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CONCORD’s 2024 AidWatch report reveals that Official Development Assistance (ODA) from EU Member States increasingly serves national self-interest, falling short in both quantity and quality.
Brussels, 22 October 2024 — The 2024 AidWatch report, released today by CONCORD, exposes the stark contrast between the narrative pushed by EU institutions and governments and the reality behind the ODA figures they report. Upon closer inspection, ODA is being inflated, diverted and manipulated. More than fifty years after the United Nations set the 0.7% of GNI spending target for ODA in 1975, most EU countries still fail to meet this commitment. This has resulted in an ‘aid debt’ to partner countries of over EUR 1.2 trillion!
The report uncovers how EU Member States inflate and divert ODA by channelling funds towards national economic and political objectives. Over one in every five euros reported as ODA by the 27 EU Member States fails to meet the criteria defining ODA. Worse still, OECD DAC rules allow this diversion of ODA. The exaggerated ODA figures are mostly due to the reporting of domestic refugee costs as international assistance, and the inflated reporting of debt and development finance transactions.
Country-specific analysis of the quantity and quality of ODA reveals widespread issues across Europe. Germany alone reported EUR 8.6 billion of inflated and diverted ODA for 2023, while countries like France are cutting development budgets, with further reductions likely. Even Sweden, the first country to reach the international ODA target, has abandoned its 1% target and set a three-year plan to decrease aid spending.
“In a world facing so many crises, the Swedish government’s plan to go below the international ODA target is shameful. And made worse by Sweden treating its new budget cap on in-donor refugee costs as if it were a target rather than a limit, even adding non-ODA-eligible costs to inflate its aid budget going forward!”
Åsa Thomasson
Policy Adviser, CONCORD Sweden
Following Russia’s war in Ukraine, we saw a historic peak in public funding reported as ODA being used to cover the costs of hosting refugees in the EU. This spending, referred to by the OECD as ‘in-donor refugee costs’ has been excessively reported by DAC countries – a trend which has elicited severe criticism from the Chair of the OECD DAC. However, reporting in-donor refugee costs as ODA continues to be a significant trend in several EU Member States, despite the drop in the number of arrivals of refugees between 2022 and 2023 in some countries.
In the coming years, the European Commission will cut EUR 2 billion in planned international cooperation spending, further jeopardising international cooperation commitments. How these cuts are implemented and which partner countries are impacted will reveal where the EU’s priorities really lie in terms of international cooperation.
As AidWatch highlights, the misuse of ODA amid pressing global crises is of great concern.
While we understand that new approaches should be tried and we acknowledge the potential of the Global Gateway if it had a people-centred focus aimed at reducing inequalities, we have concerns about the current direction. The Briefing Book raises serious issues and undermines international cooperation, potentially reversing years of progress. It’s important to note that the Global Gateway, while significant for the EU’s economic security strategy, is not a comprehensive answer from the EU to the multifaceted challenges faced by partner countries.
The brief is silent on the impact of inequality, power relations and undemocratic trends on current world events and insecurity.
“While AidWatch has scrutinised ODA quantity and quality for nearly 20 years, it has always been up to the EU and EU Member States to reverse these trends. The upcoming 2025 International Conference on Financing for Development offers a crucial opportunity for EU Member States to realign ODA with its intended quantity and purpose, rather than advancing domestic agendas. It’s also an opportunity for the EU to truly support partner countries.”
Tanya Cox
Director, CONCORD
For media inquiries, please contact:
Camilla Falsetti, Communication and Media Adviser at camilla.falsetti@concordeurope.org
Lur Fernandez Salinas, Policy and Advocacy Adviser at lur.fernandez-salinas@concordeurope.org