US

Summary

ODA Spending

How much ODA does the US contribute?

The US is the largest donor country in absolute terms, with ODA at US$60.5 billion in 2022.

Relative to economic size, the US’ ODA is low, at 0.24% of GNI, placing the US in 25^th among OECD DAC members, falling from 22^nd in 2022.

The US aligns with the DAC statistical directives and ODA definition. However, the US' definition of 'foreign assistance' is broader and includes non - ODA eligible items such as military assistance, although there are significant gaps in Department of Defense reporting. The difference between ODA and foreign assistance reporting is highlighted in this table.

How is US ODA changing?

US ODA has jumped considerably since US President Joe Biden took office in January 2021. In 2021, total ODA increased by 29% compared to 2020, up from a 5% increase in total ODA from 2019 to 2020. During his time in office, President Biden has reinstated the US as a primary donor and global leader on support for global health initiatives. He rejoined the WHO, pledged support to the Access to COVID-19 Tools Accelerator ACT-A, and joined its COVAX Facility. In the climate space, he also recommitted to the Paris Accords and has pledged significant funding for climate programs, which some of which has not been supported in the final appropriations.

ODA increased by 8% in 2022, mainly due to support to Ukraine as well as increased costs for in-donor refugees. US$6.6 billion of their funding went to in-donor refugee costs, equivalent to 12% of total ODA, a massive 340% increase from the US$1.5 billion allocated in 2021. Bilateral support to Ukraine accounted for an additional 16% of total ODA in 2022. The final enacted figure for FY2023 was US$61.7 billion (not including emergency funding), which represented a 6% increase over FY2022. In April 2024, Congress passed a US$95 billion national security emergency funding bill for Ukraine, Israel, Taiwan, and Gaza and other partners, of which US$26.8 billion is for economic and humanitarian assistance.

The Biden Administration’s March 2024 FY2025 budget request for the International Affairs Budget, released on March 12, 2024, was US$64.4 billion in discretionary funding (regular, non-emergency funding and base emergency funding). The final FY2024 enacted figure was US$60 billion, a US$3.7 billion (6%) cut from FY2023 levels. Passage of the FY2024 appropriations bills were held up for months, passing over six months after the start of the fiscal year on October 1, 2023. Funding levels were lower due to an overall spending agreement reached between House and Senate leaders in January 2024.

In Biden’s FY2025 budget request, global health faced the largest cuts with the US' contribution to the Global Fund cut down from US$2 billion to US$1.2 billion, largely because US law limits US contributions to no more than one-third of all funding from other donors. Other key areas, such as humanitarian, economic and development spending, and security assistance, were largely held flat, while funding to counter China and Russia received additional funding. Food security, climate change, and gender all received increases in the President’s budget.

Where is US ODA allocated?

The US channeled 86% of its total ODA bilaterally in 2022, far above the OECD DAC average of 59%. Historically, US Congress favors bilateral assistance as it allows congress to have greater control in how US foreign assistance is spent. FY2023 enacted levels, however, did provide for a small increase in multilateral funding.

Bilateral Spending

US bilateral ODA is provided entirely in the form of grants. In 2021, the US distributed 30% of its bilateral ODA funding through the public sector ( DAC average: 44%), 23% as earmarked funding through multilaterals, which is considered bilateral ( DAC average: 26%), and 21% through NGOs and CSOs ( DAC average: 17%). The Biden Administration is prioritizing locally led development and USAID has set a target to have 25% of its funding going to local partners by 2025, though this target is not likely to be reached. The US focus on grants over loans is to ensure that US development money is directed to the most vulnerable.

The largest share of US bilateral ODA went to ‘health and populations,’ which overtook 'humanitarian aid' for the first time since 2018. The sector with the largest jump in ODA was ‘refugees in donor countries,’ which has seen just short of a five-fold increase between 2020 and 2022.

President Biden’s proposed FY2025 proposed budget cuts foreign assistance by about US$6 billion over his FY2024 request. Global health funding was cut by the largest amount due to cuts to the Global Fund (US$2 billion to US$1.2 billion) because of declining funding from other donors; US law limits US contributions to no more than one-third of all funding from other donors. Other heath funding levels were kept flat or slightly increased. Humanitarian and refugee assistance was set at US$10.3 billion and democracy, human rights, and governance levels were proposed at US$3 billion. Gender and PREPARE both came in at US$3 billion. The GCF received US$500 million, although Congress has not funded it at all in recent years.

