Spending cuts by G7 test the viability of cooperation

Official Development Assistance (ODA) continues on the path of decline this year, with a further near seven percent drop (an estimated $152 billion) — the lowest level since 2014.

It follows the steep reductions in 2025 (of 23.3 percent) concentrated among the top five aid donors (Germany, France, Japan, the United Kingdom, and the United States) who accounted for 93 percent of the reduction (and 70 percent of which was borne by the US).

These are the latest ODA projections by the 38-member, Paris-based Organisation for Economic Cooperation and Development (OECD).

Even as 17 OECD members plan an increase of $0.7 billion in aid, the combined cuts by 16 other members of its Development Assistance Committee (DAC) amount to $12 billion. G7 countries (also OECD members) account for the largest share ($9.3 billion) of the aid cuts.

Sub-Saharan Africa (SSA) and the ‘least developed countries’ (LDCs) are experiencing the steepest aid cuts from bilateral and multilateral sources — facing the lowest ODA levels in 25 years. Thirty-two out of 49 countries in SSA are also LDCs.

The fall in bilateral ODA to SSA is 11.6 percent this year (after a 26.3 percent reduction in 2025) while the share of the decrease for LDCs is almost 11 percent more following the 25.8 percent drop last year.

The combined reduction in bilateral and multilateral aid to SSA and LDCs is almost 10 percent this year. The evidence of simultaneously declining multilateral ODA counters the suggestion that reductions in bilateral aid to the ‘poorest countries’ is compensated for by concessional flows through multilateral channels.

The cuts in multilateral ODA also affected core funding to United Nations entities which fell by 27 percent last year — the largest recorded annual drop. It will reduce by a further 3.4 percent this year.

Health at riskThis scenario of constrained funding casts doubt on conversations around reforming multilateral systems (underpinned by the UN). The sectors withstanding the worst of the cuts are governance, health, and humanitarian assistance. Health is most impacted, receiving up to one-third less this year than 2019 (before the Covid pandemic).

The effects of the cuts on countries are unevenly spread. For example, those countries in the most need of external health financing — like Malawi and South Sudan, which also depend on external sources for up to 60 percent of their health spending — are experiencing falls above 40 percent levels.

Others are Lesotho, Mozambique and Uganda that are dependent on G7-sourced health financing given limited domestic revenue generation scope.

The G7 has implemented the largest cuts. The health sector specifically faces the deepest cuts with bilateral ODA for health “falling to its lowest levels in almost two decades.” In the last two years, support to the sector has fallen by 29-46 percent.

Global paradoxYet ironically, one of the statements issued after the recent G7 leaders’ summit urged a coordinated global response to the Ebola outbreak in the DRC. In that statement, the US has reportedly deployed $370 million in health and humanitarian support to the Great Lakes region (committing $500 million more, specifically to the Ebola response).

On its part, the European Union pledged 493 million euros in emergency assistance for vaccines, treatment, and health security in the region.

The latest health ODA projections show that current levels are 63 percent below the 2022 peak during the Covid pandemic. As the current wave of the Ebola outbreak spreads, DRC and Uganda are dealing with almost 50 percent health aid cuts.

Within health financing, cuts are most affecting reproductive health services (at 54 percent in 2026) and communicable diseases. Support for malaria control is down by almost 60 percent and tuberculosis (57 percent).

ODA cuts also affect the education sector (22 percent fall) and food aid (44.5 percent fall). In 2024, the US was the dominant provider of food aid. Aid cuts to the Sahel are 35.6 percent. Also hit hard are the small island developing states with five of 15 recipient countries facing declines of up to 60 percent this year.

Transactional worldThe public health implications of the health aid cuts will certainly spread beyond the affected recipient countries. The present wave of the Ebola outbreak (primarily in the DRC) is an example of why it is important to invest resources in pandemic prevention and response to secure global health.

Yet, the factors underpinning these drastic shifts in ODA policy are unlikely to change as they relate to heightened geopolitical tensions, the persisting appetite for increased defence and security spending, and pressures to up domestic spending in donor countries.

As international relations get more transactional, strategic national interests trump altruistic considerations for aid and development cooperation. The example of aid to Ukraine brings the point home. Even after the recent fall in its receipts from the US, it still receives more support than the world’s 44 LDCs combined. In fact, the EU boosted their transfers to Ukraine.

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