Policy Updates

On May 14, 2024, Australian Treasurer Jim Chalmers delivered the annual Australian budget, which showed the ODA budget rising slightly to AUD5 billion (US$3.2 billion) for FY2024/25.

0.19% ODA/GNI was expected in 2024. Notably, Australia included the grant element of concessional infrastructure loans in the overall ODA figures for the first time.

Within the ODA program, expenditure on the Pacific was expected to rise to almost 40% of the total ODA budget.

AUD144 million (US$93 million) was estimated to be spent on climate and the environment. A new Climate Resilient Communities Fund in the Pacific is slated to receive AUD100 million (US$65 million) over 3 years. Environment spending included AUD200 million (US$129 million) for a Pacific Resilience Facility over 4 years. An Indonesia Environment Partnership will receive AUD200 million (US$129 million) over 4 years.

The gender equality, inclusion, and disability sectors are estimated to receive AUD102 million (US$66 million), including for implementation of expected new strategies for gender equality, LGBTQI+ rights, and disabilities. This also included funds for an Indo-Pacific Gender Equality Fund and a Southeast Asia-based GBV prevention program.

On May 14, 2024, Norwegian government announced that it will increase support for Ukraine and Palestine in the proposed revised state budget for 2024 by NOK1 billion (US$92 million) each.

In addition, the budget will receive a further NOK100 million (US$9.2 million), making 2024 development assistance budget Norway's second-largest ever, corresponding to 0.98% ODA/GNI. The additional support to Ukraine and Palestine will be channeled through the UN, the Red Cross, and Norwegian humanitarian organizations.

In order to increase the funding to Ukraine and Palestine and to cover increased refugee expenses in Norway, the government is reallocating NOK1.6 billion (US$148 million) from other parts of the development assistance budget. The government proposed a reallocation from the health (NOK125 million; US$11.6 million), climate (NOK171.6 million; US$16 million), and civil society (NOK185 million; US$17 million) sectors.

The state guarantee scheme for renewable energy in LICs will also be postponed until 2025. The government underlines that the proposed reprioritization will not entail a breach of existing agreements.

On May 9, 2024, Australian Foreign Minister Penny Wong announced that Australia would provide AUD19 million (US$12 million) to extend the Tuvalu Coastal Adaptation Project, bringing the total Australian contribution to the project to AUD38 million (US$24 million).

The coastal adaptation project is one aspect of the Falapeli Union. Under this union, Tuvalu and Australia have agreed to an annual pathway for Tuvalu citizens to study, live, and work in Australia in response to climate change. Tuvalu faces climate challenges, with sea level rises likely to affect the whole nation. Increasing cyclonic events and rising sea levels threaten the nine inhabited islands of Tuvalu, which have an average elevation of only 1.83 meters.

In addition to the Australian funding, the project is receiving assistance through the GCF. It was the first project in the Pacific to be awarded assistance through the GCF.

Investments through the project will include improving the national ability to manage coastal protection responses as well as implement physical measures, including seawalls and rock and concrete revetments.

On May 9, 2024, UK Foreign Minister David Cameron spoke on UK foreign policy at the National Cyber Security Unit, where he highlighted that UK foreign policy is linked with ensuring the domestic prosperity and security and the UK's place in the world, noting that the UK is both large enough to make a significant impact but small enough to act nimbly and quickly when needed.

Cameron noted that the top priority for the UK is ensuring both British and global security, reiterating the UK government’s commitment to spend 2.5% of GDP on defense by 2030 and committing 5% of the spending to defense R&D.

Cameron went on to note that a close second priority was standing up for British values of freedom, human dignity and human rights and supporting the multilateral system that upholds these values. He highlighted how much more funding the UK provides to tackling malaria via the Global Fund than Iran, and how much more the UK spends than Russia on funding the UN Central Emergency Fund for humanitarian disasters. Cameron also emphasized the UK's generosity as a donor to the GCF to support oceans and biodiversity.

Cameron expressed pride in the UK’s recent International White Paper and its drive to support the UN SDGs, reform MDBs, and enhance cooperation with the private sector.

