2021 - AidWatch Reports

PANDEMIC PUTS ODA BUDGETS UNDER PRESSURE

There has always been pressure on EU donor governments to prioritise domestic spending at the expense of development assistance. Cynical commentators tell voters that aid money is wasted on ineffectual projects and could be better spent fighting poverty at home.[1] With the fallout from the pandemic increasing hardship everywhere, calls to put the needs of domestic populations first have become louder still, and some governments are beginning to listen.

Five EU member states (Czech Rep, Greece, Ireland, Lithuania, Luxembourg) decreased ODA funding by over 5% from 2019 levels. Another worrisome example comes from the UK, which decreased its ODA substantially before leaving the EU in March of 2020. After Brexit, further cuts, from 0.7 to 0.5 per cent, were announced. The UK’s Chancellor of the Exchequer commented: “During a domestic fiscal emergency, when we need to prioritize our limited resources on jobs and public services, sticking rigidly to spending 0.7% of our national income on overseas aid is difficult to justify to the British people.”[2] This rationale for reneging on the 0.7% commitment deliberately ignores the fact that expressing the target as a percentage of GNI is specifically designed to allow for fluctuations in domestic economies – and demonstrates how egregious these cuts are. Other European non-EU members, such as Norway and Switzerland, demonstrated much stronger commitment to international cooperation and increased their ODA by almost a tenth each in 2020, to 1.11% and 0.48% of GNI respectively.[3]

Public opinion across Europe has actually remained in favour of the EU’s stance on development assistance, even after the onset of the pandemic. The 2021 Eurobarometer survey showed that almost nine in ten respondents think it is important to partner with countries outside the EU to reduce poverty around the world (88%).[4] Despite mounting domestic pressure, several EU Member States have responded to the challenges of 2020, increasing their ODA spending in real terms. Germany, increasing its ODA by 14% from 2019 levels, has met the 0.7% GNI target for the first time since 2016. France, meanwhile, has passed a bill committing the government to striving to spend 0.7% of gross national income on official development assistance by 2025. However, critics have pointed out that this bill does not actually require the government to hit the target, but only to strive to do so,[5] and various civil society representatives have said that the final bill is likely to be less binding than originally suggested.

Rather than providing a rationale for reducing development assistance, the pandemic has increased the need for it. In over two decades, 2020 was the first year in which the global poverty rate increased, and it is forecast that over 140 million more people will be pushed into extreme poverty by the end of 2021.[6] This is a catastrophic outcome. The UN Secretary-General, António Guterres, has called for high-income countries to respond, saying, “Poverty is rising. Human development indicators are declining. We are careening off-track in achieving the Sustainable Development Goals … We need a collective commitment to avoid a downward spiral.”

Sadly, few Member States appear likely to meet ODA spending targets in the next few years. The governments of those countries that have reached the target mostly view aid as a way to enhance their influence on the international stage (e.g. the UK), or have demonstrated a long-term commitment to humanitarian and aid principles that the electorate broadly supports (e.g. Sweden and Denmark).[2] In the case of Sweden, successive governments have committed to high ODA spending. Possible contributing factors may be Sweden´s strong tradition of multilateral involvement, strong public support for international aid and a fairly solid consensus in parliament about the benefits of consistent development and foreign policies based on fundamental values, which unite their democratic political parties. That said, two opposition parties have recently been promoting cuts in ODA and a more Sweden-centred approach to international cooperation.

For most governments in the EU, ODA is not viewed as a political priority and public interest in the issue is low. ODA cuts therefore represent a seemingly easy way to make fiscal savings without risking voter support. Without greater public awareness of sustainable development emergencies, governments are unlikely to alter policy in the short to medium term. Civil society therefore has an important role to play, not just by continuing to lobby governments directly, but also by engaging proactively with the public.

Shifting the goalposts – new rules on debt relief drive ODA inflation

In July 2020, the DAC approved new rules for how it will record debt relief as ODA, sparking widespread concern that donor countries will be encouraged to rely more and more on inflated ODA through the increased use of loans. The main change is to how debt relief on ODA-eligible loans will be counted. The DAC argued that this was necessitated by the 2018 change to measuring ODA loans on a grant-equivalent basis. For ODA loans, the rules essentially state that donors should record the grant equivalent of the amount cancelled.

However, there are concerns that this double-counts the donor effort involved in lending, something acknowledged in a previous DAC background paper. Previously, loans were measured on a flow basis: disbursement counted as ODA, and repayments counted as negative ODA. Fully repaid loans eventually netted to zero, so the eventual ODA scored on loans was (roughly) equal to the losses on those loans. Now, the ‘grant element’ of loans is recorded: this is essentially an estimate of what those losses will be. For riskier lending categories, the lender expects to lose more capital, and so more ODA is recorded (i.e. the grant element of loans is higher, controlled by the discount rate). But this means that counting additional ODA when debt cancellation occurs is adding actual losses to an estimate of those same losses. This was previously acknowledged by the DAC, but is nevertheless now allowed by the new rules. Moreover, the discount rates used to measure the grant element of loans are considered already higher than warranted by the risk of lending, further inflating ODA.

To compare the likely impact of the new rules on ODA figures relative to the old rules, in the reporting of debt relief on ODA loans, the chart below simulates thousands of debt relief scenarios based on the average terms reported in the Creditor Report System (CRS) database, and shows how much ODA would be recorded under old and new rules, as a percentage of the face value of the loan. Points on the 45-degree line are cases where, over the course of the cancelled loan, total recorded ODA would be the same under both the new and old rules. The points on the left are those where higher ODA is recorded under new rules. In the vast majority of cases, the new rules record substantially more ODA than the old rules for the same loans, suggesting that the new rules on debt relief – in conjunction with the grant-equivalent measurement system – will further inflate ODA (notwithstanding a ‘safeguard’ introduced by the DAC: that the total value of ODA recorded on a loan must never exceeds the face value).

The new rules could encourage donors to use loans rather than grant modalities, and to reschedule rather than cancel debt, while still hitting ODA spending targets. In addition, the new rules have failed to solve the problems that were associated with the previous regulations, which had generated years of controversy. Cancelling debts on loans originally disbursed to fund non-development-related initiatives, such as arms procurement, can still be counted towards ODA, creating a risk of displacing legitimate development projects. Continued incoherence on this issue risks undermining the reputation of the DAC and could reduce confidence in ODA more broadly, potentially giving licence to donors to define ODA as they see fit.

Of EU Member States, France and Germany are expected to get the most significant boost to their reported ODA from the adoption of the new rules, and these two countries were indeed among the most vocal in calling for the change. Both countries already record an unusually high share of their ODA as loans rather than grants (21.3% for Germany and 46.1% for France in 2019), on which they accrued interest at a rate of 1.94% and 2.27% respectively. France is currently being predicted to meet (or very nearly meet) the 0.7% GNI ODA target in 2021 as a direct result of the rule changes, on paper making it the most generous donor in the G7. There is a real concern that other countries could follow suit and increase the use of loans rather than grant-based modalities, with serious consequences for development assistance across the EU and the world.

RESOURCES FOR FIGHTING COVID-19

In March 2020, as the pandemic began to take hold globally, the prime minister of Ethiopia wrote: “Momentary victory by a rich country in controlling the virus at a national level … may give a sense of accomplishment. But we all know this is a stopgap. Only global victory can bring this pandemic to an end.”[3] The EU recognised the importance of its role in this worldwide struggle early on, and swiftly mobilised ODA resources to tackle the pandemic globally. However, official sources differ about the amounts spent. The OECD reports that the EU institutions and Member States have spent approximately €12.4bn ODA on helping EU partner countries respond to the pandemic,[4] but the EU has consistently presented higher spending figures than this, often citing “over €40bn in support for partner countries”.[5] Official EU reporting has been very unclear about how much of its COVID-19 response package represents entirely new funding and what portion is reallocated from pre-existing ODA budgets that had been earmarked for other projects. This raises questions about long-agreed development priorities in partner countries being defunded to pay for COVID-19 response activities.

Despite the EU’s allocation of some additional funds to its pandemic response, this has been inadequate to meet the scale of the challenge. To put funding levels into context, total ODA in 2020 from Members of the DAC globally was US$161.2 billion, which is just 1% of the amount that high-income countries have spent on domestic economic stimulus measures in response to the pandemic.[1] Announcing the ODA figures for 2020, Ángel Gurría, Secretary-General of the OECD, underlined the urgent need to increase funding levels, saying, “The 60-year trendline shows the political will exists to maintain ODA. Now we need to leverage this to make the kind of investments that will produce a truly global recovery … This is precisely the moment to scale up ODA levels to match these demands.”[2]

CONCORD strongly believes that the 0.7% ODA/GNI target remains an important yardstick by which to judge EU Member States’ contributions towards international development goals, but assessing the quantity of ODA alone is not enough to make sure that the EU is contributing effectively to sustainable development objectives. As the pandemic and its consequences have shown, increasing flows of concessional financing in general – and not just ODA – are key to achieving sustainable development goals. Beyond this, EU donors must ensure the quality of their interventions and allow civil society to play their vital scrutiny role that helps keep donors accountable. The next three sections of this report focus on how to make EU ODA more impactful, ensure no one is left behind, and achieve the systemic changes needed to reduce inequalities between and within countries.

