Moving beyond international aid intermediaries

The international aid system is in need of reform. Despite rhetoric about localisation, a meagre 1.2% of international humanitarian aid directly reaches local actors. Overall, there is a lack of transparency and awareness in international policy circles on how funds flow from the donor level to the field. This brief argues that the issue is not just about a lack of capacity on the part of local actors—a sweeping statement often used by western aid stakeholders to justify their marginalisation. Donors also need to reform their understanding of aid, accept to share power with Global South champions of change, and increase their own capacities to adapt to local development and humanitarian systems. The brief explores, in this regard, the potential of the non-profit incubation model.

In December 2023, the United Nations Climate Change Conference convened in Dubai to discuss global strategies and actions to ensure a sustainable future for all in the face of worsening climate change. As policymakers attempt to finance and implement the global green transition, international assistance actors, such as international NGOs and private development companies, are striving to integrate environmental components into their programmes aimed at addressing security, development, and other humanitarian crises in the Global South.

However, there is little focus at the strategic level on how international assistance continues to be dominated by western stakeholders such as government agencies, multilateral organisations, international NGOs, and private international development companies, who tend to marginalise local actors of change. These are the NGOs, informal civic associations, and social entrepreneurs working towards the same objectives in the Global South. To be sure, international donors have invested, over the past 60 years, trillions of US dollars in aid in various domains—from development to peacebuilding and humanitarian action. Yet, the overall amounts of international aid continue to be insignificant compared to the financing needs for the green transition—estimated at a minimum of $5 trillion per year, compared to the current $2 trillion global annual investment—or to achieve the United Nations Sustainable Development Goals. Nonetheless, despite the investment made through aid, the sector has continuously failed to spur sustainable and locally rooted positive change in target countries, despite encouraging rhetoric about localisation which, in practice, struggles to elevate bottom-up approaches. More than ever, it has now become critical to overhaul the dominant international assistance model to encourage sustainable development by putting power and decision-making in the hands of those in need of funding.

The paper can be accessed by clicking here.

This article is authored by Aude Darnal, ORF.