Multilateral Spending and Commitments

As a result of its focus on promoting national interests and strengthening bilateral relationships, the US channels a lower share of its total ODA to multilateral organizations than other OECD DAC donors. Core contributions to multilaterals accounted for 14% of the US’ total ODA in 2022, well below the DAC average of 41%. In absolute terms, the US became the top provider of core contributions to multilaterals in 2021. Overall, the Biden Administration has reengaged with the multilateral system. The FY2024 final appropriations had a 7% increase in contributions to International Organizations, allowing the US to fully meet its obligations. The FY2025 budget proposal also full funding of US obligations. However, voluntary contributions from FY2023 to FY2024 received a cut of 14%. The FY2025 budget also requested a modest decrease.

Politics & Priorities

What is the current state of US politics?

The US is a constitutional federal republic, where powers reserved for national government are shared between independent branches of government: the executive branch, which is headed by the president; the US congress, and the judiciary. The president, currently Joe Biden (Democrat) since January 2021, sets overarching policy orientations for US foreign assistance, including for development. Development policies and priorities are also defined by the US congress, including the two chambers, the House of Representatives and the Senate, which have a final say on federal spending, including foreign assistance.

Within the executive branch, the US Department of State is responsible for foreign policy and diplomacy and works with USAID on development policy setting. USAID is largely responsible for implementation of US global development programs. Under President Biden, development has been given a more elevated role alongside defense and diplomacy, including naming the USAID Administrator as a principal in the NSC.

Main Actors

What are the US' development priorities?

The Biden Administration views global development as tied to diplomatic and defense priorities. President Joe Biden released an Interim National Security Strategic Guidance document in March 2021, outlining priorities for his administration’s global footprint, including:

• Decisively responding to the public health and economic crises triggered by COVID-19, including global health security;
• Reinvigorating and modernizing the US’ global alliances and partnerships;
• Moving swiftly to earn back the US’ position of leadership in international institutions to tackle shared challenges, including the climate crisis; and
• Revitalizing the US commitment to democracy.

These sectoral priorities are more clearly outlined in the State Department and USAID JSP 2022-26. Under the plan, the US government commits to “race to end the COVID-19 pandemic, help nations adapt to climate change, fight corruption and authoritarianism, reduce poverty, enhance food security and nutrition, improve health and education, prevent conflict, protect human rights, promote equality, and provide lifesaving assistance during crises.”

USAID released its revised Policy Framework in March 2023, which serves as a guide for driving progress through and beyond its programming. The framework is USAID’s highest-level policy document. It orients development aims for USAID and the US government; aligns national security and foreign policy goals with development objectives; and provides cohesion among the development, humanitarian, and crises response work of the agency and its partners.

On top of reaffirming the 2030 Agenda for Sustainable Development and the SDGs, the three overarching priorities of the Policy Framework are:

• To confront the greatest challenges of our time;
• To embrace new partnerships; and
• To invest in USAID’s enduring effectiveness.

The framework defines 'greatest challenges' as responding to complex crises including conflicts and food insecurity, addressing climate change, countering rising authoritarianism and supporting democracies, strengthening global health and health security, addressing economic headwinds, and promoting inclusive growth.

Also in March 2023, USAID released its long-awaited Acquisitions and Assistance strategy, which governs how the agency spends about 85% of its funding. The strategy lays out three new priorities for awarding USAID contracts:

• The agency will continue its work to strengthen its workforce, hiring more contracting offices, agreement officers, and more local staff with authority to award contracts;
• USAID aims to decrease the time it takes to award contracts more than US$25 million; and
• The agency will diversify its partner base through reducing barriers for new partners, increase outreach to the private sector, and expand the ability of USAID to work with local partners.

Experts stated that the third pillar would be critical to achieving USAID's ambitious targets for increasing locally led development.

By issue

Global health: Global health is a priority sector for the Biden Administration and, as the US remains the largest global health donor. However, overall budget constraints, small cuts to global health security, and lower donor contributions to The Global Fund have resulted in overall decreases in global health in FY2024. Biden’s FY20254 budget proposal requests slightly less than FY2024 for global health, although most is due to the Global Fund, a funding situation which could change if other donors increase their contributions. Overall, other global health programs remain either flat or received a slight increase.