Stakeholders’ first reactions to the launch of Team Europe

Team Europe seems to have landed relatively well inside the EU, with Member States responding “enthusiastically, even beyond [the Commission’s] hopes”. As well as the major donors, such as France and Germany, that are directly funding large numbers of TEIs, smaller donors, such as Hungary, view Team Europe as a chance to get more involved in planning EU ODA. A spokesperson for the Hungarian Ministry of Foreign Affairs said in a statement, “Hungary urges the Team Europe approach to be an inclusive process allowing smaller Member States to play an equal role in the implementation of the NDICI.” However, despite strong declarations of support for the overall approach, some Member States remain unclear on how they will be actively involved in Team Europe, or what it means in practice. The Belgian government, for example, while ostensibly involved in Team Europe and willing to identify opportunities for joint programming with other EU donors, is not currently mobilising additional funding for TEIs. Although joint programming is a main plank of the Team Europe approach, it is worth noting that the overwhelming majority of TEIs have been developed with the involvement of just a handful of EU Member States (Germany, France, the Netherlands and Spain being most heavily invested) – which puts a question mark over how representative Team Europe is of the bloc as a whole.

EU partner countries and CSOs are more sceptical about the need to rebrand EU aid and would rather see more focus on increasing ODA spending, and on impact. Paul Okumu, Head of Secretariat at the Africa Platform, described Team Europe as “a desperate EU attempt to recapture the [African] continent from [the influence of] China … There are already several EU initiatives that were all intended to do the same things that Team Europe is being set up to do. If you take a look at the many attempts that Europe has made to engage [with Africa], under either the OECD DAC or just on its own, you see a clear pattern. There is nothing new that Team Europe is going to do that the current [EU development assistance] structure is not able to do.” There is a wider perception that Team Europe represents a reaction to other geopolitical challenges facing the EU, including Brexit and growing rivalries with state actors such as Russia and China. Adrian Chikowore, Policy Analyst on International Public Finance (IPF) in the Africa-focused lobbying organisation, AFRODAD, describes Team Europe as “an initiative trying to demonstrate the EU’s unity, a show of strength in the face of emerging economic powerhouses, particularly China”.

If you take a look at the many attempts that Europe has made to engage [with Africa], under either the OECD DAC or just on its own, you see a clear pattern. There is nothing new that Team Europe is going to do that the current [EU development assistance] structure is not able to do.

Beyond Africa, possible partnerships with Team Europe are viewed more positively: in South-East Asia, in particular, the EU is often seen as a more reliable and less coercive donor than either the United States or China. Mark Moreno Pascual, Global Coordinator of the Reality of Aid Network, said: “Civil society generally sees the EU as an alternative to US funding, providing ODA with less conditionality, more transparency and accountability and a greater focus on results.”However, given that less than half as many TEIs are currently being planned there, Team Europe currently has a lower profile in Asia than it does in many African countries.

Some of the negative reactions from civil society may be due to the EU’s failure to engage meaningfully on Team Europe with CSOs. This lack of engagement is reflected in almost total lack of consultation on TEIs programming and the extremely limited funding Team Europe disbursed to local NGOs and CSOs in partner countries through the EU’s Global Response to COVID-19 – even though these organisations have been key actors at the frontline of the pandemic, working with the most marginalised people and communities, in vital sectors such as health and education.

Effectiveness of the Team Europe approach

The EU has committed to the following four principles under the Busan Partnership for Effective Development Cooperation: (i) focus on results; (ii) ownership of development priorities by partner countries; (iii) transparency and mutual accountability; and (iv) inclusive partnerships. CONCORD has conducted an initial analysis of the Team Europe approach against each of these principles, qualitatively assessing the level of commitment to each and assigning a rating of red (low level of commitment: urgent improvement required), amber (medium commitment: some adjustments to the approach needed) or green (strong commitment). As Team Europe is still in the early stages of its planning cycle, our analysis is largely limited to an assessment of intention. In future editions of this report, we expect to be able to provide a more comprehensive readout based on the delivery and impact of TEIs.

Only through an assessment of the delivery and impact of the TEIs can we really judge the effectiveness of the Team Europe approach, but there are currently worrying signs that it is falling short when measured against all four of the Effectiveness Principles. Partner country ownership seems nominal at best, while all aspects of Team Europe lack transparency, and civil society has so far been largely shut out of the process. Unless all these issues are addressed urgently, Team Europe will fail to deliver sustainable development and could actually hamper progress towards the SDGs.

Focus on results

Ostensibly, Team Europe is focused on “improving effectiveness and impact through greater coordination and coherence, by applying the development effectiveness principles and by delivering development cooperation as one part of the overall internal and external action to promote the implementation of the 2030 Agenda”.

Better collaboration between EU donors could indeed yield more positive outcomes for partner countries, by encouraging more coordination, better pooling of financial resources and increased knowledge sharing. However, mechanisms for joint programming did already exist, and were promoted strongly in the 2017 European Consensus on Development. The Council’s Conclusions on Team Europe, from April 2021, open with the statement that, “The Team Europe approach contributes to demonstrating EU global leadership, responsibility and solidarity,” prioritising this ahead of any commitments to bring about systemic changes for sustainable development in partner countries. The Council goes on to “[call] upon all Members of Team Europe to increase the visibility of their joint engagement as Team Europe in a strategic manner”, which lends further credence to the argument that Team Europe is intended first and foremost as a communications initiative.

The communications benefits of Team Europe should not be seen as more important than delivering effective results for sustainable development. It is felt in many partner countries that, although EU ODA is vital to achieving sustainable development goals, EU donors are primarily motivated by their own self-interest, which undermines effectiveness. Paul Okumu, of the Africa Platform, gave a clear example of this: “Despite Team Europe’s commitment to [supplying] vaccines to Africa as part of its COVAX COVID response package, it is the same EU that is bitterly fighting any attempt by developing countries to access the patents necessary [for developing] vaccines independently.”

Ownership of development priorities by partner countries

The European Commission’s guidance for Team Europe shows a strong commitment to the principle of partner-country ownership, explicitly stating that “Partner country engagement, appropriation and ownership are essential … Joint programming should be led by the partner country’s development strategy and aligned to the partner country’s sustainable development priorities.”[4] With limited public information currently available, it is difficult to verify how many TEIs have been aligned with partners’ national development strategies, but DG INTPA has issued instructions that EU Delegations (EUDs) are responsible for ensuring that this is done.[5] Nevertheless, there will clearly be questions about the inclusiveness of an initiative that is structured around the EU’s own 5 priorities for external action – rather than shared ones. As discussed in reference to the principle of inclusive partnerships, consultation with CSOs in partner countries has been generally limited, further calling into question the ownership of TEIs.

Transparency and mutual accountability

So far, there has been limited publicly available information about the remit, governance and funding of Team Europe and about the planning process for TEIs. The European Commission has said that the design, financing and implementation of TEIs are open to all Members of Team Europe, who are invited to make the best possible use of European expertise and resources. How this works in practice is unclear, as the TEIs have so far been developed behind closed doors, allowing no opportunity for public scrutiny. Certainly, CSOs have not systematically been consulted on how Team Europe works as a whole. In the cases of some particular TEIs, EUDs have involved CSOs at the pre-programming stage – but often without making them aware that that was the moment for them to contribute to the overall development of the TEI programme more widely. CSOs have largely been denied the opportunity to comment until after political decisions about the location and objectives of initiatives have been made.This has prevented important stakeholders within Member States from giving their input on what may turn out to be a significant shift in how their government plans and delivers ODA.

As Team Europe matures and its purview extends beyond the immediate pandemic response, it must adopt more participatory and inclusive planning and evaluation approaches and become more transparent in its reporting, in line with the standards of the OECD Creditor Reporting System (CRS), the International Aid Transparency Initiative (IATI), the EU Aid Explorer, and the five working principles of the human rights-based approach (HRBA), which include meaningful and inclusive participation by the people concerned and access to decision making.

The European Commission has committed to improving transparency around Team Europe and has begun to update the joint programming tracker, aiming to provide easily accessible, up-to-date information on the TEIs. The existing joint programming tracker does provide information about the EU Member States’ and the European Commission’s joint ODA initiatives, but it can be difficult to access detailed information on particular initiatives in partner countries. Moreover, accessing information on decisions already taken is only a small part of transparency and accountability. It is therefore important for the updated tracker to be more user-friendly and more accessible to local CSOs. In the recommendations section, a number of more specific requirements are set out in this regard.

The Commission is also developing, together with the Estonian Ministry of Foreign Affairs, a second online tool, the Team Europe Partnership Portal. This is intended to allow all stakeholders, including Member State and partner country governments and civil society, to access up-to-date information about sustainable development needs in partner countries and to coordinate the development of new TEIs.If such a tool can be successfully developed it could set a new standard for transparency and inclusiveness in the joint planning of ODA.

