IMF Survey: Where's the New Aid Money?
IMF News, July 20, 2007
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- Authors: Jeremy Clift IMF Survey
- Published: July 20, 2007
Overview
- At the 2005 Gleneagles summit, the Group of Eight (G8) leaders promised to double aid to sub-Saharan Africa by 2010.
- Two years later, there is little sign that the promise is translating into increases in overall aid to most sub-Saharan countries.
- On balance, according to the World Bank's Global Monitoring Report 2007, there is "scant evidence of any substantial scaling up of aid on the horizon."
Aid trends and figures (DAC/OECD reporting)
- Aid to all countries (including middle-income recipients) declined, in constant 2005 dollars, to $103.9 billion in net aid in 2006, down by 5.1 percent from 2005.
- The $103.9 billion figure includes $19.2 billion of debt relief, notably exceptional relief to Iraq and Nigeria.
- Excluding debt relief grants, net aid fell by 1.8 percent in 2006, according to preliminary data published by the OECD.
- While in real terms the decline in official development assistance in 2006 was the first reduction since 1997, aid levels were still the highest recorded, with the exception of 2005.
Other donors, private sources, and global health funds
- Other forms of aid are on the rise, including from private sources, health funds, and emerging market donors, such as China.
- China's official assistance to Africa in 2006 was estimated at $19 billion and it has said it will step up aid further.
- Overall aid from private sources doubled during 2001-05 to $14.7 billion, according to the World Bank.
- Global funds to combat HIV/AIDS are estimated to reach $9 billion in 2007, according to the United Nations Development Program.
Implications for the Millennium Development Goals (MDGs)
- Several recent studies indicate further progress toward the MDGs would require substantial net increases in official development assistance.
- Estimates by the World Bank and the United Nations suggest that additional official assistance in the order of $40-60 billion a year would be needed to meet the MDGs.
- Based on the G8 commitment in Gleneagles in 2005 to double aid to Africa, the OECD estimates that assistance from the DAC countries would rise by $50 billion in real terms between 2004 and 2010.
IMF Survey online — July 20, 2007