Read more about US’ ODA to Global Health

Climate: Biden has made climate a top priority. In his April 2021 Leaders’ Summit on Climate, Biden announced that the US would double climate finance for LICs by 2024. He also elevated the role of US Special Presidential Envoy for Climate to a cabinet position. In late 2021, USAID released a draft climate change strategy, which sets performance targets for 2030 on climate, including CO2 reduction and putting US$150 billion in public and private sector funding toward addressing climate change. Funding for climate programs in the International Affairs Budget, which are largely cross-cutting, are not detailed. However, funding levels between FY2023 and FY2024 remained essentially flat, including for the Clean Technology Fund and the Global Environmental Fund. Once again, there was no specific allocation for the Green Climate Fund, but the State Department is permitted to make a US contribution.

Read more on US' ODA for Climate Change

Gender equality: Gender has gained greater attention under Biden. He has elevated a representative for gender equality to a cabinet-level position for the first time, established a White House Gender Policy Council within the Executive Office of the President, and released the first-ever US National Strategy for Gender Equity and Equality, which applies to both US domestic and international policy. The FY2024 levels remained essentially at FY2023 levels, including US$250 million for GBV, US$150 million for Women, Peace, and Security Strategy, and US$200 million for the Gender Equity and Equality Action Fund. The FY2025 budget requested a 15% increase in gender accounts.

Read more on US' ODA for Gender Equality

While agriculture and education are key sectors for the US, neither are considered top-level within the new JSP 2022-2026. Food security, however, has consistent bipartisan congressional support and is a high priority for the Biden Administration. However, FY2024 enacted levels cut international food programs by 6%.

Read more about US’ ODA for Agriculture

Read more about US’ ODA for Education

By region

See charts under the Bilateral Spending section for greater recipient and regional distribution detail.

The US concentrates its bilateral ODA on sub-Saharan Africa. Between 2018-2022, the US provided an average of US$11.8 billion (35% of bilateral ODA) to the region per year, followed by the MENA region, with US$4.2 billion or 13% of bilateral ODA during that time, and Asia, with US$3.8 billion or 11% of bilateral ODA during that time.

Under the Biden Administration, SSA will remain a high-priority region. Biden reinforced this aim by calling the US - Africa summit in December 2022, which brought together a number of African leaders and top level members of his administration to create and expand partnerships across the African continent to cover a range of issues including food security, climate change, health care and pandemic preparations, inclusive economies, good governance, human rights, and peace and security. The summit resulted in a total of US$55 billion in commitments to the continent from the US over 2022-2025.

Since the beginning of the Russian invasion of Ukraine on February 24, 2022, the US has provided over US$13 billion in direct budget support, including for healthcare, education, and emergency response. In addition, US$1.4 billion has been provided in humanitarian assistance and over US$800 million in development assistance, which will bolster Ukraine’s energy grid, governance institutions, agricultural production, small businesses, and civil society. In total, Europe received 19% of US ODA in 2022, up from 2% in 2021.

The FY2024 appropriations and the FY2025 budget proposal continued to support efforts to implement the Administration’s Indo-Pacific strategy and efforts to counter and out compete China, both of which saw an increase from FY2023 levels. The FY2025 budget proposal also includes US$1 billion to the IBRD in loan guarantees and grants for the World Bank to offset what is considered coercive lending by China.

Budget

What are the details of the US' ODA budget?

The overall US foreign assistance funding level for FY2023 (October to September) was enacted at US$61.6 billion in non-emergency funding and US$2.1 billion in base emergency funding. That figure excludes the approximately US$19 billion in emergency funding, which primarily went to Ukraine. FY2024 enacted totals were US$57.5 billion for non-emergency funding and US$2.5 billion in base-emergency funding. The FY2025 totals includes US$64.4 billion in non-emergency funding.

The US does not have a dedicated ODA budget. Rather, the federal budget is divided into budget ‘functions’ that include all spending on an issue, sourced from various appropriations bills. Almost all development-related spending is within Budget Function 150, commonly referred to as the IAB, which includes ODA-accountable funding and non - ODA money, such as operating embassies, military assistance, and promotion of US exports.

ODA spending does not necessarily reflect the most current obligations and expenditures for US foreign assistance. A good source of detailed funding is ForeignAssistance.gov, which allows analysis of funding by agency, sector, type of funding, region, and other breakdowns.

The vast majority of funding included under international affairs comes from the SFOPS appropriations bill, with the remainder sourced primarily from the agricultural appropriations bill for food security and food-assistance funding.

