Netherlands

Summary

ODA Spending

How much ODA does the Netherlands contribute?

In 2022, the Netherlands was the 8^th largest donor country, spending US$6.5 billion on ODA. This corresponded to 0.67% of its GNI, putting it in 6^th place in a ranking of countries’ ODA expenditures relative to the size of their economies.

How is the Netherlands’ ODA changing?

Between 2020-2021 the Netherlands’ ODA and GDP decreased, followed by an increase in 2022, partly due to increased spending on IDRCs.

According to the latest development strategy, published in June 2022, the Netherlands plans to increase ODA spending by EUR300 million ( US$316 million) from 2022-2024, and then annually by EUR500 million ( US$526 million) from 2025 onward. Additionally, the ODA budget linked to GNI is expected to increase, though a large share of prospective ODA increases has already been allocated for refugee costs.

However, the increases stated in the 2022 development strategy may not materialize following multiple development budget cuts announced in 2023, totaling EUR3.5 billion ( US$3.7 billion) over 2023-2026. Moreover, the right-wing and central-right parties who won elections in November 2023 are expected to continue the trend of development cuts in all areas except humanitarian relief and peace and security.

Where is the Netherlands’ ODA allocated?

In 2022, the Netherlands channelled 66% of its ODA bilaterally, including earmarked funding through multilaterals. This split between bilateral and multilateral funding in the Netherlands is likely to remain stable in coming years. The Netherlands’ strong bilateral funding focus is reflective of the government’s focus on promoting trade relationships and strengthening the link between development and trade.

Bilateral Spending

In 2022, IDRCs received the largest funding share of the Netherlands' bilateral ODA for the first time since 2018.

The Netherlands' spent the second-largest share of bilateral ODA in 2022 on government and civil society. Funding to global health, an area closely related to Dutch thematic priorities, saw a significant jump between 2020-2021, and remained elevated in 2022.

The Netherlands selects its focus regions and countries based on three elements:

• The urgency and need for development cooperation;
• The added value of Dutch efforts; and
• The potential for alignment with Dutch thematic priorities.

LICs remain the main recipients of the Netherlands’ ODA. Priority countries tend to be the countries of origin for a high proportion of migrants and refugees arriving in the Netherlands.

The Netherlands provided all its ODA as grants in 2022. Although it does not extend loans as part of its development cooperation, engaging the private sector and promoting private sector growth in LICs is one of the government’s key priorities.

Multilateral Spending and Commitments

Approximately 23.9% of the Netherlands’ 2024 ODA budget goes towards multilateral cooperation. In 2023, this percentage was 26.6%. The Netherlands provides core contributions to several multilateral organizations, including the UNDP, UNICEF, and UNIDO, as well as international finance institutions including the AfDB, the World Bank, and the EBRD. The decrease in core multilateral cooperation funding was likely triggered by reallocations toward humanitarian relief funding to UN organizations like UNHCR, as well as then ends of several multiyear obligations.

In December 2022, the Netherlands published its policy framework on global multilateralism. This framework is complementary to the government's coalition agreement and existing strategies, including the 2022 development strategy, the international climate strategy, and the global health strategy. The policy framework outlines three multilateral pillars:

• Protecting the multilateral system against influences that undermine the international legal order and human rights;
• Strengthening the Netherlands’ position and that of the EU in the current dynamic geopolitical multilateral field of influence; and
• Ensuring the multilateral order is more representative, coherent, efficient, and effective, operating in line with the vision and mission of the founding treaties and statutes.

The Netherlands’ recent commitments to multilateral organizations are summarized below.

Politics & Priorities

What is the current state of Dutch politics?

The Netherlands is a representative democracy with a parliamentary system. Elections take place every four years except in the event of a dissolution.

The Dutch government, sworn in on January 10, 2022, resigned on July 7, 2023. Mark Rutte, who served as the Prime Minister since 2010, handed in his resignation after it became clear that there were irreconcilable differences between the coalition parties’ views on migration. The outgoing coalition consists of Rutte’s own liberal-conservative VVD party, the pro-European Democrats party 66 or the D66 party, the Christian-Democrat CDA, and the more social-Christian ChristenUnie party. The prime minister, ministers, and state secretaries will carry out their duties in a caretaker capacity until a new cabinet is formed following the elections that took place in mid-November 2023.

