitimise aid and develop a more representative and democratic process where all countries can participate on an equal footing. This is a chance that cannot be missed.” "There is solid international momentum to restore trust and equity" ahead of the conference in Seville, said Pilar Garrido, OECD director for development cooperation, at Wednesday’s press briefing. OECD officials emphasized that even with a drop in funding and a rise in need, high-income countries cannot expect to dictate the terms of aid entirely. "Our partner countries are the drivers of their own development,” said Staur. “Going forward, the DAC will continue to reflect on how to make development cooperation fit for purpose and fit for the future."