ODA is declining in countries and territories where poverty is concentrating
Successful poverty reduction over the past three decades have mostly benefited China and India, leaving sub-Saharan African populations and those in contexts of high and extreme fragility with the highest concentrations of extreme poverty. Currently, 72% of people in extreme poverty live in sub-Saharan Africa and 83% in contexts facing high and extreme fragility – shares projected by the World Bank to rise to 76% and 88% by 2030, respectively. These places also face acute challenges of income inequality.
The share of ODA from all official providers to these countries and territories, while still significant, is falling. In 2023, 24% of ODA went to sub-Saharan Africa, down from 29% in 2021 and the peak of 38% in 2006; and 36% went to contexts facing high and extreme fragility, down from the peak of 49% in 2019. Projections indicate that ODA from Development Assistance Committee (DAC) donors to sub-Saharan countries could face a 16-28% decline from 2024 to 2025, while ODA to contexts experiencing high and extreme fragility could decline by 18-29% between 2023 and 2025. The growing divergence between the geography of poverty and ODA allocations underscores a widening mismatch between where challenges are concentrated and where concessional resources are directed. Unless addressed, this trend risks undermining global efforts to reduce compounding poverty, inequality and vulnerability to climate shocks.
ODA to countries with the highest poverty and inequality rates is concentrated among a few donors, some of whom have announced cuts
In 2023, the International Development Association (IDA) was the largest provider of ODA to the top 20 countries with both the highest poverty and inequality rates. Leading bilateral providers of ODA to the 20 countries most affected by extreme poverty in 2023 included: the United Kingdom, Sweden, Australia, Norway and Germany. Leading providers to the 20 countries with the highest income inequality were: Germany, Sweden, the United Kingdom, Norway and Belgium. Several of these providers are expected to cut ODA in 2025-27, including contributions channelled through multilateral organisations, which could result in cuts to countries with the highest poverty and inequality rates in the coming years.
ODA per person in extreme poverty does not reflect the global distribution of poverty – it is lowest where poverty is highest
Least developed countries (LDCs) have historically received larger volumes of ODA than other income groups. However, when ODA is measured per person in extreme poverty - a metric that represents how much ODA each person living in extreme poverty would receive if total ODA were distributed evenly among them within a specific grouping, such as by country income group or region - this picture reverses. In 2023, LDCs received three times less ODA per person in extreme poverty than upper-middle-income countries (UMICs). Ten years earlier, LDCs received almost twice as much as UMICs. Over the last decade, ODA per person in extreme poverty has stagnated for LDCs, while it has risen steadily for lower-middle income countries (LMICs) and UMICs.
Regional trends show similar disparities. Sub-Saharan Africa receives the largest total ODA volumes, but the lowest ODA per person in extreme poverty. In 2021, ODA-eligible countries in Europe received 45 times as much ODA per person in extreme poverty as countries in sub-Saharan Africa, and by 2023 the gap widened to 600 times as much resulting from the sharp increase in ODA to Ukraine.
Countries facing high and extreme fragility receive greater total ODA volumes than those experiencing medium to low fragility. Until 2020, they also received more ODA per person in extreme poverty. Since then, however, ODA per person in extreme poverty in contexts of medium to low fragility has gradually – and since 2022, rapidly – increased. This sharp rise was largely driven by aid to Ukraine, which is classified as experiencing medium to low fragility despite its exposure to severe security fragility, given its strong resilience across other dimensions of fragility. The trend persists, though much less pronounced, when Ukraine is excluded.
ODA per person living in extreme poverty varies widely across countries
Between 2010 and 2021, ODA per person in extreme poverty varied considerably across countries, but disparities sharply increased in 2022-23 (as measured by the squared coefficient of variation). In 2023, countries at the lower end - such as the Democratic People’s Republic of Korea, Angola, India, Nigeria, the Democratic Republic of the Congo and Madagascar - received 9 - 60 USD per person in extreme poverty, while Ukraine and Moldova received USD 1.474 million and USD 329 thousand, respectively. These are significant outliers: from 2010 to 2023, no other country exceeded USD 250 thousand and only six others surpassed USD 100 thousand per person in extreme poverty.
A relatively small, and often decreasing, share of ODA targets core poverty- and inequality-reducing policy areas
In 2023, ODA to poverty-focused sectors as defined by SDG 1.a.1 – basic health and education, water supply and sanitation, basic social services and food aid – represented 12.7% of total sector-allocable ODA (USD 20.5 billion), well below its 2021 peak of 17% driven by COVID-19 health spending, and closer to pre-pandemic levels.
Across the three dimensions of the global Multidimensional Poverty Index (MPI) - health, education and living standards – ODA shares and volumes have declined in recent years. In 2023, ODA volumes to these dimensions fell to their lowest level since 2015, and their share to the lowest point in the entire 2010-2023 period.
ODA to other key objectives related to poverty and inequalities – such as social protection, domestic revenue mobilisation, justice, food security and decent work - also peaked between 2020 and 2022 before declining sharply in 2023. Apart from food security, these sectors receive only a small share of ODA.
Finally, in 2022-2023, 46% of ODA from DAC members targeted gender equality and 26% targeted disability inclusion, either as a significant or principal objective. Support to these policy areas is important at a time when discrimination is rising globally.
