New aid data highlights ongoing global challenges

New aid data for 2023 from the Organisation for Economic Co-operation and Development (OECD) shows that while official development assistance (ODA) rose to record levels for a fifth consecutive year, support is falling far short of need.

Yesterday, the OECD published preliminary data on ODA provided by members of its Development Assistance Committee (DAC), comprised of major global aid donors. While ODA rose by 1.8% to an all-time high of US$223.7 billion, this was largely in response to the war in Ukraine and other crises, the cost of supporting refugees in donor countries, and the ongoing economic impacts of the Covid-19 pandemic amid a slow global recovery.

While some donors increased aid spending to help meet high demand, others reduced it or spent large proportions domestically, reflecting a continued diversion of resources from poverty reduction efforts overseas.

Only five countries exceeded the 0.7% GNI target for ODA set by the UN General Assembly in 1970: Norway (1.09%, largely due to recent increases in humanitarian assistance, including to Ukraine), Luxembourg (0.99%), Sweden (0.91%), Germany (0.79%) and Denmark (0.74%). On average, DAC members only reached 0.37% GNI. The US, Japan and the UK recorded the largest increases in absolute terms.

ODA as % of GNI by donor: a mixed picture

Source: OECD DAC

The amount spent supporting refugees within donor countries fell 6.2% on average, but still accounted for more than double 2021 levels and for 14% of total ODA in 2023. In-donor refugee costs also accounted for more than a quarter of ODA in seven countries. This includes the UK , the fifth-largest DAC donor, largely been driven by spiralling emergency accommodation costs . Across all DAC members on average, almost as much aid was spent on this (US$31 billion) as on bilateral aid to sub-Saharan Africa (US$32 billion), or the UN’s list of Least Developed Countries (LDCs) (US$33 billion).

The ongoing impact of the war in Ukraine raises similar concerns, following the trend since the start of the conflict. ODA to Ukraine rose a further 9% in 2023 to US$20 billion, 9% of total net ODA and the most that any country has received in a single year. Globally, humanitarian assistance rose by nearly 5%, but continued to fall far short of need. This trend is likely to continue as many other crises continued to escalate, with nearly 300 million people requiring humanitarian assistance in 2024.

Aid reached an all-time high of US$224 billion in 2023 and support to Ukraine increased to record levels

Source: OECD DAC. Notes: The overall total figure is presented in grant equivalents. 2023 data is preliminary.

Meanwhile, much-needed ODA to LDCs and sub-Saharan Africa, where most extreme poverty is concentrated, increased slightly, returning to growth after a fall in 2022, but remained below 2021 levels. Worryingly, over the last decade, ODA to LDCs has grown by a mere 5.9% (US$1.8 billion) while overall aid has grown by 60% (US$84 billion). Many low- and lower-middle-income countries continue to struggle with rising debt and reduced capacity to respond to global shocks, highlighting the impact of global inequality , while the funding gap to achieve the Sustainable Development Goals by 2030 has grown to a staggering US$4 trillion .

ODA to LDCs increased slightly but remained below 2021 levels

Source: OECD DAC. Notes: LDC ODA data for Germany is not available in 2023, we use an estimate for Germany’s figure based on applying the 2022 to 2023 percent change in overall ODA to Germany’s 2022 aid to LDCs.

While DAC members point to aggregate historic high levels of aid as evidence that they are stepping up to the plate, it is clear that much more needs to be done to ensure these increases are benefiting people living in poverty.

---

Read more blogs and resources on ODA from Development Initiatives.

Contact: Tim Molyneux, Head of Communications & Influence

Lead analyst: Duncan Knox, Senior Analyst

Total trends here are presented in grant-equivalent figures the grant equivalent is an estimate, at today's value of money, of how much is being given away over the life of a financial transaction, compared with a transaction at market terms. We quote the real term increase in total ODA as 1.8% for consistency with the OECD’s detailed summary note on ODA in 2023, however, this is based on constant 2022 figures; our trends data is in constant 2023 prices and records a 1.3% increase in overall ODA.

The data shown in this publication was downloaded directly after release on 11 April 2024.