Revealed: EU aid’s losing internal battle to halt spending cuts

The European Commission’s humanitarian arm tried and failed to head off steep reductions in the commission’s development budget last year, arguing internally against the “dramatic and disproportionate cuts for countries in situations of crisis or fragility.” Commission documents, obtained by Devex through an access to information request, show DG ECHO — the directorate-general responsible for humanitarian aid — at first blocked the proposal altogether, putting it at loggerheads with the Directorate-General for International Partnerships, or DG INTPA, the development branch of the European Union executive. In the end, INTPA won. In releasing the internal documents to Devex, the commission wrote that ECHO’s objections prompted follow-up discussions and that ECHO eventually accepted the changes, with some comments. “Therefore, the documents do not reflect the position of the whole Commission and cannot be quoted as such,” a commission staffer wrote. Yet, multiple sources told Devex that the internal battle was only resolved after the office of European Commission President Ursula von der Leyen overruled ECHO’s objections in a meeting in mid-September. Inter-service aggravation Last year, INTPA combined the already-foreseen midterm review of its 2021-2027 budget with instructions in February from EU national leaders to cut around €2 billion from the commission’s development spending in order to bolster other priorities like supporting Ukraine and preventing migration. The result, eventually approved last fall, saw the commission cut individual allocations to almost every country as it created new regional “investment envelopes” in sub-Saharan Africa, Asia-Pacific, and Latin America and the Caribbean. These give Brussels greater flexibility to scale up its Global Gateway infrastructure strategy through the use of blended finance and budget guarantees for mostly European development banks. But those still unproven tools are less applicable in lower-income, grant-dependent countries, who were hit hard by the cuts. For instance, a breakdown of the average annual funding for 2025-2027 compared to 2021-2024 that was obtained by Devex showed cuts of 73% for Central African Republic, 48% for Togo, and 45% for Malawi. The commission told EU states last year that the cuts would fall “mainly in countries with a less performant partnership,” while the new investment envelopes are designed to provide more flexibility “to better pursue EU strategic interests in connection with the external dimension of internal policies,” such as critical raw materials and clean energy. Behind the scenes, however, the commission’s humanitarian aid department raised numerous concerns with that approach. In its internal response last year, obtained by Devex, ECHO told the other commission services that the 2025-2027 funding plan: • Violated the requirement under the commission’s 2021-2027 development regulation to prioritize countries “most in need.” • Contradicted EU states’ instructions in various policy documents to increase the share of support to least developed countries, or LDCs (which has been in decline for decades). • Made progress “effectively impossible” toward the humanitarian-development-peace nexus in many countries. • Harmed the EU’s geopolitical interests, given that the likes of Afghanistan, the Central Sahel, and Sudan need support not just “from a humanitarian perspective but also because of their relevance to EU security, regional stability and migration policy objectives.” • Overlooked the capacity of the United Nations and NGOs to implement programs in countries where the EU itself was “politically estranged” from the government. • “Makes it difficult to understand the strategic choices underpinning the proposal, and their financial implications country by country.” ECHO expressed serious concern about three areas in particular: Afghanistan, Central Sahel, and Sudan, where it said that the cuts risked “severely reducing the effectiveness of the humanitarian response as well as contributing to further conflict, radicalisation, displacement and migration.” On Afghanistan, ECHO warned that despite lumping support under a new “countries in complex settings” funding envelope (together with Iran, Myanmar, and Yemen), it was clear that “severe cuts will be made.” ECHO argued that INTPA’s support of around €145 million annually in 2022-2024 (channeled through the U.N. and INGOs) was crucial to Afghanistan and that humanitarian aid alone — from ECHO’s own separate, smaller budget — “has neither the financial volumes nor the ability to deploy the type of sustainable basic needs, livelihoods and population resilience building actions that required to deal with the multi-faceted crisis in Afghanistan.” On the Central Sahel (Burkina Faso, Niger, and Mali), plus Sudan, ECHO wrote that the amount foreseen (€238 million) in coming