According to the preliminary data released by the Organization for Economic Cooperation and Development (OECD), 2021 saw a marked increase in Official Development Assistance (ODA) by the member-countries of the Development Assistance Committee, year-over-year, rising to an all-time high of US$179 billion, an increase of 4.4% compared to 2020.
Nearly all of that increase came in the form of donated COVID-19 vaccines, calculated to have a value of $6.3 billion (using the official formula of valuing each dose at $6.72). Excluding donated vaccines, ODA in 2021 rose a nominal 0.6% in total dollar amounts.
The record volume of ODA in 2021 was provided by the thirty countries – members of the DAC (including the European Union, which acts as a member of the committee). Moreover, aid volumes rose in twenty-three DAC member countries, and fell in six countries. Thus, the $179 billion aid represented 0.33% of the combined Gross National Income, which is way below the 0.7% target set by the OECD in 1970.
Only five DAC-member countries exceeded the 0.7% target: Denmark (0.70%), Germany (0.74%), Luxembourg (0.99%), Norway (0.93%) and Sweden (0.92%). Beyond DAC member-countries, Turkey also encountered a ratio of ODA/GNI of 0.95%.
Which are the top donor countries?
Amongst OECD members, the largest donor of ODA in 2021 was the United States ($42.3 billion), followed by Germany ($32.2 billion), Japan ($17.6 billion), UK ($15.8 billion) and France ($15.4 billion), an identical ranking to 2020. Of significance, however, is that total donations to international organizations rose by 9.4% compared to 2020 while bilateral ODA dropped by 3.3% as a result of less bilateral sovereign lending.
TOP-10 ODA contributors, 2021, $ billion
Source: Preliminary OECD data for 2021
OECD reporting does not include aid spend from China, which claims to have provided more than two billion doses of vaccines to a total of 120 countries (the data provided by the Chinese authorities could not be corroborated with sources outside the country). This indicator puts China in first place in terms of the number of vaccine doses distributed. Data concerning total ODA spending from China for the year 2021 is not currently available, but press releases and news reports indicate a slight increase in ODA (even excluding donated vaccines). In 2020, the amount of foreign aid by Beijing was $2.94 billion.
Facts and trends of foreign aid in 2021
- G7 donors provided 76% of total aid.
- EU countries contributed 45% of the aid by the OECD member countries.
- UK aid spending fell by 21.2% as a result of increased domestic spending to address the economic impact of the pandemic. the country’s yearly ODA target downgraded from 0.7% of GNI to 0.5% of GNI.
- Italy’s ODA rose a nominal 34.5% in ODA, mostly due to debt cancellations.
- Greece’s ODA fell by 23.9% due to a reduction in refugee costs.
- South Korea’s ODA rose 20.7% due to an increase in bilateral loans.
- Switzerland’s ODA increased by 6% due to its response to the crisis in Afghanistan.
- The United Arab Emirates’ ODA spend in 2021 was down 24.1% due to a government strategy to decrease bilateral assistance.
- Humanitarian aid spend equaled $18.8 billion, up 3.5% from 2020.
- ODA spend on refugees was $9.3 billion in 2021, virtually unchanged from 2020.
- Debt relief totalled just $545 million in 2021.
- Bilateral sovereign loans by DAC countries fell by 4.6%, and represented 10% of ODA .
- Net bilateral ODA flows from DAC countries to Africa, rose by 3.4% to $35 billion, compared to 2020. Within this amount, the aid to sub-Saharan Africa was $33 billion, an increase of 2% in real terms.
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