U.S. Aid Much Lower Than Most Americans Believe

[ Although many in the U.S. suppose that the U.S. gives more than its share of development aid, this is a woefully inaccurate belief.

The United States gives little development assistance for its size, ties much of it to the purchase of U.S. goods and services, and allocates it to countries generally richer or more corrupt than recipients of development assistance from other donors.
Center for Global Development

–BL ]

Index Ranks Richest Nations’ Aid Contributions

27 April 2004 | NetAid.org

New York — In the second annual Commitment to Development Index (CDI), released yesterday by the Center for Global Development (CGD) and Foreign Policy (FP) magazine, the Netherlands and Denmark tie for the top spot for overall development aid, while the U.S., which ranked near the bottom last year, shares 7th place. The Index ranks the world’s 21 richest countries according to their their overall foreign assistance contributions, to overall foreign assistance as well as their to aid in seven individual categories including trade, migration and the environment.

Despite earning high marks for its trade policy, the United States contributes relatively little in foreign aid given the size of its economy. The U.S. contributes gives only 1% of total federal spending to development assistance. According to the Center for Global Development, this percentage is far less than the 24% in development aid the majority of Americans believe is given by the U.S. government.

While the Bush administration has set aside more funds for overall foreign aid in the new fiscal year, these increases have yet to be made a reality, and therefore, do not account for the jump in the country’s standing in this year’s index. In fact, according to the Center for Global Development, changes in standings are largely due to improvements to the index itself rather than changes in countries’ aid policies. The countries that jumped most in rank — Australia, Canada and the United States — gained from revisions to the migration component that filters out churning, as well as the shift to monitoring investment policies rather than investment flows.

Japan, the contributor with the second largest economy, finishes last, as it did in last year’s index. Poor scores for its trade and migration policies, as well as its low aid score, make Japan the least development-friendly nation on the index.

About the Commitment to Development Index: Moving beyond comparisons of foreign aid, the CGD/FP Commitment to Development Index also considers countries’ openness to exports from developing countries, as well as their performance in security, investment, migration, technology, and environmental policies. The index rewards generous and selective aid givingaid, tax breaks for private giving, sizable contributions to global security, incentives for foreign direct investment, hospitable policies for immigration, and robust support for technological research and development. It penalizes financial assistance to corrupt regimes and policies that harm shared environmental resources.

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