The nationalist, right-wing populist Party for Freedom PVV won the 2023 elections with 37 seats in parliament. Party leader Geert Wilders does not support immigration. The PVV's manifesto aims to put any climate agreements and measures “through the shredder” and to “immediately stop development cooperation” to redirect resources to Dutch citizens. If the PVV successfully forms a coalition government, the development budget is expected to shrink further than the EUR3.5 billion ( US$3.7 billion) in budget cuts announced in September 2023.

Since the election, the PVV has entered a process of forming a government coalition with the VVD, the Christian Democratic NSC, and the right-wing populist Farmer-Citizen Movement BBB. The four negotiating parties are working together with two government informants to explore the feasibility of a ‘program cabinet’, where the four party leaders outline key objectives and financial parameters, which will then be fleshed out by the new cabinet ministers. None of the party leaders will assume the Prime Minister position, candidates will be determined later.

Who is responsible for allocating the Netherlands’ ODA?

Dutch CSOs play an active role in Dutch development cooperation. The development CSO umbrella organization Partos represents over 100 organizations that engage with parliament and the MFA to influence policy and funding decisions. Many CSOs implement their own programs in LICs and are funded by the Dutch government and through private donations. Since the end of 2015, program funding for CSOs has been cut sharply, and the MFA has placed a larger focus on strategic partnerships and advocacy. From 2021, funding for CSOs has been channeled through the new Strategic Partnership programs focusing on various themes. A total of 42 CSOs were funded under the Strategic Partnership grant scheme, under four different funding calls: Power of Voices (includes food security, climate adaptation and human rights programs), Power of Women, the SRHR Partnership Fund, and Women, Peace and Security. The partnerships cover the period 2021-2025 and cover a total of EUR1.3 billion ( US$1.5 billion).

What are the Netherlands’ development priorities?

The objectives and priorities of the outgoing Dutch government's development policy are laid out in the policy document, Doing What the Netherlands is Good At. Released in June 2022 under Foreign Trade and Development Cooperation Minister Liesje Schreinemacher, the document focuses on the intersection between trade and development priorities. The strategy’s self-proclaimed keyword is ‘focus,’ which covers both a geographic focus of 25 priority countries, and a thematic focus of traditional policy areas of expertise, including water, agriculture, and SRHR. Digitalization and sustainability appear as cross-cutting themes throughout the strategy.

The strategy focuses on three key areas:

1. Trade: Dutch trade policy with LMICs will concentrate on a smaller number of markets, focusing on strengthening Dutch earning capacity and, together with trade partners, strengthening sustainability, digitalization, economic resilience, and the protection of entrepreneurs against unfair competition. Within the EU, the Netherlands aims to maintain its position as a driver for international corporate social responsibility legislation;
2. Development cooperation: Tackling the root causes of ‘poverty, terrorism, irregular migration, and climate change,’ as well as reaching the SDGs remain the focus of Dutch development cooperation. Additional investments are dedicated to the COVID-19 pandemic, strengthening global health systems, and climate change. Traditionally, strong areas of thematic expertise for the Netherlands like water, agriculture, and SRHR maintain high importance; and
3. Strengthening the link between trade and development cooperation: Dutch businesses are set to become much more involved in achieving the SDGs in 14 emerging economies. This effort attempts to increase investment in sustainability and digitalization, as well as strengthen the connection between Dutch organizations and local partners. PPPs focused on export and innovation policy are of particular importance.

The Dutch government published its first Dutch International Climate Strategy and Global Health Strategy in October 2022.

Following the 2022 development strategy Doing what the Netherlands is Good At, the Dutch MFA published a theory of change for strengthening the private sector to promote development on November 28, 2022. The ministry believes that strong SMEs help accelerate the transition to sustained, inclusive, and sustainable economic growth in LMICs with decent work for all ( SDG 8), especially women and youth. The three main ways that the MFA aims to strengthen SMEs in its 40 private sector development priority countries include:

• Fostering business climate, for example, by strengthening farmers’ cooperatives to better represent farmers’ interests;
• Improving trade conditions and making trade and production more sustainable through value chains, logistics, and ensuring policy coherence between international trade agreements and legislation regarding Corporate Social Responsibility; and
• Increasing sustainability and inclusivity in the financial sectors of priority countries through financial products and services for SMEs, especially those owned by women and youth.

The Netherlands streamlined processes for CSOs to access funding in December 2022. Dutch Minister for Foreign Trade and Development Cooperation announced that the Netherlands has made an additional EUR8 million ( US$8 million) available for the Civic Space Fund's ‘flex option', meant for urgent, short-term projects, and lowered the application request minimum from EUR100,000 ( US$105,000) to EUR25,000 ( US$26,000).