Inclusive partnerships

Globally, we are seeing a shift away from traditional development cooperation towards international partnerships that aim to “build more equal relationships” between donors and partner countries. At the EU level this was reflected, in January 2021, in the changing of the name of the European Commission’s DG International Cooperation and Development (DEVCO) to DG International Partnerships (INTPA). The emphasis placed on partnerships in the Commission’s guidance for Team Europe suggests at least some commitment to this new approach. So far, unfortunately, it is not clear that this has been carried over into the design and implementation of TEIs.

Consulting with the relevant stakeholders, including civil society, in partner countries is important to ensure that projects respond to the needs of different groups and maximise impact. Civil society should engage widely, consulting and working with organisations representing local communities in rural and urban areas, indigenous people, people with disabilities, women and youth. However, an early analysis of the TEIs so far agreed shows that there is considerable room for improvement.Moreover, although civil society is sporadically being included in the implementation of TEIs, CSOs have not been engaged systemically or meaningfully in the TEI planning process, which has taken place privately between EU institutions, Member States and the EU financial institutions. The European Commission recognises the need to do better in this area, commenting that engagement with civil society “risks becoming rather ad hoc, while experience has shown that an effective dialogue needs to be more structured and regular”.

Some EU Delegations already do engage well with civil society: in preparing the first TEIs to be developed in Côte d’Ivoire, for example, the EUD held consultations with national and local CSO networks. This allowed civil society to submit some recommendations, ensuring local priorities were taken into account in the project design.Despite positive examples such as this, however, the European Commission generally relies on the Policy Forum on Development (PFD) as its principal mechanism for engaging with civil society and local authorities including from partner countries. The PFD organises a series of structured dialogues, which could be a useful way for donors to engage with CSOs and local authorities – but up until now it has been used largely to communicate information in one direction only, rather than to carry out meaningful consultation and promote truly inclusive partnerships.

Overall effectiveness of Team Europe

Only through an assessment of the delivery and impact of the TEIs can we really judge the effectiveness of the Team Europe approach, but there are currently worrying signs that it is falling short when measured against all four of the Effectiveness Principles. Partner country ownership seems nominal at best, while all aspects of Team Europe lack transparency, and civil society has so far been largely shut out of the process. Unless all these issues are addressed urgently, Team Europe will fail to deliver sustainable development and could actually hamper progress towards the SDGs.

EU ODA to Least Developed Countries

In 2010, the EU, together with its Member States, committed to spending at least 0.15-0.20% of their GNI on ODA to the least developed countries (LDCs) by 2030. In 2019, EU ODA to LDCs was only €13.9bn (0.10% of GNI), a decrease of €6bn in real terms since 2018 and a fall of 0.025% of GNI. Individually, only three Member States (Luxembourg, Sweden and Denmark) reached the target.

It is clear that not enough EU ODA is being deployed where it is most needed. In 2019, out of the world’s 46 LDCs, only Afghanistan and Ethiopia were among the top ten recipients of EU collective ODA. The recipient of the largest amount of EU ODA in 2019 was Turkey, which received €2.06bn (€0.42bn more than the recipient of the next largest amount, Syria), despite being classified as an ‘upper-middle-income country’.

In January 2022, the Fifth UN Conference on the Least Developed Countries is scheduled to take place, as the previous plan for LDCs, the Istanbul Programme of Action (IPoA), expires. The conference is intended to “undertake a comprehensive appraisal of the implementation of the IPoA, mobilise additional international support measures and action in favour of LDCs, and agree on a renewed partnership between LDCs and their international cooperation partners to overcome structural challenges, eradicate poverty, achieve internationally agreed sustainable development goals and enable graduation from the LDC category”. This is likely to be the final opportunity to adjust the global approach to sustainable development in LDCs before the 2030 SDG deadline and the EU, being the biggest bloc of donors, has an important part to play in shaping the agenda.

EU ODA aimed at supporting gender equality

A person’s gender is perhaps “the most persistent predictor of poverty and powerlessness” and gender inequalities are a powerful driver of all other inequalities. Reducing gender inequality is therefore a key factor in reducing poverty and the most important consideration when ensuring that no one is left behind. This is a huge challenge. Over the past year, COVID-19 has deepened gender inequalities, hitting women and girls hardest. As explained by UN Women, “Across every sphere, from health to the economy, security to social protection, the impacts of COVID-19 are exacerbated for women and girls…” Of course, a wide range of other factors, such as race, social class, sexuality, disability and immigrant status also intersect with gender, increasing inequalities still further for huge numbers of women and girls. Now more than ever, EU ODA must focus on increasing gender equality to build a post-pandemic world that is not only fairer, but also more resilient to future crises. Unless these inequalities are addressed, women’s ability to contribute to the recovery process will be impaired and will negatively impact everyone’s future. The EU recognises the key role played by gender equality in achieving the Sustainable Development Goals, as underlined by the High Representative of the Union for Foreign Affairs and Security Policy, Josep Borrell, when he said, “The participation and leadership of women and girls is essential for democracy, justice, peace, security, prosperity and a greener planet.”

Despite the value the EU places on gender equality, in 2019 only 5.56% of EU ODA had this as its principal objective (down from 5.61% in 2018) and only 48% had gender equality as either the principal or a significant objective. Closer analysis of individual ODA initiatives suggests that many of those that do include gender as a significant objective do not achieve a meaningful impact. A 2020 Oxfam report on the effectiveness of gender equality projects, including EU-funded initiatives, found that, “Only about 20 per cent of the projects examined identified or addressed unintended negative consequences, potentially putting women and girls at increased risk of experiencing gender-based violence, increasing gender gaps, or many other unintended consequences. Women’s participation and leadership were also seldom addressed, and gender-disaggregated data and gender equality objectives and indicators were only found in about 50 per cent of the projects examined. On average, only 39 per cent of the components identified as being necessary for gender equality projects were included”. The European Commission and EU Member States must ensure that project designers do not just pay lip service to gender equality principles, but that they are mainstreamed throughout the vast majority of ODA. Nevertheless, as the new gender equality plan for EU foreign policy, titled Gender Action Plan III (GAP III), acknowledges, gender mainstreaming throughout EU ODA requires a gender-transformative approach, to create meaningful changes that will lead towards gender equality.

The positions of certain Member States on gender issues – notably Poland and Hungary, which have recently instituted policies designed to restrict the rights of women and LGBTQ people in their own countries – are becoming increasingly dangerous. In 2020, both of these countries, along with Bulgaria, fiercely opposed some elements of the new GAP III. Polish State Secretary for Development Cooperation, Paweł Jabłoński, said, “The Treaty of the European Union very clearly refers not to gender equality but to equality between women and men… We see no need to redefine that and we do not appreciate attempts to do so. We should follow legal norms instead of inventing new ones.”

The EU has long embraced the term gender equality and its definition of gender is broad and encompasses a range of identities, not just a binary male-female split. It is crucial that the EU continues to support this broad interpretation of gender to ensure that minority groups are protected from discrimination. By preventing the European Council from adopting Council Conclusions, Poland, Hungary and Bulgaria threaten the EU’s legitimacy as a global leader on gender issues, which in turn is likely to translate into weakened efforts to address inequalities affecting women and girls, in all their diversity, in partner countries.

The EU frames GAP III as “an ambitious agenda for gender equality and women’s empowerment in EU external action” and it sets out a clear plan to tackle the root causes of gender inequalities. While GAP II has been a good example which shows the positive potential of including gender equality in EU programming and policy dialogues, GAP III now needs to secure further achievements. If it is to succeed, the EU and Member States need to ensure that the appropriate funding is made available for implementation. Much of this funding is allocated at the Member State embassy and EU Delegation level, and so will require a strong commitment from individual Member States. However, in the EU GAP III two targets are established: 85% of new programmes should aim to gender as a significant and principal objective and 5% of new programmes to gender as principal objective. These two targets relate to the share of new programmes, and thus have nothing to do with funding or share of EU ODA. To ensure appropriate resourcing, it is important that the EU adopts specific gender funding targets. Now that GAPIII is already adopted, such funding targets can only be anchored in the next GAP. CONCORD suggests, for the future EU GAP, a spending funding target of 85% of EU ODA to be earmarked to gender as principal and significant objective and 20% of EU ODA to be earmarked for projects directly addressing the root causes of gender inequalities and having gender equality as a principal objective.

When properly funded, EU ODA can be highly successful in reducing gender inequality, as illustrated in the case of Mozambique, which rose 24 places in the World Economic Forum’s Global Gender Gap Index in 2020. Successful projects here included the joint EU-UN Spotlight Initiative to end violence and harmful practices against women and girls, which:

improved the legislative framework in Mozambique, with four laws protecting women and girls passed in late 2019;
strengthened the capacities of service providers, including ‘integrated assistance centre’ staff and workers in the health, police and justice sectors, with a focus on essential services for victims of violence; and
mentored over 32,940 adolescent girls on their sexual and reproductive health and rights (SRHR), child marriage, self-esteem and life skills.

