Analyzing International Aid

There is a growing consensus that extreme poverty can be ended by 2030.

The truth is that we cannot meet this goal without international aid. In sub-Saharan Africa alone, 400 million people live in extreme poverty and require interventions that are targeted and complementary to existing support to lift them out of it.

If we want to maximize the impact and reach of international aid, we need to ensure that every dollar is spent as efficiently as possible. We can only do this with better information. Then policymakers in both donor and recipient countries can make better and more informed decisions, and civil society can better monitor progress and hold them to account.

Now, for the first time ever, thanks to a major new report that analyzes international aid, we can see just how much aid flows between specific countries and, crucially, what that aid consists of. Investments to End Poverty is a report that analyzes international aid in all of its complexity.

At Development Initiatives, each individual record of foreign aid from OECD donors over the period 2006-2011 was analyzed. The results are striking. For example, according to our calculations, Italy and Denmark both gave very similar levels of bilateral aid, just above $2 billion, in 2011. But almost 70% of Italy’s aid stayed in the country, spent on refugee costs and debt relief; whereas around 70% of Denmark’s aid resulted in a transfer of resources to developing countries.

On the recipient side, some countries that appear to receive considerable funds in fact receive a lot less than advertised. Our research found that of the $7.5 billion in aid reported as given to the Democratic Republic of Congo in 2011, more than $5 billion was not transferred to that country, and consisted instead of debt relief.

[Charles Lwanga Ntale, Africa director of Development Initiatives, writing in CNN]

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