The Impact of Decentralised Development Co‑operation

Decentralised development co-operation (DDC), or development co-operation led by cities and regions, is playing an increasingly important role at a time when official development assistance (ODA) is facing its steepest decline on record. In contrast to overall ODA, DDC ODA across the 15 DAC countries with available data doubled between 2013 and 2024, rising from USD 1.8 billion to USD 3.6 billion. Yet robust evidence on the impact of DDC has so far remained limited. This report provides an extensive assessment of how DDC contributes to local governance and SDG outcomes. It draws on localised DDC ODA data, two surveys of more than 180 subnational governments across Development Assistance Committee (DAC) and partner countries, and 16 case studies. The report shows that DDC generates benefits for local and regional governments both in DAC and partner countries. Non-financial activities such as peer-to-peer learning strengthen institutions and improve service delivery in partner cities and regions, while local and regional governments in DAC countries gain new knowledge and more effective multi-level co‑ordination. Building on this evidence, and taking into account the diversity of DDC approaches, the report offers guidance for national and subnational governments on how to strengthen the impact of DDC.