EU ODA financing to support CSOs

Civil society plays a vital role in ensuring ODA remains focused on reducing inequalities and represents the full spectrum of a country’s population. CSOs have the “capacity to reach out to, empower, represent and defend marginalised and socially excluded groups, and trigger social innovation”. Only by working with CSOs can ODA projects reach those people in society who are most in need, and truly leave no one behind.

Over recent years, meaningful engagement with civil society has become more difficult, owing to increasing repression in many developing countries and the erosion of civil liberties. In its 2020 report, Freedom House, the human rights watchdog, noted “that 2019 was the 14th consecutive year of decline in global freedom”. This negative trend has been further accelerated by the pandemic, with political leaders “rolling out well-rehearsed routines of repression. States took on broad emergency powers and at least some clearly used the pandemic as a pretext to introduce rights’ restrictions that will last long after the crisis has passed”. CIVICUS, a global alliance for civil society, assessed that in 2020, 87.3% of people around the world lived in countries with an obstructed, repressed or closed civic space – a marked increase from the 82.4% who did so in 2019.

Overall, in 2019 the EU disbursed a total of €7.5bn to or through CSOs, representing 12.9% of all bilateral EU ODA (from either Member States or EU institutions). This is slightly up on CSO funding in 2018 (12.0%),but it does not represent an adequate response to the shrinking civic space, nor does it reflect the vital role that CSOs play in development and international cooperation. In fact, only 1.8% of all EU ODA to CSOs is core funding to organisations in partner countries, to those groups that are in most desperate need of support. The EU and Member States should address this as a matter of urgency.

Moreover, adequate EU financial support to CSOs must come with a structured and meaningful policy dialogue between EUDs, civil society, the private sector and partner governments. The EU must actively support and promote an inclusive and independent civil society, and must highlight the importance of freedom of association, assembly and expression as human rights. In addition, it should structure financial support for CSOs as development actors in their own right, and should invest in civil society leadership. The vast majority of EU ODA disbursed to CSOs comes in earmarked funds, which must be spent on specific projects initiated by the donor. Only 20.3% is core funding, which comes with political recognition by donors, provides resources that allow flexibility in terms of policy priorities and activities, and strengthens CSOs’ organisational capacity – something that is particularly important for defending civic space.

In addition to supporting CSOs directly, the EU must consider the role that ODA delivered through budget support can play in sustaining repressive governments and ensure that it does not inadvertently contribute to a hostile environment for civil society. For example, since President Duterte took office in the Philippines in 2016, his administration has conducted a sustained campaign of terror, with the security forces carrying out thousands of extrajudicial killings of left-wing political activists, environmental activists, community leaders, indigenous peoples’ leaders, journalists, lawyers, and others.In this same period, the EU has been one of the Philippines’ most notable development partners, disbursing ODA worth millions of euros. Mark Moreno Pascual, from the Reality of Aid Network, called on the EU to review its ODA policy towards repressive regimes and ensure it is aligned with human rights principles. In his words, “ODA should not be allowed to be misused to aid repression. If this cannot be guaranteed, the EU should consider alternative mechanisms to budget support, such as the GSP+, to achieve sustainable development objectives.” In those countries where civil society is under pressure, the EU should support CSOs directly wherever possible, capitalising on existing mechanisms, such as the European Instrument for Democracy and Human Rights, or ProtectDefenders.eu,which provide support for individuals and CSOs under direct threat in partner countries. Equally importantly, the EU should provide long-term, flexible, context-appropriate support for democratic processes and CSOs in partner countries.

EU ODA to help partner countries mobilise domestic resources

Domestic resource mobilisation (DRM) is key to securing long-term sustainable democratic financing and enabling countries to reach the Sustainable Development Goals. DRM efforts are largely focused on reforming tax systems within partner countries, to provide governments with sustainable revenues so that they can provide quality public services and ensure human development, among other things. It has proven difficult to evaluate the effectiveness of ODA in mobilising domestic resources, however, largely because initiatives often focus on technical assistance to build capacity and promote knowledge sharing, which can be hard to measure. What is clear is that in many partner countries tax revenues are generally stagnant or falling. General government revenue as a percentage of gross domestic product (GDP) in middle-income and low-income countries did not increase between 2010 and 2020. So clearly, more needs to be done to mobilise domestic resources effectively.

Although measuring the success of individual DRM initiatives can be difficult, particularly in the short term, there is substantial evidence to show that long-term commitment by international donors can have a transformative impact on partner countries. In Rwanda, for example, in the more than 25 years since the 1994 conflict, multiple donors, including EU Member States, have supported a wide range of tax reform projects. Cumulatively, this work helped achieve a roughly 50% rise in tax revenues as a share of GDP between 2001 and 2013. This in turn increased the resources available for development, allowing the Rwandan government to increase its spending on health from 3.2% GDP to 6.5% between 2008 and 2013. In choosing health, the government has contributed to increasing people’s standard of living, well-being and in turn supported plenty of other human development factors (eg. education, longevity…).

The EU and Member States have so far allocated very little ODA for DRM, with only Luxembourg reporting over 0.5% of its total bilateral ODA for this purpose. The majority of Member States do not spend even 0.1% of bilateral ODA on supporting DRM. It is unclear whether these figures are artificially low because of underreporting when following a relatively new DAC code (it was only set up in 2014), but given the lack of success with DRM thus far, CONCORD recommends significantly increasing ODA allocations in this area. Many EU countries have signed up to the Addis Tax Initiative, and have thus pledged to double their DRM work between 2015 and 2020. While this is welcome, it is equally important to ensure that tax reforms support progressive taxation, to ensure that DRM does not inadvertently increase inequalities in partner countries.

Current global tax rules are unfair, and the EU with its Member States have a responsibility both to help change these rules and to reverse their own practices, so that partner governments can collect the taxes that should be paid to them, rather than losing revenue through tax avoidance. Beyond initiatives in individual partner countries, CONCORD strongly supports efforts to set a global minimum corporate tax rate and recognises, although richer countries have to do much more, recent efforts in this area, which have seen 130 countries and jurisdictions sign up to a minimum rate. It is important that so many countries have come together to update rules that have prevailed for more than a century, but the reform deal contains a number of shortcomings. There is a risk that it will exacerbate the existing inequalities built into our international tax system: the agreed rate stands at a mere 15%, which is far too low, so the deal could serve to normalise tax rates at a level associated with tax havens. Finally, the mechanism for redistributing extra tax revenue favours rich countries. So, while we do see some limited progress, huge loopholes remain, and countries must do far better.

Austria

MAIN CHANGES IN 2020

With the new government programme (January 2020), the newly elected coalition made some of its promised improvements to Austria’s development cooperation. The Foreign Disaster Relief Fund was expanded from €15 million in 2019 to €50m in 2020, and it was announced that by 2025 it would be further increased to €60m. The bilateral funds for the Austrian Development Agency were also augmented, by €12m, and now represent 10% of total ODA. Still, these additional funds marked no real change in the ODA quota, as Austria spent 0.29% of GNI on ODA in 2020 – only a marginal increase from 0.28% in 2019. Austria is still far from reaching the target of 0.7% ODA/GNI. In 2020, 60% of its ODA (€646 million) was allocated to multilateral cooperation, while 40% (€481 million) was spent on bilateral cooperation.

The poorest countries, including those in Africa, which needed additional funds for fighting the COVID-19 pandemic and its social and economic consequences, generally saw their funding minimally increased, or even cut. A marginal 4% of total ODA (€43 million) was allocated to LDCs, representing a drop from 5% in 2019: we consider that this should be reversed in the future.

According to official OECD DAC statistics, Austria reported only €25 million on COVID-19 pandemic relief, although the government announced increased spending in 2021 on vaccine programmes for third countries.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Allocate additional bilateral funding for COVID-19 pandemic relief, for strengthening health systems and services and for allocating vaccines to the worst-affected countries in the Global South.

N

Implement the OECD DAC Peer Review recommendations and introduce an overall strategy for Austria’s development cooperation, a step-by- step plan for achieving the 0.7% ODA/GNI target and a strategy for policy coherence for sustainable development.

N

Increase bilateral funding for the poorest and most marginalised people, mainly in LDCs and sub- Saharan Africa, to eradicate poverty, reduce social and economic inequalities, strengthen gender equality and support civil society organisations in partner countries.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

Belgium

MAIN CHANGES IN 2020

Belgium can be commended for increasing its official development assistance (ODA) in 2020, both in real terms and as a percentage of GNI. 1 Belgian ODA rose from €1.97bn in 2019 to €2.01bn in 2020, an increase from 0.42% to 0.48% GNI. The increase in ODA as a percentage of GNI must be put into perspective, however, as it follows a 10% drop in GNI itself. Belgian ODA is still less than the European average.