The government divides grants for civil society in the new policy framework into seven specific themes:

• Climate mitigation and adaptation;
• Increasing sustainability of value chains;
• Food security, sustainable water management, and WASH;
• Women's rights and gender equality;
• Freedom of expression and freedom of religion and belief;
• Equal rights for LGBTQ+ populations; and
• Security and the rule of law.

Since 2016, the Netherlands has crafted development policy coherence action plans to improve the effectiveness of Dutch development policies. The Dutch government evaluates these action plans and reports on their progress yearly.

On November 25, 2022, Dutch Minister for Foreign Trade and Development Cooperation Liesje Schreinemacher submitted a third revision of their strategy for development policy coherence and on achieving the SDGs.The action plan focuses on three themes that are important for both the Netherlands and the LMICs it supports: reducing the Dutch climate, land, and water footprint, targeting illegal money and tax avoidance, and lowering vaccine and health inequality.

The outgoing government will continue to carry out the existing strategy until a new government is formed. If the four negotiating parties ( PVV, VDD, NSC, and BBB) are successful, the Netherlands’ development strategy is expected to focus more on asylum reception in the region to prevent migration in the Netherlands, and short-term humanitarian relief. Themes such as climate action and equal rights of women and LGBTQ+ populations are expected to be deprioritized by right-wing coalition parties.

By Issue

The Netherlands views gender equality as a prerequisite to all other development goals. The Netherlands is a global champion for gender equality, particularly in SRHR. ‘Equal rights and opportunities for women and girls’ and SRHR are two of the Netherlands’ development priorities. The Netherlands also launched its Feminist Foreign Policy in 2022 and is expected to publish the policy document.

If the four negotiating parties ( PVV, VDD, NSC, BBB) form a new coalition government, Dutch ODA and foreign policy in support of gender equality will be at risk. The largest, right-wing negotiation party PVV committed in its 2023 election manifesto to ensure that the government does not participate in gender equality measures.

| Read more about the Netherlands’ ODA related to Gender Equality

Climate: Regarding climate finance, the cabinet is committed to allocating 50% of public climate finance to adaptation. This is in line with an increasing focus on climate, which began under the previous government.

The Dutch government has also committed to increase its biodiversity finance by 50% by 2025. In line with this commitment, Dutch Minister for Foreign Trade and Development Cooperation Liesje Schreinemacher announced on December 19, 2022, that the Netherlands will contribute EUR50 million ( US$53 million) to the Nature, People and Climate investment program of the CIF, which focus on nature-based solutions.

The Netherlands was the host of the Climate Action Summit from January 25-26, 2021. In another step forward for climate action, the Dutch development bank FMO published a position statement on June 1, 2021, committing to phase out direct investments in fossil fuels over the course of a five-year transition period. The policy prohibits the bank from making any new direct investments in upstream or mid-stream stand-alone fossil fuel-related activities, with an exemption for natural gas and distributed power projects necessary for energy security at affordable prices. At COP28, the Dutch government launched an international coalition to phase out fossil fuel subsidies, comprising 13 countries: Antigua and Barbuda, Austria, Belgium, Canada, Costa Rica, Denmark, Finland, France, Ireland, Luxembourg, the Netherlands, and Spain.

From March 22-24, 2023, the Netherlands co-hosted the UN Water Conference alongside Tajikistan in New York. Among the over 670 commitments made by attendees to address water-related issues as part of the Water Action Agenda, the Dutch government made several commitments. The Netherlands pledged EUR55 million ( US$58 million) in contribution to initiatives that help countries strengthen response towards water-related disasters and climate change.

If the new government coalition comes into being, climate-related ODA will likely be challenged.

| Read more about the Netherlands’ ODA related to Climate Change

Education has decreased in priority for the Netherlands. In the newest development strategy, the Dutch government stated it would prioritize larger and longer programs on a smaller number of priority areas. According to the HGIS, the Ministry of Education, Culture, and Science has committed to slightly increasing its ODA for university education from EUR48,000 ( US$57,000) in 2021 to EUR50,000 ( US$53,000) in 2022 and 2023.

| Read more about the Netherlands’ ODA for Education 

The Netherlands considers itself to be an international leader in the area of agriculture. It is prioritizing green energy and digitization transition especially in trade to lower international trade costs in its development cooperation. The Dutch government also sees agriculture as intertwined with food security, water management, and climate protection.

| Read more about the Netherlands’ ODA for Agriculture

By Region

In line with its 2022 Doing What the Netherlands is Good At policy, the Dutch government’s regional focus is on the ‘West African Sahel,’ the ‘Horn of Africa,’ and the MENA region. The 2022 development strategy lays out the Netherlands’ 22 focus countries for development cooperation, which also include countries outside of these focus regions, such as Mozambique and Bangladesh. In addition, the strategy also outlines 25 trade focus countries and 14 countries where both development cooperation and trade will be combined in bilateral programs.

