Are we stingy? How well does foreign aid add up?
Jan England, emergency relief coordinator for the United Nation, started an international uproar when he described First World donor nations as "stingy. England was assessing the meager commitments from Western governments in their imediate response to the South Asian earthquake and tsunami disaster. The U.S., for example, initially offered $15 million in disaster relief. To put that figure in perspective, in the same week Catholic Relief Services alone committed $25 million to respond to the overwhelming humanitarian disaster.
England's comments drew outraged howls from conservative pundits in the United States and may have inadvertantly inspired an embarrassed round of "competitive compassion" as Western governments abruptly tried to outdo each other in tsunami aid declarations, but was he so far off in his evaluation of the affluent world's overall response to global destitution and suffering?
The truth is few countries give more than 1 percent of their annual Gross Domestic Product to development aid. And while many Americans are under the completely erroneous impression that the U.S. devotes as much as 20 percent of its annual budget to foreign aid, the reality is that succeeding presidential administrations have historically committed about 1 percent of their budgets to aid. In 2003, U.S. foreign aid came to just .14 percent of the country's GDP.
U.S. aid in terms of percentage of U.S. GDP is already the lowest of any industrialized nation in the world, though paradoxically in the last three years, its dollar amount has been the highest. And while U.S. aid has increased dramatically in recent years, much of the new disbursements have been related to the war on terror and reconstruction efforts in Iraq and Afghanistan. Meanwhile, Israel and Egypt continue to make their annual claims to the lion's share of U.S. overseas aid.
Ultimately, England cannot be called a liar in his depiction of Western donors. When the world's governments met at the Earth summit in Rio de Janeiro in 1992, they adopted an Official Development Assistance (ODA) aid target of 0.7 percent of gross national product (GNP) for rich nations, that is, the 22 members of the OECD (Organization of Economic Cooperation and Development) known as the Development Assistance Committee (DAC).
Despite this modest commitment, over the past decade almost all rich nations have consistently failed to reach the agreed obligation of 0.7 percent. Instead, the amount of overall aid has been around 0.2 to 0.25 percent, some $100 billion short of the goal.
Since 1992, Japan had been the largest donor of aid in terms of raw dollars. In 2001 the United States reclaimed that position, a year that also saw Japan's amount of aid drop by nearly 4 billion dollars as the value of the yen collapsed.
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|ODA in U.S. Dollars (Millions)||ODA as GNP Percentage|
Source: OECD Web site
Note: The U.N. ODA agreed target is 0.7 percent of GNP. Most nations do not meet that target.