years is “four times less” than what was initially planned for these countries’ combined individual envelopes in the 2025-2027 period. “A reduction in funding of this scale puts at risk the dividends of 20 years of development funding invested in human capital and food security,” ECHO wrote, adding that would “most likely lead to impacts for the (very young) population that would be detrimental EU interests” — an apparent reference to the possibility of more people trying to reach Europe. The behind-the-scenes dispute spilled into the open in early September when then-humanitarian aid commissioner, Janez Lenarčič, told the European Parliament that support for infrastructure projects “should not come at the expense of assistance to people to get on their own feet, get their livelihoods, and no longer depend on humanitarian aid.” Responding to ECHO’s concerns, INTPA wrote that: • The requirement to prioritize funding for the most needy countries should be “read in conjunction” with another principle contained in the regulation that advises taking into account recipient countries’ “capacity and commitment to promote shared values, principles and interests.” • “A stringent prioritisation is needed more than ever to focus on areas where the EU can achieve greater impact … contributing to the EU’s strategic interests, whether related to economic, migration, security or more broadly political priorities.” • A more flexible approach to funding in countries with hostile governments is foreseen through “complex settings” envelopes in regional programs, and further funds could be mobilized beyond these envelopes. • LDCs still account for 69% of country allocations in 2025-2027, only slightly down from 72% in 2021-2024. • The amounts earmarked for Asia and sub-Saharan Africa for migration and forced displacement are being increased “despite the overall pro rata cut on budgets,” which will facilitate ongoing funding for Afghan refugees in neighboring countries. On Afghanistan, the Central Sahel, and Sudan, INTPA argued the 2025-2027 funding plan “cannot exclusively be assessed by allocations, as it provides a comprehensive and flexible approach able to better respond to complex and dynamic settings.” And in the Sahel — where, as the European Council on Foreign Relations put it recently, the EU faces three openly antagonistic military juntas cutting deals with rival powers like Russia — INTPA said it planned more “high impact actions” as well as more strategic communication and “soft power activities aiming to (re)build a bond of trust between the EU and the people of the Sahel.” “Our development package would be used as leverage in our political dialogue and serve our common strategic benefits and interests,” INTPA added. ‘Necessary reassurances’ When ECHO finally transmitted its positive opinion on the changes on Friday, Sept. 13, 2024, at 4:57 p.m., it noted that it had received two reassurances from INTPA. First, that Afghanistan is “the most important country for us in the region” which would therefore “be prioritised when it comes to the share of the funding under regional envelopes.” And second, on the Central Sahel, given that “the security of the region impacts us in Europe … we will want to continue engaging to the largest extent possible,” with a preference for programs on resilience, security, and human development. The changes with the new 2025-2027 country allocations were published in November, though without the direct comparison with 2021-2024 funding (provided to EU member state officials and obtained by Devex) that shows the severity of the country-level cuts. When then-EU development commissioner, Jutta Urpilainen — who oversaw the review of the 2025-2027 figures despite her five-year term concluding at the end of 2024 — announced the changes, she repeated that the EU would “continue to … ensure support to the fragile partner countries” and that “we remain committed to leaving no one behind.” Yet, ECHO had written in its initial objections that the cuts to fragile regions, such as the Sahel, were “not consistent with the narrative” that EU support would “[continue] to address the multi-faceted drivers of fragility and instability” even in countries where the political relationship was strained with the national government. Julieta González, director for Belgium and EU representative at CARE International, told Devex by email that cuts to development funds, particularly in crisis settings, risk putting humanitarian funding under more pressure and depriving communities of essential services. Meanwhile, Roberta Fadda from the European humanitarian NGO confederation VOICE told Devex by email that the EU “must also be a reliable partner in fragile contexts and in those in which there is no reasonable expectation of a return on investment.” A commission spokesperson told Devex by email that it had nothing to add to the “necessary reassurances” provided to ECHO.