The Supreme Court of the United States has cancelled the disastrous decision of the Trump-Musk team to stop and dismantle USAID, the country’s agency for development cooperation. It seems this is not the end of the story though. USAID may be reformed, take up its work again, or indeed disappear.

Whatever happens, this should be seen as an excellent opportunity for a fundamental debate on development and development cooperation, a debate that is long overdue. For sure, USAID is not a “criminal organisation” and its civil servants are not "radical lunatics" as the government people want the public to believe. But yes, there are many legitimate questions about the agency and the way it works. Other rich countries should join in a serious reflection on what exactly one wants to achieve in the South.

It is indeed not appropriate to point an accusing finger only at the US. The development sector has long been in crisis and criticism is never treated seriously.

In France, the development policy budget was cut by no less than 37%, on top of the 800 million euros already cut in 2024.

Back in 2020, the UK decided to stop spending 0.7% of GDP on foreign aid, reducing it to only 0.5%. It was then called a “temporary measure”. The new Labour government has now decided to further cut to 0.3%.

The new government in Belgium decided to cut the development cooperation budget by 25%.

Germany is also lowering its ambitions for development cooperation.

In the 1970s, it was decided that all rich countries would spend 0.7% of GDP on development aid. It was never achieved. Countries in the OECD, participating in development cooperation, are now at barely 0.4%. Only Luxembourg (1%), Sweden (0.89%), Norway (0.86%) and Germany (0.85%) have met the mark, till now. Had 0.7 % indeed been paid from the 1970s onwards, US$ 1200 billion more would have gone to the South.

Development

One of the main problems with aid to “development” is that this development never had a stable and clear definition. After the independence of colonized countries, the major objective and demand of Southern governments was for industrialization, better terms of trade and technology transfer. Former colonial powers essentially tried to keep their former possessions within their sphere of influence and give their corporations interesting opportunities for business and profits. The consequence, inevitably, was more “white elephants”, and useless and expensive infrastructure works.

In the 1970s, attention briefly turned towards “social development”, though Southern countries surely did not want any interference in their domestic policies.

The 1980s were the start of the “lost decades” for development and “structural adjustment” with new neoliberal dogmas. Development economies were suddenly outdated, there was but one single global market with identical rules everywhere. In the 1990s, “poverty reduction” was added, doing away with any definition of “development” in which the economy – and the State – played a significant role. From “under-development” one passed to “the underdeveloped” in a globalised world.

Development cooperation agencies followed the trend and continued to do good business. The NGO world dedicated itself mainly to humanitarian aid.

This humanitarian work – which is not “development” – is the most successful and useful form of aid. A closure of USAID and a cut in budgets elsewhere will certainly have dire consequences for vulnerable people in the South. Just think of the HIV programmes, maternal and reproductive health, vaccination programmes, care for children, education, etc. For all organisations that worked with USAID funds, the consequences will be disastrous and will claim thousands of lives.

Geopolitics and profits

However, one should not forget that the whole international development project was born at the beginning of the Cold War and with the independence of the former colonies. Never did geopolitics go away and never did national interests go away. Governments and businesses had to benefit and still do.

As far as USAID is concerned, political support for dictatorial and military regimes in Latin America is particularly striking, as well as for the colour revolutions in Eastern Europe. "Interim President" Juan Guaidó of Venezuela and his ambassador in Washington received more than US$ 1 billion in aid. An investigation has now been launched. In Cuba, millions of dollars went to ghost companies and to ZunZuneo, a Twitter system meant to help the opposition. More than three billion also went to BBC Media Action, a BBC charity, so it seems.

For European countries, no one will deny the influence of Belgium in its former colony of the RDC or of France in countries of Western Africa.

There is no reason to denounce the whole of the development sector, but it should not be a surprise that, on balance, the “aid” did not promote development, growth or “poverty reduction”.

Poor results

In 1971, there were 25 least developed countries; in 1991, there were 52, and today there are still 46. The most extremely poor people live in black Africa.

In 1990, it was decided to make poverty reduction the major priority of North-South cooperation. But until today, this is not apparent from the figures.

According to the OECD, only 9.5% of aid goes to poverty-related sectors. Only 1% of bilateral aid goes to social protection, 0.11% to strengthening labour law, 0.01% to social dialogue mechanisms, and 1% to strengthening tax systems. Nowhere does aid go primarily to the poorest countries. For OECD DAC countries, it was in 2022 only 21.5 % , the lowest since 1996.

In poor countries such as Malawi, 70% of the population is still extremely poor. In Madagascar, it is 80%; in the RDC, 69%; and in South Sudan, 67%. Could it really be that difficult to lift people out of poverty?

According to the World Bank, in 2023, 733 million people suffered from malnutrition, a sharp increase since 2019.

People with no prospects of a better life are leaving their country and trying to migrate to the North.

Money spent in rich countries to help refugees and migrants from the South is deducted from development aid. So the official figures are wrong. In the European Union, in 2022, no less than 17.3 per cent of total aid was involved. Moreover, 11% of total aid went to Ukraine.

It is estimated that some 20% of the total aid disbursed does not meet the OECD's official development cooperation criteria.

More and more, “development” is being left to the private sector.

There is extensive literature on the efficiency of development aid, but there are no clear answers. The NGO or the philanthropic sector are never taken into account. In the multilateral aid sector, billions of dollars get lost because institutions such as the World Bank, for instance, are not really interested in how their money is spent, their profits come from the loans themselves. The more money they spend, the more profit they have. As for the internal evaluations of the financial institutions, they frequently are very negative.

Add to all this the illegal financial flows from South to North organised through transfer pricing in international trade; African capital in Switzerland, Panama, and Dubai; the foreign debt tricks that make poor countries pay and keep them paying; the permanent drain on legal and illegal mining; and so on. It is reverse development aid.

Stop aid?

In 2009, a Dutch television programme announced that the Dutch government had decided to stop all aid disbursements for African countries. The Minister for Development Cooperation declared the aid was too fragmented, that there was no “good governance” in too many countries, and that poor and vulnerable people received no help.

The NGO world was stunned, but several African governments reacted positively! “I do not believe God has created Holland so that it can develop Tanzania”, former President Mkapa declared.

It was fiction and it was a provocation, but it clearly indicated what many people really thought. It was also what the famous author Dambisa Moyo had written in her book Dead Aid in 2009. There is a serious problem of democracy and accountability with development aid. Populations cannot put pressure on their governments, because they hardly pay any taxes, whereas governments only owe accountability to their donors, not to their people.

This point had been raised from the beginning of the whole development project. If governments have real and good development policies, they do not need aid. If they do not have these policies, the given aid will not help.

The only conclusion should be that yes, humanitarian aid should be continued, it is too important for people’s lives. But for the rest, a serious debate is necessary on what development means, what it is that countries of the South want, and how rich countries can help.

The upcoming Conference on the Financing of Development, beginning in July in Seville, Spain, is an excellent opportunity to start this discussion. If we truly believe in “one world” and in solidarity between all human beings, it is a moral and political duty to put an end to the hypocrisy of “development cooperation”.

However, we know that for all these years, far more capital has flowed from South to North than vice versa. We talk about development aid but the countries of the North earn extremely well from it.