Vice-Chair of the Euro-Mena Initiative for Democracy and Development and Senior Advisor on Access to Justice and Inclusive Social Protection at ARDD´s Renaissance Strategic Center.
In the wake of President Donald Trump’s sweeping suspension of US foreign aid, global development efforts face an unprecedented crisis. The United States, historically one of the world’s largest donors, through USAID and other programs, has effectively halted humanitarian and development assistance arguing that it is realigning foreign aid with national interests. The ripple effects are already being felt in conflict-affected regions and across the Global South. These actions have sparked significant controversy and concern among US lawmakers and humanitarian organizations. Critics argue that dismantling USAID could undermine US foreign policy objectives and weaken global humanitarian efforts.
For many, the obvious expectation is that the European Union (EU) and its member states, along with like-minded states, would step in to fill this void. As the world’s second-largest aid provider, the EU has long positioned itself as a leader in global development, promoting human rights, poverty eradication, and sustainable economic growth. Think tanks and policy experts have urged the EU to enhance its role, arguing that stepping up is not only a moral imperative but also a strategic necessity to maintain stability and counter the growing influence of geopolitical rivals like China.
While the EU might seem like the natural successor to a retreating United States in the development sector, recent trends suggest that it is far from ready to assume this role. Foreign aid budgets across Europe are in free fall, with public spending cuts becoming the defining economic policy of 2024.
Traditionally generous donors are scaling back: Germany, facing political turmoil and the rise of the far-right Alternative for Germany (AfD), announced a EUR 4.8 billion cut to development and humanitarian spending; France, once a vocal advocate of increasing Official Development Assistance (ODA), has slashed EUR 800 million from its foreign aid budget in 2024 alone; the Netherlands, under a newly formed right-wing coalition, is set to trim its development aid budget and drastically reduce funding for international civil society organizations.
At the EU level, a comprehensive financial review last year led to significant reallocations in aid spending. Instead of increasing the external action budget as initially proposed, member states chose to redeploy EUR 2 billion from existing development funds to finance migration-related activities in the southern Neighborhood and support Syrian refugees in Türkiye, Jordan, Lebanon, Iraq, and Syria. This reallocation resulted in a 7.48 per cent cut across EU aid budgets for 2025-2027, potentially undermining the EU’s capacity to respond to future crises and support multilateral organizations.
Another cause of concern is the EU’s declining commitment to the world’s most vulnerable nations. According to OECD data, the share of European Commission aid allocated to Least Developed Countries has fallen from 52 per cent in 1990 to just 19 per cent in 2022. This trend stands in stark contrast to the rhetoric of European policymakers who continue to champion the EU as a global leader in development assistance.
The bloc is trapped in a paradox: while the need for global development funding has never been greater, the political and economic will to sustain such efforts is eroding. The rise of nationalist and far-right parties across Europe has fueled public skepticism toward foreign aid, undermining financial and political support to international organizations engaged in development efforts. This political resistance has made it increasingly difficult for governments to justify robust aid budgets, particularly as xenophobic narratives gain traction among voters. At the same time, economic slowdowns, rising debt, and inflation have placed severe pressure on national budgets, leading to fiscal tightening across the board. In this context, development aid has become an easy target for cuts, often framed as an unnecessary expense rather than a long-term investment in global stability and the promotion of a rights-based order.
The surge in military spending and direct financial support to Ukraine has placed further constraints on available resources for development assistance. As European governments are asked to prioritize defense budgets in response to the war, the cumulative effect of these budgetary pressures raises concerns about whether Europe’s development agenda will continue to hold its ground or be further displaced by immediate geopolitical and security concerns.
Compounding these challenges is the EU’s increasing tendency to leverage development cooperation as a tool for migration management. Migration policymakers often seek to utilize development aid to control migration flows, while development experts argue that such aid should primarily focus on achieving the Sustainable Development Goals (SDGs). This shift in focus has led to resources being redirected toward immediate political concerns, particularly those related to migration management, at the expense of long-term initiatives aimed at poverty alleviation, human rights, and governance. Consequently, funding for these critical areas is steadily diminishing, raising concerns about the EU’s commitment to its development objectives.
As the EU navigates economic constraints and shifting political priorities, the decline in its development assistance is not merely a financial setback, it represents a fundamental shift in the very nature and purpose of foreign aid. The vacuum created by the US withdrawal from a rights-based global aid and Europe’s internal struggles is a moment of reckoning for the principles that underpin development cooperation. China’s state-driven, infrastructure-heavy model is increasingly filling this gap, offering recipient countries an alternative that prioritizes economic expansion while largely bypassing governance reforms, civil liberties, and accountability. From a rights-based perspective, this is not simply a matter of global power competition, it is a paradigm shift that threatens to displace the human-rights-centered approach that should define development aid.
If European policymakers continue deprioritizing rights-based assistance in favor of short-term geopolitical and migration-related goals, the global balance of influence will shift toward a model where economic growth is pursued without democratic governance, social justice, or citizen empowerment. The question at hand is no longer just about financial allocations: it is about the future of development itself. Will the EU recalibrate its approach to uphold its commitment to rights-based aid, or will it allow its influence to diminish, leaving human rights as collateral damage in the evolving global aid order?
The EU has long prided itself on being a champion of multilateralism and international cooperation. But rhetoric alone will not be enough to address the funding crisis now looming over the global development sector. If European leaders are serious about filling the void left by the United States, they must not only reverse their own downward trend in aid contributions but also develop a comprehensive strategy to ensure that development assistance remains a pillar of European foreign policy.
To achieve this, the EU must:
• Reaffirm its commitment to ODA targets, ensuring that the most vulnerable nations do not bear the brunt of budget cuts.
• Strengthen collaboration with like-minded partners to create a more resilient global aid network.
• Address domestic political resistance by making the case that development aid is not charity but a strategic investment in global stability and security, and the future of humanity.
The next few months will be critical. Will the EU rise to the challenge, or will it allow the world’s most vulnerable to fall through the cracks?
* This blog was published on February 06, 2025, at “Development Today”
