European Union development aid allocations

Abstract

Development aid is an important feature of the international system, and the European Union (EU) and its Member States together form the world’s largest development aid donor. This research investigates the extent to which the distribution of EU development aid is based on need. Development aid allocations are subject to political considerations and biases, and this can lead to significant imbalances between comparable recipient countries. The potential exists for the EU to disburse aid using an aid equity approach; multilateral donors are generally less subject to traditional aid-biases, and the EU is seen as potentially playing a normative role in international affairs. Thus it is worth considering how the EU’s development aid distribution compares to the relative needs of recipient countries, and additionally how well it compares to the development aid distributions of key Member States. This research relates to many theoretical debates, such as the nature of the EU as an international actor, and the factors that guide, or should guide, development aid distributions. It examines the EU alongside key Member States, rather than alone or alongside other more typically multilateral donors. Also, compares the EU’s development aid distribution against need as indicated by the Human Development Index (HDI), rather than against need as measured economically, or against factors of institutional performance. A study such as this has a high degree of social relevance and importance, as the issue of global disparities is perhaps the most significant facing our world. Development aid is seen as an important means of helping to improve the quality of life of people in developing countries, and the EU and its Member States constitute the leading development aid donor. The research adopts a quantitative approach, and uses official development aid disbursement figures from the OECD. It creates and introduces an aid allocation model based on the HDI. It then compares the proportions of development aid recommended by the model for each recipient against the proportions they actually received during the 2001-2013 period. The main finding of the analysis is that the EU’s development aid distribution has two clear biases; a geographic bias towards the Enlargement area and Neighbourhood, and a population size bias against large countries. However, once these biases have been accounted for, the development aid distribution of the EU is shown to be closely associated with relative levels of need as expressed by the model.