Development aid reached a new peak of $142.6 billion in 2016, an increase of 8.9 per cent from 2015 after adjusting for exchange rates and inflation. A rise in aid spent on refugees in donor countries boosted the total – but even stripping out refugee costs aid rose 7.1 per cent, according to official data collected by the OECD Development Assistance Committee (DAC).

Despite this progress, the 2016 data show that bilateral (country to country) aid to the least-developed countries fell by 3.9 per cent in real terms from 2015 and aid to Africa fell 0.5 per cent, as some DAC members backtracked on a commitment to reverse past declines in flows to the poorest countries.

Official development assistance (ODA) from the 29 DAC member countries averaged 0.32 per cent of gross national income (GNI), up from 0.30 per cent in 2015, as aid volumes rose in most donor countries. Measured in real terms – correcting for inflation and currency fluctuations – ODA has doubled (up 102 per cent) since 2000.

ODA spent on hosting refugees inside donor countries jumped by 27.5 per cent in real terms from 2015 to reach $15.4 billion. That equates to 10.8 per cent of total net ODA, up from 9.2 per cent in 2015 and 4.8 per cent in 2014. Many donor countries have seen unprecedented inflows of refugees in the last two years, and the DAC is working to clarify its ODA reporting rules to ensure that refugee costs do not eat into funding for development. Humanitarian aid rose by 8.0 per cent in real terms in 2016 to $14.4 billion.

“While governments should be commended for sustaining investment in development during these difficult times, it is unacceptable that – once again – aid to the poorest countries is in decline. Recent signals from some donor countries on future aid levels add further cause for concern,” said OECD Secretary-General Angel Gurría. “Major donor nations have committed to refocus their efforts on the least developed countries. It is now time to turn these commitments into action. Together, we must pay close attention to where the money is going and what is being included in foreign aid.”

Overall, total net ODA rose in 22 countries in 2016, with the biggest increases in the Czech Republic, Germany, Italy, Poland, Slovak Republic, Slovenia and Spain. For some the increases were due to higher refugee costs. ODA fell in seven countries, with the largest declines seen in Australia, Finland, the Netherlands and Sweden. Of the several non-DAC members who report their aid flows to the OECD body, the United Arab Emirates posted the highest ODA/GNI ratio in 2016 at 1.12 per cent.