Main Findings on ODA Volumes
- European ODA disbursements as a percentage of GNI
Even though the EU is performing below its overall commitment to ODA as a percentage of GNI, the overall ODA trend in 2007-2008 was positive, with an overall increase among EU donors and worldwide, both as a percentage of GNI and in the volume of net disbursements. In addition, key EU donors, including Germany, the UK, France, the Netherlands, Sweden, and Italy, appear to have increased their “real”, rather than “inflated” aid in nominal terms. This is a very positive trend leading up to the global economic/financial crisis, which is predicted to decrease real ODA in the coming years.
EU aid for health appears to have declined overall between 2006-2007. While the UK, Spain and Ireland increased their health ODA during that time period, the rest all have decreased health ODA or maintained it at the same level. The EU contributes roughly 46% of overall global health aid.
The Good News:
- Global ODA increased over 10% in 2008
- Almost all European donors increased their aid in 2008.
- The European Union (ie. the EC and 27 Member States) accounted for 63% of all ODA in the world in 2008;
- The ‘best performers’ in terms of ODA efforts are European, with Denmark, Luxembourg, the Netherlands, Norway and Sweden all contributing above the UN target of 0,7% ODA/GNI in 2008;
- The Nordic countries and Luxembourg remain the greatest per capita contributors. Norway provides the most - a substantial $837 per person – in contrast, taxpayers in many new Member States provide less than $10.
- The UK has become the greatest health spender in absolute terms, with more than a two-fold increase from two years prior.
The Bad News:
- Although most new Member States have increased their efforts, they have not reached nor are likely to reach their interim target of 0.17% ODA/GNI: Poland, Lithuania and Malta have already decreased their ODA in 2008.
- Austria was the only country of the former EU-15 where ODA declined in 2008: by $130 million. Its share of inflated aid mainly due to debt relief is over 43% of total Austrian ODA. The Italian government also has indicated severe aid cuts will come.
- A significant percentage of European ODA is remains ‘inflated’ with debt cancellation, student costs and refugee costs. Without inflated aid, Europe would spend 0.34% instead of 0.4% of their GNI on ODA.
- ODA spending in health decreased by $124 million over the previous year, mainly due to a decrease in European health ODA.
If the EU lives up to its commitments, EU aid levels will rise throughout 2007 – 2010. In its new Communication[1], the EU sets a collective target of 0.56%, while the interim target for the former EU-15 is 0.51% and for the new Member States 0.17%. The forecast of several Member States are not yet secured by clear timetables and many still refuse to set multi-annual commitments. Also, some new Member States have yet to demonstrate how they intend to further increase their aid volumes in the run-up to 2010 and they are far from their target of 0.17%. Regrettably, the lack of more precise individual country targets that would effectively sum up to 0.56% and the outlook of an economic and financial turmoil poses serious doubts on whether the EU will collectively live up to its commitment. In addition, the amounts that Member States are forecasting remain vulnerable to GNI developments and therefore, might not meet the targets.
[1] European Commission Communication on Supporting developing countries in coping with the crisis. COM(2009) 160 of 8.4.2009