Rising aid

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Reaching the Millennium Development Goals by the internationally agreed date of 2015 will require a major funding effort. If commitments from the OECD countries that make up the Development Assistance Committee (DAC) are upheld, then official development assistance (ODA) should rise.
The pledges made in Monterrey, Mexico, in 2002, for instance, are for aid flows to increase to $86 billion by 2006, the largest rise in the DAC’s 43-year history. Italy, already the world's seventh largest donor, has reaffirmed its commitment to double its aid in a recent DAC review. According to simulations published in the latest DAC Journal, total aid from its 22 member countries could rise by 27% in real terms. The US, which is the world’s largest donor by value, will increase its aid by 32%, or $5.1 billion in real terms, while the combined EU total will rise by 31%, or $11.5 billion. The simulations for 2006 show large percentage increases from Austria, Greece and Portugal, with the lowest increases coming from the Japanese (7%), Danes and Swiss (5% each), and the Dutch (4%). But whereas the Danes and Dutch already figure among the five DAC countries to surpass the UN recommended target for aid of 0.7% of gross national income (GNI), the Swiss ratio will hold steady, at 0.38% of GNI and the Japanese ratio will grow from 0.20% to 0.22% of GNI. Meanwhile, the UK and Spain have announced their intention to reach the 0.7% target, so bringing to 11 the number of DAC member countries to have either met it or announced a date by which to meet it. If these and earlier commitments are maintained, they would lift total ODA to over $100 billion by 2010. The DAC’s member countries account for over 90% of global bilateral ODA.© OECD Observer No. 244, November 2004


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