74 - Development aid and global health

Some EU member states cut aid this year, but others avoided doing so. Although the EU remains the world’s leading aid giver, there is an increasing focus on using development funding effectively.

Europe’s deteriorating economic position poses severe challenges to member state governments’ development strategies. They responded in a variety of different ways in 2011. Sweden and the UK made a point of keeping aid at high levels. Bulgaria also led by example by doubling its development aid budget, and Finland and Germany also increased aid spending. But other member states such as France, Spain and the Netherlands made cuts (although Dutch spending remains relatively high at 0.75 percent of GDP). Some of the worst-off governments such as Ireland specifically aimed to mitigate cuts to their developments budgets to ensure that this area of spending did not drop too drastically. Italy’s aid budget for 2011, on the other hand, was a shockingly low 0.1 percent of GDP.

Given the growing constraints on aid, there is an increasing focus on ensuring that what development funding exists is used effectively. This was the theme of an inter-governmental conference in Busan, South Korea, in November. A major goal was to improve the dialogue on aid with emerging non-Western economies. China initially indicated that it would not join a new development ministers’ forum to be launched at Busan, but it eventually did so. Non-governmental observers faulted the EU for taking too low a profile at the conference – especially in dealing with China – and for letting the US and other Western powers lead. 

In October, the European Commission also announced that it was overhauling its aid to prioritise promoting democracy and good governance in poor states, implying cuts in aid to emerging economies such as India. The European Commission has specifically announced that it will cut aid to growing economies in Latin America such as Brazil. The UK, on the other hand, has decided that it will continue to give some aid to India. Member states and the EU institutions also continued work begun in 2010 to develop the EU’s first global health strategy as a framework for spending money overseas more efficiently.