NGOs Criticize the EU Member States for Exaggerating the Amount of Development Aid

The recent report “EU Aid: Genuine Leadership or Misleading Figures?” reveals that especially UK, France and Germany have exaggerated the amount of the Official Development Assistance (ODA). According to the report drawn up by European NGOs, as much as €13.5 billion or almost one third of reported European ODA in 2005 did not provide any new aid for developing countries. Instead, this sum of money included, among other things debt cancellations and costs of foreign students and refugees in donor countries.

OECD figures show that €121 million, or 17%, of the Finnish ODA in 2005 was used on debt cancellations. In addition, 2% was spent on housing refugees in Finland. At moment, Finland is also considering registering the cost of educating foreign students in Finnish universities on the aid figures.

“The debt cancellation for Iraq covered almost a fifth of the Finnish development aid last year. It is just about cooking the books because no money was transferred outside the national borders in reality. Our report emphasizes that development aid criteria have to be specified. This way, the aid would really be directed to reduction of poverty as the people expect it to be,” Tytti Naho, the Secretary for Development Policy of KEPA (Service Centre for Development Cooperation), states.

When debt acceptances and refugee costs are removed from the ODA, Finland’s aid was 0.38% of the GNI last year and was still far away from the objective of 0.7%.

The report also criticizes Italy of which the real amount of aid is the lowest of the 15 old Member States. As for current EU president Austria, the proportion of inflated aid was over 60% of the Austrian ODA. Luxembourg, Denmark, Netherlands and Sweden performed well in the report: all those countries have achieved the United Nations aid target of 0.7%.

Including the debt cancellations in development aid is not accordant with the decisions made at the United Nations Financing for Development summit in Monterrey (2002). In Monterrey, it was agreed that debt cancellations should not be reduced from development aid. Last year, the EU countries made a joint commitment to increase ODA and to achieve the UN goal which is 0.7% of GNI to development aid by 2015.

A large number of European NGOs have participated in compiling the EU Aid report, including Eurodad and the European NGDO confederation, CONCORD. The section on Finland is written by KEPA and the Finnish NGDO Platform to the EU, KEHYS.

The report on .PDF format.

More information:

Tytti Nahi Secretary for Development Policy, KEPA +358-9-54823246, +358-40-7724247

Rilli Lappalainen, Secretary General, KEHYS +358-9-23150560, +358-50-5613456