What are the opportunities for Italy’s development co‑operation in a context of heightened political attention, expanded engagement in Africa, and growing use of new financing instruments, while maintaining coherence, effectiveness and impact across an increasingly complex system? These dimensions underpinned the OECD Development Assistance Committee’s (DAC) peer review of Italy, which was conducted by Germany and Iceland.
Italy’s development co-operation is shaped by a strengthened political commitment to Africa. Since the launch of the Mattei Plan in 2024, Italy’s development co-operation has entered a new phase, being placed more firmly at the heart of foreign policy and mobilised to address global challenges such as poverty, climate change and migration, while seeking greater engagement with the private sector. In this context, Africa – already a major focus of Italian co‑operation – has been further consolidated as the central geographic priority, receiving 65% of Italy’s bilateral official development assistance (ODA) in 2024. While this has increased the visibility and strategic relevance of Italian co-operation, stronger political steering through the Prime Minister’s Office and an expanded set of priorities have also increased delivery demands across the system, heightening the need for greater transparency and continued efforts to streamline procedures, reinforce capacity of its human resource model, and strengthen results and learning frameworks to maximise impact.
Against a backdrop of global ODA reductions, Italy has sustained its ODA levels; however, current resourcing is not in line with its stated ambition and risks becoming less focused. While ODA levels have stabilised at 0.29% of gross national income (GNI) in 2024, they remain well below the international commitment of 0.7% of GNI reaffirmed in Italy’s 2024-2026 Programming and Policy Planning Document (PPPD). As geographic ambition has expanded under the current PPPD, particularly through a growing number of priority partner countries in Africa, the absence of a commensurate increase in ODA has amplified the importance of clear country-level priorities and simplified delivery arrangements. Nevertheless, high public support for international co-operation should enable Italy to maintain a people-centred approach, with a sustained focus on poverty eradication, gender equality and inclusion, including in least developed countries and fragile contexts.
Italy’s financing model is evolving, comprising an increasing share of concessional loans. Loans disbursed by the Italian Climate Fund and the Revolving Fund for Development Co-operation represented 11% of bilateral ODA in 2024. Greater use of sovereign loans should help Italy to scale up the size and ambition of its bilateral programmes, including for climate action, but also highlights the need to carefully assess the appropriate mix of grants and loans in low-income and fragile contexts. With a budget of EUR 4.4 billion, the relatively new Italian Climate Fund (ICF) represents a major strategic asset, offering significant scope to scale Italy’s climate and development impact through instruments such as budget support, policy-based lending, and private sector engagement. Fully leveraging the ICF will require clearer articulation of where different instruments are most suitable, while prioritising highly concessional support to protect the poorest and most vulnerable, and continuing to manage potential debt sustainability risks.
Italy has strengthened whole‑of‑government co-ordination to support delivery, but institutional complexity continues to represent a challenge. Italy operates a dense co-ordination architecture, including the Inter‑Ministerial Committee for Development Co‑operation (CICS), the Joint Committee (JC), and newer bodies linked to the governance of the Mattei Plan and the Italian Climate Fund. System‑wide missions have emerged as a promising mechanism to align actors upstream and generate shared project pipelines. Nevertheless, infrequent meetings of the CICS limit its ability to effectively arbitrate on coherence issues across policy areas. In addition, the inclusive co-ordination in annual programming before projects reach the JC for formal approval can delay implementation. Building on existing co-ordination arrangements to clarify complementarities, further adapting to the Prime Minister’s Office’s enhanced role in Africa‑related initiatives, and preserving clear lines of responsibility will be key to sustaining coherence and effectiveness.
The Italian Agency for Development Co‑operation (AICS) remains a central operational pillar of Italy’s bilateral development co‑operation and a valued partner on the ground. Its technical expertise, flexibility and close relationships with civil society underpin Italy’s delivery model. Yet, human resource limitations and centralised processes can constrain its responsiveness to partner country needs. The latest Convention between the Ministry of Foreign Affairs and International Cooperation (MAECI) and AICS seeks to clarify the division of labour, while striving to simplify procedures. Increased MAECI oversight will need to be balanced against the goal of improving efficiency to reinforce the competitiveness of Italian co-operation and AICS’s credibility as a strong implementing partner, including for EU delegated co-operation.
Italy continues to advocate for multilateralism, channelling a substantial share (54%) of its ODA to and through multilateral organisations. Italy has demonstrated leadership through innovative financing approaches, debt-for-development swaps and support to multilateral development banks to expand their lending capacity. Safeguarding predictable, multi-year funding, including core and softly earmarked funding, to select multilateral partners, and engaging more strategically with other providers – including through delegated co‑operation and blended finance approaches – would complement the reach of Italy’s bilateral efforts and support priorities under the Mattei Plan. Italy’s now well-established development finance institution, Cassa Depositi e Prestiti (CDP), positions it as a strategic partner for multilateral actors, including through co-financing with multilateral development banks, and in co-ordination with AICS, MAECI and the Ministry of Economy and Finance (MEF), can help overcome operational constraints, support delivery of larger programmes, and improve efficiency.
Migration and development are of increased strategic importance to Italy’s international engagement. Italy has elevated migration and development as government priorities and was the first DAC member to develop dedicated guidance on the migration-development nexus. Migration is recognised both as a development challenge and as an economic opportunity. In practice, however, migration-related interventions remain fragmented across instruments and actors. Strengthening cross‑government coherence, protecting human rights, engaging the diaspora more strategically, advocating for labour mobility, and maintaining a focus on fragile contexts in countries of origin will be essential to further advancing development outcomes.
Growing emphasis on private sector engagement marks an important evolution, increasing the need for system-wide co-ordination. Italy’s development co‑operation now brings together a wide range of actors involved in private sector engagement (PSE), including development, finance, trade and export promotion institutions. The expanded role of CDP in managing development finance is reflected in a growing number of country offices and instruments for PSE, reinforcing Italy’s operational footprint, but also increasing demands on its staffing and institutional capacity. While the breadth of actors and instruments offers opportunities for scale and innovation, it also carries the risks of fragmentation and duplication, further heightening the importance of ensuring complementarity across the system. As Italy scales this agenda, supported by a growing interest from Italian companies, the forthcoming private sector engagement guidelines provide a welcome opportunity for articulating a clear whole-of-government vision while ensuring that development additionality and partner-country priorities remain at the core.