The SFOPS bill is divided into ‘titles,’ each covering a different budget envelope (see the table below). The money in these envelopes is mainly, but not exclusively, managed by the State Department and USAID. Relevant titles related to global development include:

• Title I: Department of State and Related Agency largely funds the management and running of the State Department. It also contributes to the US’ assessed contributions to 44 international organizations, including the UN regular budget and its specialized agencies.
• Title II: Administration of Foreign Assistance provides operational funds for USAID.
• Title III: Bilateral Economic Assistance covers much of the US’ foreign assistance and development activities, accounting for just under half of the entire SFOPS. The largest share goes to global health. Programs funded under Title III are jointly managed by the State Department and USAID. Most funding is channeled through the ‘Development Assistance’ envelope, which is broadly intended to foster economic progress and social stability in partner countries, and the ESF, which provides assistance to allies and countries in transition to democracy, support the Middle East peace process, and finance economic stabilization programs.
• Title V: Multilateral Assistance includes money for US voluntary contributions to various multilateral organizations, including to the World Bank and global environmental funds.

This table excludes emergency funding.

How does the US determine its ODA budget?

The US fiscal year runs from October 1 to September 30. The budget process begins 12 to 14 months, or more, prior to the start of the fiscal year. Most federal spending consists of ‘mandatory spending’ and ‘discretionary spending;' foreign assistance falls under discretionary spending. The budget process for discretionary spending can be categorized into three separate phases: 1) development of the president’s budget request, 2) congressional budgeting, and 3) congressional appropriations.

This timeline has become increasingly variable in recent years due to political deadlocks, often resulting in continuing resolutions that extend the fiscal year and that keep the government funding running while an agreement is reached.

Phase 1: Development of the president’s budget request (May - February) Government departments and agencies begin developing budgets in May and submit funding requests in September/October: From May to September, departments and agencies develop their budgets and set broad parameters for spending on specific programs. The USAID and the State Department, for example, negotiate major funding levels and policy decisions for each budget line and then share the proposal with the White House’s OMB. From September to November, OMB negotiates funding levels with the heads of government departments and agencies. Engagement with OMB from August to September is important. At this time, it can receive external input to inform its engagement and negotiation with departments and agencies.

Under normal circumstances, negotiations can take between two and four weeks before the OMB officially passes back the budget request for agency review. In recent years, this stage has taken months rather than weeks, delaying the release of the budget request.

OMB works to finalize budget request in late fall and president submits it in February: In November/December, the OMB finalizes the budget request before the president signs off in late December/early January. Traditionally, the president submits his budget request to Congress the first Monday in February. This date is often delayed, particularly when a new administration takes office.

Phase 2: Congressional budgeting (February - April) Congress sets spending limits for main budget areas: Once the president’s budget request is submitted to Congress, the CBO evaluates the request. The House and Senate then each develop, debate, and (in theory) pass a joint congressional budget resolution before April 15. The resolution sets the overall level of discretionary funding for the next fiscal year. This ceiling or “budget cap” is sent to the House and Senate Appropriations Committees. Unlike the president’s budget request, which is a detailed proposal – the budget resolution is a short, high-level document. It is not a bill that is signed into law, but instead provides the binding budget cap that appropriators use to allocate discretionary spending. The president’s budget request is a key opportunity for advocates to engage in discussion on the foreign affairs budget with key stakeholders including with Congress, government agencies and departments, and the White House, through meetings, letters, and media outreach.

Phase 3: Congressional appropriations (April - September) Congress considers appropriations bills that allocate funding to government functions, including foreign assistance, from April 15 to September: After the final budget resolution is agreed upon, or after April 15 (whichever comes first), Congress must draft, debate, and pass 12 different appropriations bills, which correspond to different government functions. This includes the appropriations bill for SFOPS, which funds most development programs (see ‘Budget’). During the spring, each of the relevant committees and subcommittees hold several hearings on the president’s budget request to debate, amend, and rewrite or “mark-up” the appropriations bills. Prior to this phase, there are several advocacy opportunities, including meetings on Capitol Hill, letters to Appropriations Committee chairs, events, and participation in hearings.

House and Senate negotiate final budget; president signs: Once an appropriations bill has passed the House and Senate, a conference committee is formed with representatives from the Appropriations Committees to negotiate the differences between the House‐ and Senate-passed bills. If the House and Senate cannot find an agreement by the end of September, Congress needs to enact an emergency short-term measure – usually a ‘continuing resolution’ – to provide temporary funding to ensure the government continues to operate while the appropriations bills are finalized. Any spending bills are then sent to the president for approval or for veto; vetoes are rare and require an override from two-thirds of both chambers of Congress.