On May 8, 2024, during the African Fertilizer and Soil Health Summit in Nairobi, Kenya, Norway announced a NOK33 million (US$3 million) commitment to support the implementation of a ten-year action plan for improving soil fertility in African countries.

Norwegian Minister of International Development Anne Beathe Tvinnereim noted that the state of the African soil is at its poorest after decades of overexploitation, causing of micronutrients that are crucial for crops to thrive. Harvests grown in the poor soils have been negatively affected, contributing to the hunger crisis across the continent. Tvennereim noted that collecting detailed information about the current situation is a key delivery of Norwegian support.

The African Union Development Agency is planned to play a leading role in supporting the implementation of the African action plan at country level. The Norwegian support will be used on capacity building for policymakers and farmers, as well as facilitating regional knowledge exchanges. Part of Norway’s support will be a financial contribution to the creation of an open digital platform on soil health established by CGIAR and Varda. The platform aims to collect soil health data and make it available for policymakers, private sector, fertilizer producers, researchers, and farmers.

On May 7, 2024, Norad presented the statistics on Norwegian development assistance in 2023, showing that Norwegian ODA reached a record high of NOK58.6 billion (US$5.4 billion), an increase of 18% or NOK9 billion (US$832 million) compared to 2022.

ODA increased in all regions, significantly affected by the one-time additional allocation of NOK5 billion (US$462 million) to LICs particularly affected by Russia's full-scale invasion of Ukraine.

By region, the largest increase in ODA was to Europe. In total, European countries received NOK9.1 billion (US$842 million) in funding. Of the total European allocation, the largest share of funding went to Ukraine and Moldova. The funding to Ukraine in 2023 stood at NOK7.9 billion (US$730 million).

Development assistance to the African continent increased by NOK2.5 billion (US$321 million), reaching a total of NOK10.2 billion (US$943 million). Africa remains the region receiving the most development assistance from Norway. The increase in funding to Africa is explained by long-term assistance to agriculture, fisheries, food security and emergency relief.

Development assistance to the Middle East increased by over NOK1 billion (US$92 million), reaching NOK3.8 billion (US$351 million) in 2023. The increase was almost exclusively in emergency assistance. Palestine was the second-largest recipient of Norwegian development assistance in 2023, receiving NOK1.2 billion (US$111 million). The majority of the funding was given as humanitarian assistance and emergency relief.

By partner, multilateral organizations were the largest partner group for Norwegian ODA, followed by CSOs and the public sector. Multilaterals received NOK31.7 billion (US$2.9 billion) in 2023, an increase of NOK6.3 billion (US$582 billion) from 2022. CSOs received NOK13.2 billion (US$1.2 billion) in 2023, compared to NOK10.3 billion (US$952 million) in 2022.

The World Bank Group was the largest partner with NOK7.4 billion (US$684 million) in 2023, of which slightly over one-fifth was core support. The WFP was the second-largest recipient with NOK2.4 billion (US$222 million), approximately half of which was earmarked for emergency relief. Overall, multilateral organizations were the dominant partner group for Norwegian health assistance, with over 80% being channeled through multilateral partners in 2023.

By sector, emergency relief and multisectoral support saw the largest growth from 2022 to 2023, while there was a decrease in refugee expenses and earmarked assistance for education.

ODA to agriculture, fisheries, and food security significantly increased from NOK3.9 billion (US$360 million) in 2022 to NOK6.4 billion (US$592 million) in 2023. Most of the increase of NOK2.5 billion (US$231 million) was funded by the one-time funding package for LICs particularly affected by Russia's war against Ukraine.

Total Norwegian ODA to health stood at NOK6.5 billion (US$601 million) in 2023, up from NOK6.3 billion (US$582 million) in 2022. This is significantly lower than in 2020 and 2021, when development assistance globally was influenced by the Covid-19 pandemic.

Between 2014 and 2023, health assistance slightly increased when measured in 2024 prices, from NOK4.7 billion (US$434 million) in 2014. The largest partners in health assistance in 2023 were Gavi at NOK1.5 billion (US$138 million), UNFPA at NOK1.1 billion (US$101 million) and the WHO at NOK687 million (US$63.5 million). Of the earmarked health ODA, totaling NOK3.5 billion (US$323 million) in 2023, 58% went to programs targeting LICs not geographically earmarked. Africa received the most of the geographically earmarked health support, with around NOK600 million (US$55.5 million).

