LONDON, United Kingdom — According to the Organisation for Economic Cooperation and Development (OECD), Official Development Assistance (ODA) is resource transfers to “developing countries and multilateral organizations.” Governmental organizations or their executive agencies provide overseas aid while the OECD Development Assistance Committee (DAC) determines the eligibility and reviews the list of eligible countries every three years.
Overseas Aid Policies Helping Developing Countries
Overseas aid, often used interchangeably with foreign aid or development assistance, is critical in assisting countries experiencing economic, social and humanitarian issues.
According to the Foreign, Commonwealth and Development Office (FCDO) statistics, there has been a reduction in spending for the African and Asian regions from £1,366 million to £1,109 million and from £1,065 million to £938 million respectively for the 2021-2022 period. On the other hand, spending in Europe has increased from £61 million to £310 million.
According to the House of Lords Library, continued assistance for foreign aid is crucial as it promotes long-term growth for the benefit of the planet’s future, and also assists in the prevention and potential eradication of poverty in developing nations. Investing in ODA could be a lifeline for developing countries, providing them with the means to combat poverty, enhance healthcare, education, and infrastructure, and promote social progress. It is a concrete demonstration of goodwill and an effective tool for promoting inclusive and equitable growth in underdeveloped countries. Through ODA, people have the potential to improve the lives of millions of people and create a fairer and more prosperous world for everyone.
The Importance of Continued Overseas Aid
Certain countries have a legal obligation to dedicate a portion of their Gross National Income (GNI) toward aid spending. In compliance with The International Development (Official Development Assistance Target) Act 2015, the U.K. Government has to meet the U.N. target of allocating 0.7% of its GNI towards foreign aid.
It is imperative for the U.K., being a global pioneer in international development, and other influential nations to persist with foreign aid spending. The Integrated Review of Security, Defence, Development and Foreign Policy (IR) has laid a strategic framework until 2025, with four objectives in mind, highlighting the advantages nations can reap by providing foreign aid. These include maintaining strategic advantage through science and technology, shaping the future of an open international order, reinforcing security and defense domestically and internationally and fostering resilience at home and abroad, according to the House of Lords Library.
Although providing assistance to countries in need should always be a top priority, supporting foreign aid can have additional advantages. Some of these benefits include:
- Enhanced Security: Providing military aid can help prevent violence from spreading, which in turn can bolster allyship and support for governments. In 2021, Afghanistan received the largest amount of aid at £187 million. The FCDO claims that this is due to the Taliban takeover creating a humanitarian crisis.
- Economic and Trade Advancements: Foreign aid can establish international markets and allow donor countries to incorporate their national companies, creating new trade ties.
- Addressing Global Issues: Foreign aid can also be used to tackle pressing issues such as climate change, migration, and conflicts. In 2021, the United Kingdom allocated £1,052 of its budget to provide aid to “refugees in donor countries,” according to the House of Lords Library. Interestingly, this sector did not experience a decrease in spending providing assistance for food and accommodation.
In general, ODA plays a crucial role in our collective responsibility to create a fairer and more sustainable world. By providing effective foreign aid, countries and organizations can facilitate peacebuilding, sustainable development, health care enhancements and greater international collaboration.
– Erdona Sopa