Are aid agencies facing an existential threat?

Details
10 July 2012
Announcement

By 2025 the world will be closer than ever to ending global poverty and two thirds of the remaining 600m or fewer poor people will live in fragile and conflict affected states in Africa. That’s the estimate of a new report from the Overseas Development Institute which concludes that aid agencies must overcome a major ‘existential threat’ if they are to prove ultimately effective at eradicating absolute poverty.

The Horizon 2025 report builds on projections that over 50% of global trade and spending will lie with economies beyond Europe and the US by the middle of the next decade.  By 2025 the world will be home to trillion dollar economies in Brazil, Russia, India, Indonesia, Turkey, China, Poland and Saudi Arabia, with several others close behind, and 78% of the global middle class will be from ‘developing’ countries - leading to a boom in exchanges between previously poor countries.

Large pockets of ‘stubborn poverty’ will remain in fragile and conflict affected states, mostly in Africa, such as the Democratic Republic of Congo and Nigeria.

Report co-author Andrew Rogerson said:

“Aid agencies must adapt to new realities or face their own irrelevance. The increasing scope of philanthropic giving and peer-to-peer technology, the rise of southern economies and the scale of the challenge posed by climate change all pose questions for how traditional ‘aid’ can continue to yield  catalytic effects.”

Rogerson continued:

“In a world where there are far fewer absolutely poor people it will be a challenge to sustain taxpayer support for aid. The paradox is that as the end-goal of eliminating poverty comes closer, in practice the deep-rooted difficulties of the weakest states could become harder both to tackle and to raise money for. That’s why we are challenging aid donors now to think about how they will need to have evolved by 2025.”

The report is now available on the ODI site, accompanied by an ODI Opinion by Andrew Rogerson exploring the findings.