UK’s overseas financial support drops significantly in 2020

BySusanna Gevorgyan

UK’s overseas financial support drops significantly in 2020

UK Official Development Assistance (ODA), defined as a resource flow to emerging countries and multilateral organizations, declined by 4.6% in 2020 compared to 2019, reaching £14,479 million says the new summary report published by the Foreign, Commonwealth and Development Office (FCDO). According to the publication, in 2020, health was the only sector that recorded a sharp increase as an ODA recipient with Ethiopia, Nigeria, and Somalia being the countries receiving the most funding.

ODA was defined by the United Nations General Assembly in 1970 as a GNI target contribution of 0.7%. In 2020, although the UK Government met this target, ODA declined by £698 million compared to 2019. The UK spent £9,533 million on bilateral ODA which accounts for 65.8% of the total. UK funding to multilateral organizations was £4,945 million or 34.2% of overall ODA. FCDO spending decreased in 2020, reaching £10,664 million compared to the £11,786 million recorded in 2019. Overall, in 2020, FCDO accounted for 73.7% of the UK’s total ODA while in 2019 this figure was 77.7%. Non-FCDO disbursements in 2020 were £3,815 million (26.3%) compared to £3,391 million in 2019 (22.3%).

Regional data

Overall, in 2020, 52.9% of the UK’s bilateral ODA, or £5,041 million, was allocated to region-specific funding, 14.6% less than in 2019. Africa continued to be the main recipient accounting for 51.8% of the total region-specific bilateral ODA although this fell by £375 million in 2020 compared to 2019, reaching £2,610 million. Asia was the second-largest recipient on the list, receiving 39.2% of the total region-specific bilateral ODA. Broken down to country level, the largest recipients were Ethiopia, Nigeria, and Somalia with £254 million, £241 million, and £232 million bilateral ODA received in 2020.

Fig.1. UK bilateral ODA by region in 2020

Source: Statistics on International Development Final UK Aid Spend 2020

Fig.2  Top 20 recipient countries: UK bilateral ODA, 2020

Source: Statistics on International Development Final UK Aid Spend 2020

The FCDO’s newly published annual report defines the actual ODA and non-ODA program resource funding for the 2020-21 financial year and the budget for 2021-22. According to the publication, East and Central Africa, with a budget of £1,116 million for the 2020-2021 financial year, is expected to receive only £545 million in the 2021-2022 financial year. Similarly, West & Southern Africa and the Middle East & North Africa, with funding of £708 million and £621 million in 2021-2022 respectively, are expected to receive £345 million and £237 million in 2021-2022.

Preet Kaur Gill MP, Shadow Secretary of State for International Development, commenting on the UK ODA spending cuts, said:

“After months of avoidance FCDO accounts have finally revealed the true damage of the callous and counter-productive aid cuts which are already costing lives. These revelations come with barely a month until the UN climate conference in Glasgow and in a week when the Prime Minister has criticized other governments for failing to support low-income countries to tackle the climate crisis. They show how this Conservative government have removed any credibility they still had and left us all less safe by cutting programs focused on climate and bilateral aid to countries already bearing the brunt of the climate crisis.”

Sectoral data

To address the challenges brought about by the pandemic, in 2020 the UK spent £1.66 billion of its bilateral ODA, of which 32% was dedicated to activities earmarked for specific countries or regions. As much as 95% of the funding intended for COVID-19 was channeled via the FCDO. Overall, the sectors receiving the largest amount of bilateral ODA were health with £1,590 million, humanitarian aid with £1,531 million, and multisector/cross-cutting with £1,112 million.

Fig.3. Top 5 sectors: proportion of UK bilateral ODA, 2020

Source: Statistics on International Development Final UK Aid Spend 2020