Fortunately, since October 2020 the new government has officially committed itself to implementing a binding growth trajectory starting in 2021, to bring ODA to 0.7% of GNI by 2030. The new minister for development cooperation has also confirmed that ODA will be concentrated in LDCs and fragile states, with a particular emphasis on social protection and decent work. New trends have been identified in the areas of migration, agriculture and support for the private sector. Regarding agriculture, the new minister for development cooperation has clearly stated her willingness to support the transition to sustainable food systems by respecting agro-ecological practices, focusing on small-scale agriculture. To support the private sector, important criteria have been reiterated, such as access to social protection, respect for decent work, environmental and fiscal standards, and the need to exclude investment in the privatisation of public services such as education and health care. The new vision pays special attention to micro- and small enterprises, including smallholder farmers. Some private-sector support instruments introduced under the previous minister have not been renewed, while others are still merely encouraged. So a clarification of the private-sector support strategy seems necessary, to make it more coherent with the vision of the new minister.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase the funding for development cooperation in the 2022 federal budget.

N

Adopt a new law enshrining the binding growth trajectory, starting in 2021, so that Belgian ODA reaches 0.7% of GNI by 2030.

N

Clarify the strategy on support for the private sector and adapt private-sector financing instruments by giving priority to the local private sector, which creates decent jobs and respects social and environmental standards.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

Bulgaria

MAIN CHANGES IN 2020

In January 2021, the Council of Ministers adopted the new Mid-term Programme for Development Assistance and Humanitarian Aid 2020-2024. This builds upon and enriches the geographical and sectoral priorities of Bulgaria’s ODA and broadens the range of participants. New priority countries from sub-Saharan Africa have been added. The Programme acknowledges the need to prioritise activities relating to the effects of the pandemic. It also establishes a new Programme for Global Education and Awareness Raising (GEAR) to fund global education projects that raise awareness of development cooperation, sustainable development and the SDGs, human rights, tolerance, a culture of peace, and media literacy.

For the COVID response Bulgaria has provided over €1m for health care to support the most marginalised people in the Western Balkans, the Eastern Partnership countries, Syria, Iraq, Yemen and Afghanistan.

In 2020, Bulgaria’s ODA increased to 0.13% of GNI, with €62m reported as multilateral aid and almost €8m as bilateral aid.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

The government should further accelerate the process of developing a new law on development cooperation and should include a broad representation of stakeholders in the drafting process.

N

The new law on development cooperation should provide for the creation of a new Agency for Development Cooperation which will distribute bilateral ODA.

N

Specific regulations should be introduced to improve the involvement of CSOs in development cooperation programmes.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

CROATIA

MAIN CHANGES IN 2020

Croatia increased its ODA as a percentage of GNI from 0.12% to 0.15% during 2020 – a step forward in reaching the 0.33% target by 2030. Croatia is aiming to diversify its development cooperation toolbox, moving away from inter-institutional ODA towards technical assistance and other non-financial forms of support that encourage knowledge sharing. In its response to the COVID-19 pandemic, Croatia has supported its neighbouring countries in strengthening their health systems by providing medical supplies and financial contributions. Croatia has also contributed to the UN system, in particular the WHO, to accelerate the development of COVID-19 vaccines.

In 2020, the Croatian MFA announced a grant programme for funding CSO projects in development cooperation, which is a positive step in its partnership with civil society and a reflection of CROSOL’s recommendations in the AidWatch 2020 Report. This new tool aims to strengthen the cooperation between government and civil society, as well as improving Croatian CSOs’ capacity for participation in development cooperation projects. Because of the COVID-19 pandemic, however, the launch of the grant scheme was postponed until 2021.

The Croatian MFA’s report on ODA in 2019 was adopted by parliament in December 2020.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Step up efforts to increase aid, honour Croatia’s commitments to ODA financing and develop and adopt a concrete timetable for reaching ODA targets.

N

Improve reporting and increase transparency on Croatia’s ODA spending.

N

Continue improving its partnerships with CSOs.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

Czech Republic

MAIN CHANGES IN 2020

In 2020, Czechia disbursed €257m in ODA, down 6.9% from 2019. Figures for 2019, however, were inflated by some €2.2m in debt relief for Serbia and Montenegro. ODA as a share of GNI remained at 0.13%, where it has lingered since 2018.

The concentration of decision-making power within the Ministry of Foreign Affairs (MFA) was completed, while the capabilities of the Czech Development Agency (CZDA), responsible for implementing a significant portion of bilateral development cooperation, remained very basic. With the appointment of a new CZDA director, however, personnel and operations within the agency have begun to be stabilised. The trend of ODA cuts has continued in 2021, with the bilateral ODA budget down by 14% and humanitarian aid by 43%.

The MFA ́s efforts to kick-start the use of so-called ‘new instruments’ to engage national private-sector actors in development cooperation continued throughout 2020. This mainly involved the wider use of tied financial donations, after the pilot phase in 2019 (those from 2020 were formally labelled a humanitarian response to the COVID-19 pandemic), and a development cooperation guarantee instrument (which after two years of existence has failed to provide a single guarantee).

Very few of the recommendations made in the AidWatch 2020 Report were actually implemented, apart from improvements to the operational capabilities of CZDA.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase ODA budgets from 2022 onwards (in particular, bilateral ODA).

N

Intensify the focus on development effectiveness and impact in partner countries, and strengthen systematic monitoring and evaluation in line with the Leave No One Behind (LNOB) principles.

N

Ensure expertise and capacity are adequate to enable the Czech Development Agency and the entire Czech ODA system to operate effectively.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

DENMARK

MAIN CHANGES IN 2020

2020 was dominated by COVID-19, but it was also a period of preparation for 2021, which was predicted to be a year of change for Danish development cooperation. Although Denmark did not provide additional ODA for COVID-19 relief, around DKK 1bn was reallocated to pandemic response activities in the spring of 2020, including funding for CSOs.

The Danish social democratic government had a small reshuffle, which meant a new minister for development cooperation, Flemming Møller Mortensen, in the autumn of 2020. This will not have any major consequences for the government’s development cooperation priorities, which remain migration and climate. A look at the two annual finance bills since the government took office shows that these priorities have been reflected in the spending on ODA.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Do not impose conditionality on ODA based on returns.

N

Increase spending through and to civil society to 25% of ODA, to make Denmark a champion of civic space.

N

Ensure that Danish ODA is based on local needs and emphasises inclusion and local ownership;

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

Estonia

MAIN CHANGES IN 2020

There were some significant policy developments in 2020, some driven by the global pandemic, others being previously planned reforms. The Ministry of Foreign Affairs (MFA) started several major initiatives, such as developing a standardised impact assessment system for development projects, drafting a pilot Africa strategy (published in early 2021), initiating a change in development legislation and committing to establishing a new foundation, Estonia’s Development Cooperation Centre. In response to the global pandemic, a more impact-based approach to ODA programming was adopted in 2020.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Commit to increasing ODA budgets rapidly in orderto reach the set goal of 0.33% ODA/GNI by 2030.

N

Further develop the impact assessment system across all thematic priorities.

N

Develop an inter-ministerial joint programme for development cooperation by adopting a Policy Coherence for Sustainable Development approach in all foreign and development policies.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

FRANCE

MAIN CHANGES IN 2020

On 16 December 2020, during a week dedicated to international solidarity and humanitarian action, the government finally presented its Orientation and Planning for Solidarity, Development and the Fight Against Global Inequalities bill to the Council of Ministers. After several months of inaction, the government has now resumed work this new law, which will set out the new legal, budgetary and strategic framework for French policy on international cooperation and ODA.

In drafting the new law, the French government is demonstrating a real will to modernise its development work – a process the COVID-19 pandemic has forced it to accelerate. French ODA jumped by 24.3% between 2019 and 2020, and President Emmanuel Macron’s commitment to reach 0.55% of GNI by 2022 should be fulfilled in 2021.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase the ODA budget to reach, at long last, the 0.7% GNI/ODA target.

N

Guarantee an ambitious Financial Transaction Tax for international solidarity and climate by increasing its rate from 0.3% to 0.5% and allocating 100% of the revenue from this tax to ODA.

N

Improve the transparency and accountability of French ODA.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

FINLAND

MAIN CHANGES IN 2020

Finland made history in 2019 when Sanna Marin was appointed Prime Minister, making her the world’s youngest female state leader, and leader of the Finnish government coalition where all five parties are chaired by women. Advancing gender equality continued as the leading theme of Finnish development cooperation.

During its Presidency of the Council of the EU in the second half of 2019, Finland set out four priorities: common values and the rule of law as cornerstones of the EU, a competitive and socially inclusive EU, the EU as a global climate leader, and protecting the security of citizens comprehensively. The council adopted conclusions in December on the implementation of the UN’s 2030 Agenda.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Prepare a clear timeline with specific milestones for reaching the 0.7% ODA of GNI target by 2030.

N

Channel a minimum of 15% of all ODA to civil society organizations, to strengthen democratic governance systems, protect the shrinking civic space and reach out to the most marginalised communities.