The Netherlands published an updated Africa Strategy in May 2023, which outlined short-, mid-, and long term actions to promote the 54 countries’ equal economic development, reduce poverty, improve human rights, and limit irregular migration.

In particular, the strategy displayed the Netherlands’ ambition to strengthen and deepen its strategic relationship and partnership with African countries, both bilaterally and multilaterally through the EU, with a focus on equitable and reciprocal cooperation based on mutual interests. Key themes included:

• Promoting regional stability, mobility, and migration agreements;
• Achieving the SDGs and AU 2063 Agenda; and
• Increasing the prosperity and climate resilience of people and communities in Africa and Europe.

The strategy was based on consultations with Dutch, international, and African knowledge institutions and think tanks, as well as CSOs, international organizations, and partners in African countries.

The Netherlands also provides a range of support to 12 specific LDCs on the SDGs. Those countries largely coincide with the Netherlands’ focus regions and include Benin, Burkina Faso, Burundi, Ethiopia, Mali, Mozambique, Niger, Palestine territories, South Sudan, Sudan, Uganda, and Yemen.

At the same time, the Netherlands continues activities targeted toward specific objectives in 10 LMICs. Examples include the reception of refugees in Jordan and Lebanon, as well as reconstruction in Iraq. The full list of countries receiving targeted support covers Afghanistan, Bangladesh, Chad, Egypt, Iraq, Jordan, Kenya, Lebanon, Somalia, and Tunisia. In 2020, the Netherlands began ‘phasing out’ of several countries. These include Ghana and Indonesia, with which they intend to intensify their trade relations going forward.

Since the beginning of the Russian war in Ukraine in February 2022, the Netherlands has been a key provider of support to Ukraine. On December 21, 2023, the Netherlands launched its support package of 2024 to Ukraine, totaling EUR102 million ( US$111 million) and aimed at providing urgent needs to help Ukraine get through winter and prepare for spring.

The four parties ( PVV, VDD, NSC, BBB) negotiating to form a new coalition government have generally negative views on immigration and asylum seekers. As a result, funding towards peace and security, as well as humanitarian support and migration are expected to be prioritized. Since the war in Ukraine has caused Ukrainians to flee and settle in the Netherlands, providing military and humanitarian relief to Ukraine could be used as a mechanism to prevent further immigration to the Netherlands. Also, in terms of regional focus, ODA may primarily be focused on countries that host many refugees or asylum seekers in order to prevent further migration to the Netherlands.

Budget

What are the details of the Netherlands’ ODA Budget?

The Dutch ODA budget for 2024 stands at EUR6.7 billion ( US$7.3 billion), a 0.14% increase from the 2023 ODA budget. The ODA/GNI ratio remained the same at 0.67%. The budget increase was driven by increased IDRCs. In March 2024, the Advisory Council on International Affairs published a letter recommending that the Netherlands ensures stable and predictable ODA. The Council specifically proposed the following:

• Maintain the link between ODA budget and GNI, adhering to the 0.7% goal;
• Stop adjusting the ODA budget based on new GNI forecasts; and
• Limit expenses for first-year asylum seeker care costs according to the Swedish model to a maximum of 11% of total ODA expenditure. Any remaining ODA could then be reallocated to cover deficits in other years, if necessary.

These proposals are however unlikely to materialize with the election of right-wing parties in 2023.

ODA is distributed across several ministries. In 2024, the MFTDC which sits under the MFA will manage 52.3% of the ODA budget. The MFA administers 21.6% of ODA while the Ministry of Justice and Security manages 19.5% of ODA. The Ministries of Finance and Education administer 5% and 1.4% of ODA, respectively. The remaining 0.2% is managed by ministries such as Agriculture and Health.

How does the Netherlands determine its ODA budget?

The Dutch fiscal year is the same as the calendar year.