In 2023, NOK1.7 billion (US$157 million) went to SRHR, down from NOK1.8 billion (US$166 million) in 2022. Multilateral organizations, an important partner group in Norwegian SRHR efforts, received 51% of the earmarked support in addition to the calculated core support, totaling 81% of SRHR support. UNFPA was the largest individual partner and received nearly half of total SRHR support.

On May 3, 2024, Canada announced CAD65 million (US$48 million) in international assistance funding to Lebanon, including CAD38 million (US$28 million) in development assistance funding and CAD27 million (US$20 million) in humanitarian assistance funding.

The humanitarian assistance will help provide WASH services, health care including SRH services, and protection services including for survivors of SGBV.

The development funding includes:

• CAD20 million (US$15 million) to the UN FAO to improve the capacities of farmers and increase food security in response to climate change and economic shocks;
• CAD13 million (US$10 million) to UNDP to improve the economic security and prosperity of women-led micro-, small-, and medium-sized enterprises in sectors with high growth and export potential; and
• CAD5 million (US$4 million) to UN Women and UNDP to address barriers facing women’s representation in decision-making and leadership positions, specifically for women in parliament and municipal councils.

On May 3, 2024, Australian Minister for International Development and the Pacific Pat Conroy announced a pledge of AUD492 million (US$317 million) to the Asian Development Funds’ 14^th pledging round, covering the period of 2025–2028.

The low-interest financing arm of the ADB focuses on grants to lower-income countries. Conroy emphasized the value of these grants to regional needs such as climate resilient hospitals and education facilities, as well is improving the systems that run them.

Conroy indicated Australia had worked with representatives from Kiribati and the Cook Islands to ensure that more funding would be received by the Pacific. An increase of over AUD500 million (US$323 million) was expected for the Pacific, compared to the previous replenishment.

Australia has also pursued arrangements to ensure access to finance for people in Afghanistan, Myanmar, and the Rohingya refugee population in Bangladesh, particularly women and girls. Australia urged the ADB and the World Bank to improve their procurement processes by avoiding approving artificially low-priced, poor-quality projects where higher prices were later demanded during implementation. Conroy encouraged tender processes to focus more strongly on quality and value for money and expressed concerned that low bid prices were discouraging a broader range of bidders from seeking work, particularly in the Pacific countries.

Australia is the second-largest contributor to the fund, behind Japan.

On May 2, 2024, the UK government responded to the ICAI, the UK’s aid watchdog, recommendations for tackling fraud in UK ODA funding.

The FCDO thanked ICAI for reviewing the UK's approach to combating fraud in ODA funding released earlier in 2024. The FCDO partially accepted ICAI’s first recommendation to take a more robust and proactive approach to anticipating fraud. The FCDO noted that it was actively exploring the cost-effectiveness of creating an FCDO Fraud Intelligence Unit and was expanding its Fraud Liaison Officers’ Network to strengthen oversight.

The FCDO also partially accepted the second recommendation to strengthen its fraud in its top 20 ODA recipient countries, noting that it will reinforce the mandatory annual assurance assessment across control and risk areas and expand its Fraud Liaison Officer's network.

The FCDO fully accepted the final two recommendations, which called for new fraud management guidance to be written for capital investments and to increase the Head of Mission’s oversight and accountability for fraud risks relating to centrally managed and other government programs.

On April 30, 2024, it was announced that, as a part of the G7 Finance Track, the Italian MEF and ISTAT will host the seventh edition of the OECD World Forum on Wellbeing, entitled Strengthening Wellbeing Approaches for a Changing World, in Rome from November 4-6, 2024.

The event is part of the G7 Finance Track promoted by the Italian government. The Forum will be structured into five round tables that will discuss topics, including:

• The development of policy frameworks oriented towards equitable and sustainable well-being;
• The measurement and statistical methodology, as well as the analysis of well-being indicators;
• Climate change;
• Technological innovation and the use of artificial intelligence; and
• The next steps in the well-being agenda.

Other topics to be addressed include gender inequalities, inequalities and poverty, physical and mental health, and the aging population.