N

Define specific climate funding criteria and qualitative/quantitative objectives, and channel income from the emissions trading scheme to development and climate financing.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

GERMANY

MAIN CHANGES IN 2020

In 2020, Germany’s ODA contributions increased thanks to significant additional spending (€1.5bn) in response to the COVID-19 pandemic. Furthermore, in 2020 Germany contributed around €500m to the World Health Organization for tackling the pandemic. Shrinking GNI was also partly the reason Germany’s ODA figure reached a historic high of 0.74% of GNI.

At the same time, however, the ‘BMZ 2030’ reform agenda of the Federal Ministry for Economic Cooperation and Development (BMZ) reduced the number of Germany’s partner countries, thus accentuating the geographical focus of German ODA on Africa and the Middle East. The reform process also meant that several Least Developed Countries (LDCs) were dropped from the list of partner countries. Despite promising to spend between 0.15% and 0.2% of GNI on LDCs (in line with the UN target), in 2019 Germany’s contribution stood at just 0.11%.

German development cooperation was subjected to the OECD’s DAC Peer Review in 2020. Key recommendations from this included the need for greater policy coherence and the development of a strategic vision for German development cooperation.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Focus development policies and strategies on the SDGs, on the principles of leaving no one behind and preventing further climate change.

N

Maintain ODA spending at the 2021 level in order to support the recovery from the pandemic and work towards achieving the SDGs.

N

Ensure that climate finance is new and additional to existing ODA spending, and double climate finance from €4bn euro in 2020 to €8bn annually by 2025.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

HUNGARY

MAIN CHANGES IN 2020

In 2020, the recent trend of steep increases in Hungarian ODA spending has continued. During the last three years the ODA/GNI ratio has almost tripled, expanding from 0.11% in 2017 to 0.27% in 2020. In real terms, the 2020 ODA budget of USD 411m represents a 36% increase from 2019, the largest among EU member states that year. Since 2010, Hungary’s ODA has grown by 260%. This remarkable trend surpasses the target of the country’s 2020-2025 development cooperation strategy (and the recommendation of Hungarian CSOs), which was to reach an ODA/GNI ratio of 0.25% by 2025. Multilateral ODA has grown by almost 40%, and bilateral ODA has increased by 25%.

Although this overall increase in ODA, and in particular its bilateral component, is welcomed, many questions remain about how this growing development contribution is spent. Inflated aid is a significant issue, and the biggest component of Hungarian ODA remains scholarships, which account for up to a quarter of the overall ODA and more than half of the bilateral ODA figures.

Hungarian policy/decision-making and implementation structures remain blurry. There is a humanitarian agency within the government, but it is not officially responsible for Hungary’s development cooperation portfolio even though no separate agency for development cooperation exists. CSOs are seriously concerned that the current fragmented arrangement, in which separate government institutions (with considerably different outlooks, goals, priorities and budgets) are responsible for humanitarian and development actions, may be significantly undermining development effectiveness. In this context, it is all the more important to put in place action plans that build on the broader national strategy and provide details of concrete interventions designed to achieve Hungary’s development objectives.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

To reach its objectives, and to react to new challenges like the COVID-19 pandemic, the new development cooperation strategy should be translated into concrete action plans.

N

Development cooperation deserves funds comparable to those provided for humanitarian assistance, and a separate development cooperation agency should be set up within government.

N

The government should urgently put the new monitoring and evaluation system in place, and start communicating its findings.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

IRELAND

MAIN CHANGES IN 2020

Following a general election in February 2020, a coalition government formed in June and its programme for government promised to put in place “a floor to ensure that the aid budget does not fall below the level of recent years in cash terms” and to make progress towards 0.7%.

Responding to the COVID-19 pandemic became a priority, and while no additional funding was provided, Ireland redirected over €140 million to the global COVID-19 response, 2 including by quadrupling its financial contribution to the WHO and supporting Gavi and the Global Fund, as well as working with EU partners on the COVAX initiative. 3 The government was also receptive to NGOs’ request for flexibility to allow them maintain their grant funding in the face of the pandemic.

Significantly, Ireland also succeeded in its election bid to join the United Nations Security Council for the 2021-2022 term. It took its seat in January 2021, setting out three key priorities: build peace, strengthen conflict prevention and ensure accountability.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase official development assistance to ensure Ireland keeps pace with global needs now and in the post-COVID environment. An increase of ODA in the budget for 2022 is therefore essential to set Ireland on a pathway to achieving 0.5% by 2025, and onwards to 0.7% by 2030.

N

Ensure additional and targeted financing for climate change mitigation and adaptation to support Least- Developed Countries (LDCs) and Small Island Developing States (SIDS).

N

Use Ireland’s voice at the UN Security Council, at the EU and in other international fora to champion human rights defenders and the role being played by civil society.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

ITALY

MAIN CHANGES IN 2020

In 2020, Italy was one of the first countries to be severely hit by the COVID-19 pandemic and to implement a nation-wide lockdown. Under these difficult conditions, the dialogue process continued between the Ministry of Foreign Affairs, the Italian Agency for Development Cooperation and national development CSOs. This was consistent with the sectoral legislation, Law 125/2014, and the findings from the 2019 DAC Peer Review, 1 which acknowledges Italy’s support for multi-stakeholder approaches. This made it possible, despite the challenges of the pandemic, to discuss several policies that were then officially adopted, including guidelines on Italy’s role in the global response to COVID-19, sectoral frameworks and the new policies on CSOs’ access to public funds, which paved the way for a new funding round in December 2020.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase ODA levels towards the internationally agreed commitments by endorsing a credible timeline to raise aid volumes from the current 0.22% to at least 0.30% by 2024; to avoid endorsing unrealistic projections, members of parliament should seek clarification on officially declared refugee costs.

N

Further implement multi-stakeholder approaches to development cooperation to bring more non- executive actors into decision making; fully implement the relevant provisions on transparency and participation introduced in the sectoral legislation, Law 125/2014.

N

Secure the comprehensive and inclusive implementation of the most recent DAC recommendations on enabling CSOs.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

LATVIA

MAIN CHANGES IN 2020

The Ministry of Foreign Affairs continued drafting new guidelines for the 2021-2027 development cooperation policy, focusing on new issues such as expanding the partner regions for bilateral aid, defining priority SDGs and emphasising the role of the private sector more.

The strengthening of the institutional framework for development cooperation policy implementation is underway – EU accreditation of the national development agency will increase the competitiveness of Latvian-led projects. Also, the introduction of three-year budget planning should improve the quality of development cooperation projects in the future.

Active cooperation with the OECD has started and workshops and recommendations have been delivered, in particular on role of the private sector in 2020.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

50% of open calls under bilateral aid must still be reserved for CSOs, as this is the main financing source for smaller local CSOs involved in development cooperation and building local resilience.

N

Specific support for Belarus must be continued, as the flexibility of bilateral aid ensures effectiveness.

N

The humanitarian aid system must be defined in more detail, as various global political, social and environmental crises require increasingly urgent responses.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

LITHUANIA

MAIN CHANGES IN 2020

Lithuania’s development cooperation policy reflects the national priorities of its foreign policy by focusing on the Eastern Partnership countries, in particular Moldova, Georgia and Ukraine. In response to the political developments in Belarus in September 2020, the Lithuanian government approved a plan to help the people of the neighbouring country. Lithuania’s support for democracy and human rights has caused tension with the Belarussian authorities.

In 2020, Lithuania’s ODA constituted about €63m (0.12% GNI), up from €60.4m in 2019. Lithuania is committed to increasing ODA to 0.33% of GNI by 2030. However, Lithuania’s bilateral assistance is in decline, amounting to only €10.44 million in 2020.
The key mechanism for implementing ODA is the Development Cooperation and Democracy Promotion Programme of the MFA. In 2020, the pandemic and the deteriorating political situation in Belarus negatively affected the implementation of projects.

Gender equality and the empowerment of women and girls in its partner countries are ongoing objectives of Lithuanian development cooperation. In 2020, eight gender equality projects were implemented in five countries.

The MFA admits declining public support for aid to developing countries: at the end of 2019, only 27% of Lithuanians believed that this should be a priority for the country’s government. In 2020, Lithuanian NGOs implemented four development education and information projects.

As a follow-up to discussions on changes in the legal framework for development cooperation, the MFA drafted the provisions for a Fund for Development Cooperation and Humanitarian Aid and submitted them for approval to the National Development Cooperation Commission. The chairman would be appointed by the minister for foreign affairs. Administration of the Fund would be handed over to the Central Project Management Agency, and the Fund’s council would include one representative of NGOs, appointed by the National NGO Council.

At EU level, during the negotiations on the new NDICI Lithuania initiated an agreement in principle, which will include essential provisions on compliance with nuclear safety standards in partner countries.

As an observer since 2013, Lithuania has further intensified its involvement in the OECD DAC.

During the negotiations on the Cotonou provisions and the EU’s relations with the African, Caribbean and Pacific (ACP) countries, Lithuania has consistently advocated that the new agreement should establish procedures for the smooth return and readmission of ACP nationals.

In 2020, Lithuanian public administration bodies were instructed to implement 13 new projects under the EU Twinning Programme. Since 2004, Lithuanian authorities have already participated in 119 twinning projects.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Boost the competence of the National Development Cooperation Commission and ensure a balance with the activities and competences of the Fund for Development Cooperation and Humanitarian Aid.

