Once recipients of development aid, several Asian nations have transformed into donors themselves. Our latest analysis explores the aid spending patterns, priorities, and future directions of six key players, providing a glimpse into these nations’ growing influence on international development.
Also in this edition: The United Kingdom is blasted for having “no strategy” for child-focused aid, the potential of payment-by-results approaches, and a divided COP on carbon markets.
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Asia rising
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Over the past few decades, countries across Asia have transitioned from receiving aid to providing it. My colleagues Miguel Antonio Tamonan and Alecsondra Kieren Si pick apart the spending of six of those nations: Indonesia, Japan, Kazakhstan, South Korea, Taiwan, and Thailand.
Indonesia, which doesn’t report its aid money to the Organisation for Economic Co-operation and Development, spent $9.3 million on development in 2022 — a figure that was nearly 40% higher than that of 2021. The other five countries spent a collective $20.8 billion, representing a 17% jump in the same time period. Japan, which provided more than 80% of all that aid, is still the dominant force, but potentially getting less so.
Miguel and Alecsondra looked closer: Indonesia emphasizes global south-south cooperation, while Thailand focuses on neighboring Laos. Kazakhstan channels significant aid to Afghanistan, and Taiwan allocates funding across sectors like tourism and agriculture.
Drawing on data from the OECD and government sources, this analysis provides a snapshot of a new wave of donor nations contributing to global development — and in the coming months, we’ll publish a full, detailed report to follow.
Read: How much do Asian donors spend on development? (Pro)
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Funding activity
We publish tenders, grants, and other funding announcements on our Funding Platform. Here are some of the ones that have been viewed the most in the past 10 days.
The Asian Development Bank has approved a $500 million loan to support the Philippines’ efforts to implement climate-resilient and low-carbon reforms in key sectors and mobilize climate-related investments.
The European Union has signed a €190 million agreement to support the reconstruction of areas affected by the September 2023 earthquake in Morocco.
The OPEC Fund for International Development has signed a $30 million loan to expand financing for micro, small, and medium-sized enterprises, or MSMEs, particularly women-owned businesses, in Uzbekistan.
USAID has announced a $20 million commitment to improve water and sanitation services in Iraq across five governorates, focusing on strengthening water sector management, modernizing service delivery, and engaging youth in climate action.
The Central American Bank for Economic Integration approved a $5.9 million technical cooperation fund for pre-investment studies for several road infrastructure projects to improve connectivity, support economic growth, and enhance tourism in Costa Rica.
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The kids are not alright
The United Kingdom has “no strategy” to deliver aid for children after slashing its foreign assistance spending, according to a new survey from UNICEF UK — one that found the country’s share of bilateral, child-focused aid fell by 12 percentage points from 2016 to 2022. During the same time period, the study reported the proportion spent on education also plunged from 11% to 4%.
“If this government is serious about its claim of ‘Britain back in the world,’ and in playing a leading role in achieving the Sustainable Development Goals by 2030, it needs to rethink its approach to its aid budget,” Joanna Rea, UNICEF UK’s advocacy director, tells my colleague Rob Merrick.
The report said the country’s Foreign, Commonwealth & Development Office lacked a “central team” capable of “ensuring a child focus, as there is for gender.” It also warns that in the years to come, things are unlikely to improve — unless the U.K.’s new Labour government rethinks its aid spending priorities.
Read: UK has ‘no strategy’ for child-focused aid after cuts, UNICEF warns
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Could payment-by-results speed up localization?
The payment-by-results approach is gaining traction in the development sector, and now there are attempts to use it to empower local organizations.
Historically, money has tended to go to primes — often big INGOs — who then hire local organizations and tell them what to do. But what if the money went to the local organizations, which decided how to tackle the problems, and the INGO was just on hand to provide support with back-office functions?
That’s a model being trialed by, among others, INGO Educate Girls, using a structure where local organizations receive flexible funding to drive impact, geared around pre-agreed project results throughout a program’s lifecycle.
It’s early days, but the first results look encouraging — both as a way of delivering better results and as a way of empowering local leaders while doing so.
Read: Could a payment-by-results approach put local organizations in charge? (Pro)
An $80 billion question
On the final day of the 29th United Nations Climate Change Conference, or COP29, in Baku, Azerbaijan, countries finally came to an agreement on one of the most controversial ideas in the sector: Carbon credits, and how to buy, sell, and govern them across the world.
Within the carbon market, entities can buy carbon credits to compensate for their greenhouse gas emissions, purchasing credits from those that actually reduce emissions through planting trees, protecting forests, or other such activities. It’s an agreement that’s been a decade in the making, my colleague Jesse Chase-Lubitz reports.
While some say that it could bring $80 billion to the African continent, it remains controversial, with governments, private companies, civil society, and heads of state at odds about whether such a market should exist at all.
And the different perspectives remain. For Rueban Manokara, a carbon finance and markets expert at the World Wildlife Fund, the decision made at COP29 provided “a degree of clarity that has long been absent.” For Erika Lennon, a senior attorney at the Center for International Environmental Law, it “was nothing more than a dangerous distraction.”
Read: Will carbon markets enabled by COP29 really mean $80B for Africa?
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About the author
Elissa Miolene
Elissa Miolene reports on USAID and the U.S. government at Devex. She previously covered education at The San Jose Mercury News, and has written for outlets like The Wall Street Journal, San Francisco Chronicle, Washingtonian magazine, among others. Before shifting to journalism, Elissa led communications for humanitarian agencies in the United States, East Africa, and South Asia.
