Brussels, 22 October 2025 — The 2025 AidWatch report, released today by CONCORD, exposes how, by blurring the definition of Official Development Assistance (ODA) and hijacking its core purpose, the EU and its Member States undermine the effectiveness of their financial resources for sustainable development. They do so while claiming to be the largest provider of ODA. Reforming ODA governance and its reporting system could ensure that EU ODA is back on track to its intended purpose, aligned with partner countries’ needs and allocated where it can have greater impact, ultimately increasing its effectiveness.
2025 marks AidWatch’s 20th anniversary, and also a year widely seen as a turning point – or paradigm shift – for international cooperation amid widespread cuts to ODA. The EU and EU Member States’ share of Gross National Income (GNI) to ODA fell from 0.53% in 2023 to 0.47% in 2024. Seven EU Member States (Austria, Belgium, Finland, Germany, France, Netherlands, Sweden) have announced or implemented ODA reductions. Together, these countries account for approximately 75% of global ODA. If cuts persist, the EU’s claim of being top ODA providers could be in jeopardy.
Besides the cuts, current practices by EU Member States and Institutions often fail to align with their spending rhetoric, exposing a persistent misallocation of ODA. Neither Least Developed Countries (LDCs) nor sectors most vital to inclusive human development are prioritised by the EU. In 2023, EU ODA to LDCs amounted to only 0.12% of GNI, or EUR 13.9 billion [1]. A share unchanged since 2021. Meanwhile, Global Gateway loans to upper-middle-income strategic partners increased by 23% in 2024. These trends stand in stark contrast to the EU’s stated commitments at the Fourth Financing for Development Conference held in Seville (FFD4) this summer to prioritise countries left furthest behind.
“The Global Gateway is beginning to show how far the EU’s use of ODA is drifting from its original purpose. The EU wants to boost its own competitiveness, but to do so is using money that should primarily benefit partner countries, to support European private sector investments around the world. The EU must make sure that its ODA offers tangible positive impacts for the populations of partner countries.”
Restoring the credibility of ODA requires it to be counted only for what it is meant to do, aligned with its intended purpose. By counting as ODA spending that should not qualify as such, the EU and its Member States inflate their ODA figures, making them seem more generous than they actually are. Most of the EU’s inflated spending in 2024 was attributable to reporting items as ODA that do not meet the basic eligibility criteria such as in-donor refugee costs in the case of EU Member States. Notably, the ODA inflation of just three countries (Germany, France and Italy), exceeds the total ODA of Austria, Belgium, Denmark, Spain and Finland combined. Allowing private sector instruments, such as loans to the private sector, to be reported as ODA will lead to these shares increasing even further in the coming years and to blur even more the definition of ODA and its core purpose.
Governments committed to meeting the 0.7% ODA target continue to set and interpret the rules that determine what counts as ODA. As a result, EU Member States and Institutions have been able to define how their own performance is assessed. The lack of sanctions for missing the target only weakens the credibility of these commitments. It is time to democratise and reform ODA governance to give partner countries a real say in how ODA should be delivered to make it truly effective.
“ODA can make a big difference for many people. For decades, it has improved health systems, access to education, life expectancy, and so much more. But ODA alone cannot counteract the structural inequalities present in the broader spectrum of finance available for Global South countries: these must be corrected profoundly and urgently, whether in the areas of debt, taxation, or the governance of international financial institutions.”
Notes to editors:
[1] The most recent year for which data are available. For reference, EU Institutions and EU Member States have repeatedly committed to allocating between 0.15% and 0.20% of GNI to LDCs by 2030.
For media inquiries, please contact:
Marine Le Bourdoulous | Communications Adviser
Lur Fernandez Salinas | Policy and Advocacy Adviser
The 2025 AidWatch report is available here https://aidwatch.concordeurope.org