Ukraine was the biggest single recipient of international aid in 2023 for the second year in a row, but EU aid spending dropped by nearly eight percent, according to new data published on Thursday (11 April).
Kyiv received €18.5bn in Official Development Assistance (ODA), the statistics by the Paris-based Organisation for Economic Co-operation and Development revealed. The total cost of that hosting refugees in donor countries accounted for more than $31bn [€28.9bn] — equivalent to 13.8 percent of total ODA in 2023.
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Meanwhile, despite a small rise in ODA across all wealthy countries in 2023, aid from the 21 EU members of the OECD’s Development Assistance Committee (DAC) fell by 7.7 percent to €92.9bn.
In-donor refugee costs, where a donor country counts as aid the money spent accommodating and providing for refugees fleeing war, are not a new innovation. However, the figures have risen dramatically in the wake of Russia’s war in Ukraine.
Development policy specialists have warned that using in-donor costs to inflate domestic aid budgets risks devaluing aid policy, and the target set by wealthy governments more than 50 years ago of spending at least 0.7 percent of gross national income (GNI) on aid. Only Luxembourg, Norway, Sweden, Germany and Denmark hit this target in 2023, while DAC countries would have had to increase their combined contributions by almost $200bn to meet this commitment.
“Going forward we need donors to ramp up their support for the poorest and most vulnerable countries, in particular least developed countries and countries in sub-Saharan Africa,” said OECD DAC chair Carsten Staur.
“We need more focus on efforts to help partner countries counter extreme poverty and address climate change.”
Increased refugee flows resulting from the war in Gaza could lead to high in-donor costs become a permanent feature of aid spending, say analysts. The OECD reported that ODA to the West Bank and Gaza increased by an estimated 12 percent in 2023, a figure that is likely to grow substantially this year as the war between Israel and Hamas rages on with massive humanitarian costs. Many argue that In-donor costs should not come from ODA budgets.
“A closer look reveals that yet again, geopolitical priorities and domestic budgets have taken precedence over the needs of the world’s poorest people,” said Matthew Simmonds, senior policy and advocacy officer at the European Network on Debt and Development.
“Keeping already insufficient aid at stagnating levels costs lives and is a moral failure,” said Oxfam’s aid expert Salvatore Nocerino.
The UK government, which published its own aid spending figures on Wednesday, reported that almost 30 percent is being spent on refugee costs.
However, several countries are bucking the trend. “Germany and Austria are clearly differentiating between in-donor refugee costs and ODA,” Simmonds told EUobserver, adding that this practice of taking in-donor refugee costs out of ODA should be formalised.
“If this is going to be a permanent thing, then the rules on aid are not fit for purpose,” he said.