Rich countries need to increase the amount of aid given to poor nations even though the level reached last year was a record high, the Organisation for Economic Cooperation and Development (OECD) said this week.
At the same time, the World Bank and International Monetary Fund (IMF) have called on rich nations to act boldly this year if global poverty is to be reduced, especially in sub-Saharan Africa.
The announcements came ahead of the two bodies’ biannual summit this weekend.
In a review of official aid by leading donor nations, the OECD said rich countries increased their aid flow by 13,7% to a record $78,6-billion. When inflation and the effect of the weaker dollar are stripped out, however, the increase in real terms was 4,6%.
Aid to Iraq and Afghanistan, particularly from the United States, increased last year. Iraq received $2,9-billion in aid and Afghanistan $875-million. Last year’s tsunami led to an exceptional mobilisation of private and official resources for relief.
As a proportion of gross domestic product (GDP), the average for the 22 nations surveyed was 0,25%. Norway was the most generous nation, donating 0,87% of its GDP, while Italy came in lowest at 0,15%.
The US is the most generous donor in volume terms, giving $19-billion last year. As a proportion of GDP, however, this is only 0,16%.
Aid from the US was nearly a quarter of the total donated, its highest proportion since 1986 and nearly double the low point of 12,5% in 1995.
The 15 members of the European Union have pledged to donate 0,39% of their GDP by next year. Taking this, and other pledges into account, the target for all nations is 0,30%.
”Aid is being delivered but not fast enough and efforts have to be stepped up if this target is to be reached,” said Brian Hammond, head of statistics for the OECD’s development assistance committee.
One of the Millennium Development Goals aims is to halve the number of people living in severe poverty by 2015.
Hammond said estimates for the additional funds necessary to achieve these goals ranged between $50-billion and $100-billion a year. The internationally agreed United Nations target is 0,7% of GDP.
Currently, five out of the 22 nations donate 0,7% or more: Norway, Luxembourg, Denmark, Sweden and The Netherlands.
United Kingdom Chancellor of the Exchequer Gordon Brown has pledged to double Britain’s aid flows to 0,7% of GDP by 2013. France, which gives 0,42% of GDP, has matched the UK’s pledge.
UK Prime Minister Tony Blair and Brown are keen to use the country’s presidency of the EU and the G8 nations to reduce poverty in the developing world.
In a report ahead of this weekend’s meeting, the World Bank and IMF said the developed world had to double aid by 2010 and speed up global trade talks if the Millennium Development Goals were to be met.
James Wolfensohn, the bank president, said: ”Without early and tangible action to accelerate progress, the goals will be seriously jeopardised — especially in sub-Saharan Africa.”
The report said Africa needed at least 10 years of sharply accelerated growth, at 7% a year — double the current rate — for poverty to be halved by 2015.
As most Africans rely on agriculture, persuading rich countries to stop subsidising their farmers and create a fair global market would dramatically reduce poverty in the continent, the report said.
Zia Qureshi, a senior adviser at the bank, said: ”Achieving a global fair trade environment is critically important for achieving the millennium goals. We hope this report and other similar messages will amplify this message to a crescendo … If the rich nations can summon up the political will to act, the outlook for the developing world is much more propitious today because economic growth in the developing world … is strong,” he added. — Â