N

Draft a meaningful national project for engaging in development cooperation activities with African countries.

N

Report scholarships in Lithuania separately from aid flows.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

LUXEMBOURG

MAIN CHANGES IN 2020

The Luxembourgish government honoured its commitment to dedicate at least 1% of its GNI to ODA. Luxembourgish ODA reached 1.02% of GNI in 2020, and amounted to approximately €376m.

The ODA for 2020 is around 10.8 % lower than the previous year. This was due to a decrease in bilateral grants because COVID-19 prevented many projects from being implemented. However, the budget dedicated to NGOs and multilateral agencies increased slightly.

Luxembourg redirected some development cooperation funds that could not be spent as planned to support the COVID-19 response, mobilising €2-3m for each of its partner countries. Luxembourg NGOs were given the opportunity to restructure their projects and provide funds for their partners to help them fight the pandemic and its consequences.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Work closely with all stakeholders and development actors to identify indicators and tools to integrate the concept of leave no one behind and the human rights- based approach into all projects and programmes.

N

In the context of uncertainty and possible adaptations in budgets linked to the COVID-19 crisis, consult development cooperation actors and civil society before significant budget changes and ensure a principle of budget predictability.

N

Continue to foster communication and collaboration between ministries to enhance policy coherence for sustainable development.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

MALTA

MAIN CHANGES IN 2020

Malta is reporting 0.44% of ODA/GNI for 2022, an increase from the 0.30% reported in 2019. In real terms, this is a year-on-year increase of €14.48 million (€51 million for 2020). While this is the fourth consecutive year with a notable increase on the previous year, AidWatch Malta is concerned about the fact that reporting standards have fallen. The ODA report for 2019 published by the ministry includes less detail than the previous ones, which hampers attempts to analyse the Government’s performance.

The annual call for CSO projects was not issued for 2020, following a failed attempt in late 2019 to link CSO projects to trade promotion in Ghana and Ethiopia. The cabinet change in January 2020 brought in a new minister for foreign affairs, while the trade promotion portfolio was reallocated to the economy ministry. The global pandemic absorbed much of the ministry’s attention, but it is unfortunate that CSO proposals to support long-standing partner beneficiaries in facing the challenge of COVID-19 were totally disregarded.

In late 2020 the ministry issued a call for three ‘pre-defined projects’ in Ethiopia and Ghana, for which beneficiaries and activities had been identified and defined beforehand by the ministry itself. This meant that Maltese CSOs were effectively restricted to a service provision role, and were deprived of both ownership and the right of initiative.

Regrettably, none of the recommendations from last year’s reportwere taken into consideration.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase the amount of genuine aid to meet the objectives set at EU level, and make refugee costs additional to the ODA spending targets.

N

Increase the transparency of ODA reporting through an in-depth, comprehensive report on Malta’s overall ODA spending.

N

Improve aid effectiveness by ensuring predictability and multi-annual programming for the funds allocated to high-quality poverty eradication projects proposed by Maltese CSOs, by raising awareness of the development impact of Maltese CSOs, and by introducing a co-financing mechanism for larger grants (EC-funded development education and awareness-raising projects).

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

NETHERLANDS

MAIN CHANGES IN 2020

In 2020, Dutch ODA was 0.59%, thanks to a yearly cut of €1.4bn introduced by a former government in 2013.

After the pandemic had started, the Advisory Council on International Affairs advised the Dutch parliament to provide €1bn to support the international COVID response and to safeguard the ODA budget from the consequences of an economic decline. 1 In response, the Dutch government announced they would make €150m available for a COVID response, plus €350m to compensate for the GNI/ODA- associated cuts in 2020 and 2021. It is expected that €350m will not be sufficient to cover the cuts. An extra €456m is to be added across ODA budgets in future years.

In 2019, progress with the SDGs was reviewed under the Integrated Assessment Framework, which is used to assess the effects of new policies and legislation and is supposed to increase policy coherence for development. A review by Partos and its members, however, shows that the effects are not always assessed in a transparent manner.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Make the Netherlands an international champion in the fight against shrinking civic space.

N

Present a concrete step-by-step plan to return to the delivery of the 0.7% aid target by 2025.

N

Do not use future ODA to cover current gaps in the budget. Instead make available extra money from the general government budget.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

POLAND

MAIN CHANGES IN 2020

Since 2019, there has been no change in Poland’s level of ODA, which remained at 0.14% of GNI, with 74% of the PLN 3.13bn going through multilateral channels. Poland’s top ten bilateral ODA recipients remained largely unchanged, with Ukraine and Belarus still at the top of the list.

The government failed to implement most of the recommendations made in the AidWatch 2020 report, although it did include several recommendations from the 2017 OECD DAC peer review in Poland’s development cooperation strategy for 2021-30. The DAC recommended setting a clear quantitative goal for ODA; untying aid to LDCs; and referring to Agenda 2030 in the strategy.

The MFA has also committed to producing a multiannual strategy for global education, and country strategies for two to three crucial partners.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

PORTUGAL

MAIN CHANGES IN 2020

In 2020, Portugal’s ODA increased only slightly, by just 4.1%. Even though the outbreak of the pandemic made this an exceptional period, ODA-eligible actions stagnated at 0.16% GNI. With less than a decade left, the overall ODA levels are far lower than what is needed to meet Portugal’s ODA spending commitments by 2030. Despite continued pressure from civil society, the Portuguese government has still not put forward any plan for reversing the situation.

As has been mentioned in previous years, Portugal seems focused on closely integrating its development policies within the framework of its broader foreign policy goals. The programme of the Portuguese Presidency of the EU Council, presented in late 2020, explicitly acknowledged this by stating that Portugal would work to “encourage a European model of development cooperation that is more strategic and better aligned with the Union’s external policy priorities”. Although this is not new, the instrumentalisation of development policies to fulfil economic purposes has been increasingly evident.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Establish an ODA increase plan aimed at the 0.7% GNI target by 2030, while respecting the Development Co-operation Effectiveness Principle – this is now more essential than ever.

N

Build the new Portuguese cooperation strategy on the outcomes of an inclusive and participatory process where CSOs and partner countries are consulted so it can promote a genuine partnership between all parties.

N

Strengthen the practices of transparency, releasing detailed information on the implementation of programmes, particularly on the EU’s delegated cooperation and private sector financial instruments.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

ROMANIA

MAIN CHANGES IN 2020

In 2020, Romania’s total ODA amounted to €267 million, equivalent to 0.13% of GNI, increasing from 0.10% in 2019. Multilateral ODA remained the most significant part (76.7 %) of the total ODA budget. Romania’s bilateral support for LDCs rose from €0.57 million in 2019 to €2.1 million in 2020.

Romania has actively supported the Team Europe approach, regularly reporting to the EU on the activities it has implemented in response to COVID-19.

Reacting to the short- and long-term consequences of the COVID-19 pandemic, in November 2020 the Romanian government adopted the Multiannual Strategic Programme for International Cooperation and Humanitarian Assistance. In accordance with Romania’s global strategic objective of helping to eradicate extreme poverty, the key areas promoted in ODA activities are: crisis management, response to natural disasters and adaptation to climate change, strengthening health and education systems, social development, water security, peace and security, post-conflict reconstruction, good governance and the rule of law.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Increase ODA budgets from 2022 onwards (in particular, bilateral ODA).

N

Continue, and reinforce, the measures aimed at developing the capacity of civil society through appropriate and constant funding, as well as by involving CSOs in all consultation mechanisms and at all institutional levels.

N

Allocate appropriate funding to reach the 0.20% LDC ODA target. LDCs are the countries most vulnerable to the health-related and socio-economic consequences of the pandemic. Support for LDCs is crucial in order to prevent humanitarian crises caused by food shortages and collapsing health systems.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

SLOVAKIA

MAIN CHANGES IN 2020

n 2020, Slovakia contributed €118m to ODA (0.14% of GNI). The increase from 0.11% in 2019 was mainly caused by a disproportionately large amount of inflated aid (€17.4m, or 15% of total ODA).

The COVID-19 pandemic and decisions taken by the government and the foreign ministry led to most of the systemic plans (for processes, strategic documents, capacity and funding) being postponed or cancelled.

The call for proposals under the framework partnership agreement was cancelled, and other calls were issued in a way that reduced predictability and transparency.

Slovakia redirected €10m as a response to COVID-19. This was not new money and, needless to say, it will be missed elsewhere. Overall, COVID-19 made Slovak ODA more instrumentalised and exposed shortfalls in its capacity.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Create a realistic and binding plan for increasing the budget of the Slovak Republic for development cooperation, in order to fulfil its international commitment to reach 0.33% GNI by 2030.

N

Fundamentally rethink its internal redistribution of the total budget for ODA, with an emphasis on the revision of bilateral aid.

N

Promote a systematic, long-term focus on a smaller number of partner countries and sectors in order to increases effectiveness. Focus on a people-centred approach, and on leaving no one behind.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

SLOVENIA

MAIN CHANGES IN 2020

Slovenia’s ODA remained static in 2020, at €76 million (preliminary figure), representing 0.17% of Slovenian GNI. Multilateral aid increased to two thirds of Slovenia’s ODA in 2020, contrary to civil society’s longstanding recommendation to increase bilateral ODA to at least half of total ODA, and signalling an end to a three-year positive trend of decreasing multilateral ODA. Imputed student costs and scholarships increased again, to 55% of bilateral ODA, at the same time cutting the scholarships share to less than 4% of total imputed student costs and scholarships, which is a stark contrast to almost 10% in 2019.

In October 2020 the MFA submitted two draft guidelines, concerning gender equality and environmental protection, to civil society, for consultation. In a joint response, NGOs reiterated the importance of withholding public funding from all projects and programmes that failed environmental and gender-equality impact assessments.

Unfortunately, the Slovenian government has failed to respond to the recommendations from last year’s AidWatch report.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Slovenia must scale up its ODA, to meet agreed targets but also to tackle the COVID-19 challenge by increasing ODA to the 0.33% target and the 0.2% target for LDCs; it must extend bilateral ODA until it is at least half of total ODA; and it must strengthen its financial support for NGOs.

N

Responding to increasing imputed student costs, Slovenia must develop mechanisms for monitoring foreign students’ input to their countries’ development.

N

Establish a permanent policy coherence assessment mechanism for sustainable development – one that is open, inclusive and participatory in line with the 2030 Agenda.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

SPAIN

MAIN CHANGES IN 2020

n 2020, ODA dropped slightly, from €2.4bn to €2.3bn. This still represented an increase, however – from 0.19% to 0.22% GNI – as the pandemic caused the economy to shrink considerably. DAC policy markers show a decline in terms of gender and environmental and human rights. On the positive side, multilateral aid increased to record levels, reaching €1.7bn; humanitarian aid and ODA channelled through development NGOs increased by 46.9% and 14% respectively; and the Spanish Agency for International Development Cooperation (AECID) improved, rising in the International Aid Transparency Initiative (IATI) ranking from category ‘poor’ to ‘fair’.

At the end of 2020, the government approved the 2021 national budget, which raised genuine ODA by 10%. In addition, Spain has committed €1.7bn to the global pandemic response and has promised to donate 22.5m vaccines by the end of 2021. Finally, at the 2021 High-level Political Forum on Sustainable Development the government presented an overarching sustainable development strategy that commits Spain to achieving 0.7% ODA/GNI by 2030. However, a lack policy coherence is undermining the ODA programme. Spain is failing to fulfil its commitments under the Paris Agreement, is selling weapons in conflict areas, and is inactive on human rights and environmental protection issues.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Design and launch an ambitious reform that includes the institutional system and steps up its dialogue with all stakeholders. Ensure that fighting poverty and inequalities, the feminist agenda, human rights, climate and sustainability are key objectives.

N

Deliver a roadmap for achieving the 0.5% ODA/ GNI target in 2023 – as a step towards the 0.7% goal – prioritising instruments that reinforce effectiveness.

N

Ensure that fighting poverty and inequalities and upholding human rights remain the primary focus of both public and private financing for development cooperation, and that this funding is aligned with the development effectiveness agenda.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

SWEDEN

MAIN CHANGES IN 2020

The year started with quite negative and inward-looking discussions on development cooperation, both in parliament and in the national media. The pandemic further polarised positions on international aid. Several political parties looked to strengthen international aid for people affected by the crisis. The Moderates and the Sweden Democrats, by contrast, proposed reducing aid by 30% and 50% respectively.

In 2020, Sweden ́s ODA reached record figures in both absolute and relative terms (1.13% of GNI). This figure is higher than projected, however, because of €600m allocated to support the Green Climate Fund through a credit which, under DAC loan reporting rules, is reported in full as ODA in 2020 but which in fact covers multiple Swedish budget years. During the pandemic, fewer asylum seekers were able to arrive in Sweden, reducing in-donor refugee costs, so a budget of €60m was transferred to activities in partner countries.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Continue to meet the target of 1% ODA/GNI and promote a lively, fact-based public debate on global development and development cooperation.

N

In the coming update of Sweden ́s strategy for civil society, strengthen long-term, trust-based partnerships and dialogue adapted to their context. Ensure a solid analysis of the multiple roles played by democratic participation and civil society in achieving just, sustainable societies, and a focus on results based on the priorities of local actors for change.

N

Continue and strengthen Sweden ́s support for the Financing for Development Agenda, especially on development cooperation, tax justice and debt relief. Achieve all the targets of the Addis Tax Initiative, and support partner countries in striving for better accountability, gender justice and equality in the mobilisation and distribution of their public resources.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

UNITED KINGDOM

MAIN CHANGES IN 2020

2020 saw significant and deep-cutting changes to UK aid infrastructure and practice, which continued the existing trend of aligning UK development with the country’s own national interests. First, in June the prime minister announced the merger of the foreign and development ministries, a decision explicitly grounded in the desire to align the UK’s diplomatic, security and development interests more closely.

The shrinking of GNI thanks to COVID led to a £1bn package of cuts across the sector, with very little communication about where these fell. Then in November, the government announced its intention to reduce the percentage of ODA from 0.7% to 0.5% GNI, a cut of approximately £4.5billion. This decision has been widely opposed by the development sector and parliamentarians.

ODA spending in 2020 saw a prioritisation of resources for health in response to the COVID-19 pandemic. The UK was the fifth-largest donor to the global COVID-19 emergency, committing $462 million to meet humanitarian needs globally. The UK also prioritised resourcing and increasing climate finance through its ODA budget, part of its broader ambition of leadership ahead of COP26.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

Re-establish the legal commitment to 0.7% GNI/ ODA, in line with the International Development Act, as soon as possible. Where cuts are made, communicate them early and transparently and focus them where they will cause the least harm.

N

Continue to focus on poverty reduction in all decision making and implementation of all ODA, pursuing an inclusive approach that targets resources where they are needed most and that aligns with the SDGs, the aid effectiveness principles, the commitment to leave no one behind and other key international agreements.

N

Incorporate the expertise and best practice of the former Department for International Development into the new joint department to ensure that development objectives and approaches continue to be at the centre of both decision making and practice.

%

Genuine AID/GNI

%

Total AID/GNI

Download country report

EU Institutions

MAIN CHANGES IN 2020

In 2020, the EU institutions increased their total ODA by 29.8% in real terms, raising it to €17.7bn. This made them, collectively, the third-biggest global donor, and the second among EU actors, after Germany. The increase is mainly due to the mobilisation of (partly additional) funds for the EU Global Response to COVID-19. Both tied aid and interest repayments decreased in 2020, raising the EU institutions’ genuine ODA from 92% to 94%.

Throughout 2020, the overwhelming focus on the immediate response to COVID-19, through the new ‘Team Europe’ approach, dominated the EU’s development agenda. 107 The EU institutions, however, are still underperforming in terms of the quantity and quality of ODA it delivers. In 2021 and beyond, the Commission therefore needs to step up to ensure that no one is left behind: this requires a renewed commitment to the fundamental principles of sustainable development and a single-minded focus on the reduction of poverty and inequalities in partner countries.

RECOMMENDATIONS TO THE NATIONAL GOVERNMENT

N

In its annual work plan the European Commission should outline clear schemes to increase ODA in the 2021-27 period to meet the 0.7% ODA/GNI target and allocate 0.15-0.2% ODA/GNI to LDCs, while promoting more inclusive and resilient societies to ensure that no one is left behind after the COVID-19 crisis.

N

The EU institutions should not dilute the effectiveness of their ODA by using NDICI-Global Europe funding to pursue non-sustainable development policy interests, and should instead ensure that ODA contributes to the reduction of poverty and inequalities in partner countries.

N

The European Commission should work to establish a genuinely equal partnership with Africa, one that guarantees partner countries both the policy space in which to achieve the SDGs and an equal voice in shaping development financing.

Team Europe has significantly increased its contribution of Official Development Assistance compared to last year. This is crucial at a time when so many people in our partner countries face significant health, economic and social challenges linked to the COVID-19 crisis. The latest figures show that 10 years ahead of the due date to deliver on our commitment to provide 0.7% of our collective GNI as ODA, we are more determined than ever to achieve this target.

Jutta Urpilainen

European Commissioner for International Partnerships, April 2021

Download Eu Institutions report

AIDWATCH 2021

Introduction

What’s new about AidWatch 2021?

ENOUGH ODA?

EMPLOYING ODA CORRECTLY?

EFFECTIVE ODA?

EQUALITY FOCUSED ODA?

Recommendations to the EU

TO ENSURE ENOUGH ODA...

TO EMPLOY ODA CORRECTLY...

TO ENSURE EFFECTIVE ODA…

TO ENSURE EQUALITY FOCUSED ODA...

Trends in EU ODA by Country

Download aidwatch 2021

Get in touch with us

Salvatore Nocerino Telleria