Swiss development aid: Used better than in Germany and Austria

Savings are the order of the day as public finances in Switzerland are in danger of getting out of hand. The cost cutting efforts will also focus on spending on development aid. First, this must be related to the fact that this item is one of the unrestricted charges. So development aid can be changed quickly and without revising the law, which is the case with only one third of federal spending. Second, development aid has a relatively weak political lobby, the effectiveness of which has been debated for decades.

One term, many definitions

Also the group of experts appointed by the Federal Council under the direction of Serge Gaillard that does not exclude development support from his savings package of about sixty degrees. Although direct reduction is not recommended. However, it is recommended that spending on international cooperation – including aid to Ukraine – will not be allowed to increase further until 2030. According to the expert group, if spending were frozen at the 2025 planning level , a total of 313 million francs could be saved.

It goes without saying that the development organizations oppose this. In order to justify their opposition, the question arises: How generous is Swiss development aid in international comparison? ? And is the money used wisely? Gives a possible answer Global Cooperation. In a policy paper, the Swiss think tank examines how the composition and operation of development aid differ in the neighboring countries of Switzerland, Germany and Austria.

The authors of the study are not completely unbiased. So fight Global Cooperation against budget cuts in development aid. What quickly becomes apparent when comparing countries is that all sorts of different things are included under the general term of development aid (Official Development Assistance, ODA). The OECD defines it as Development Assistance Committee (DAC) minimum standards for what can be reported as ODA. Nevertheless, the member states have a lot of room for interpretation.

A lot of money stays at home

So the same is not very sensible Comparison of development aid budgets. These are usually expressed in terms of gross national income (GNI), with the UN target level at 0.7 percent of GNI. Of the three countries, only Germany exceeded this level in 2023, which was the fourth largest donor among the 32 OECD countries with an ODA quota of 0.79 percent. Switzerland is in eighth place with a rate of 0.6 percent, Austria is a distant fifteenth place with 0.38 percent. The Swiss rate has risen steadily from 0.44 percent in 2018.

But that does not mean that Germany provides the best ODA ahead of Switzerland and Austria. What is important is less the content and more the composition of the aid. And there are big differences. A lot of money can be counted as ODA, even money that never leaves the country. These include, for example, accommodation costs for refugees in the donor country, as well as costs for students from developing countries who study at universities and colleges in the donor country, which as well as debt relief.

Austria allocates domestic payments particularly generously to development aid. The study costs for people from receiving countries studying in Austria make up 20 percent of the total development aid. Students from countries such as Bosnia-Herzegovina and Turkey are particularly important. It is doubtful what this has to do with ODA, says Coopération Globale. In Switzerland, however, research costs are not counted towards ODA; in Germany they make up 7 percent of the budget.

Asylum costs are also development aid

In order to avoid such controversial expenditure, it is advisable to look at those development funds that cross borders and are part of a multi-year development program. With this kind of help, the ranking looks different: Switzerland is at the top, ahead of Germany and Austria, which are far behind. In other words: Measured in terms of economic strength, Switzerland pays less development aid than Germany, but a higher proportion of it reaches the recipient country.

Nevertheless, a significant portion of Swiss development aid is still in the country. High the Directorate for Development and Cooperation (DDC) This is largely related to domestic asylum costs, some of which can be offset against ODA. If you take these out, the ODA of about 4.6 billion francs in 2023 falls from 0.6 percent to 0.43 percent of GNI. Almost a third of Switzerland’s development aid goes to asylum costs incurred at home.

Development organizations like Alliance Sud criticizes this practice. It is said that the expenditure on refugees in Switzerland is used to protect people, but it has no effect on development policy and does not contribute to reducing poverty in the south. In this context, it is also criticized that the Federal Council is an IC strategy (2025–2028) wants to reserve 1.5 billion francs for Ukraine. On Wednesday, however, the Council of States supported this movement for reconstruction in Ukraine.

Almost no help is attached

Nevertheless, Switzerland stands out positively in many areas compared to its neighbors, as an analysis by Coopération Globale shows. One example is the importance of “tied aid” in Switzerland. This help especially feared by development expertsbecause it is linked to the requirement that the recipients use the money received to buy goods and services from the donor country. Research shows that such requirements increase the cost of development projects by 15 to 30 percent.

The OECD Development Assistance Committee therefore asks donors not to provide their aid under such conditions. This is also because development aid goes into a form of state export support and the beneficiary countries cannot benefit from any price advantages on world markets. In Switzerland this is taken to heart: only 3 percent of aid in this country is tied In Germany the proportion is 18 percent and in Austria it is as much as 40 percent of development aid.

Switzerland also does better by focusing on the poorest countries. Such a focus is recommended because one franc of ODA can usually have a greater impact in a very low-income country than in a very rich emerging country. there are other sources of finance as well. Switzerland spends 24 percent of its bilateral development aid on the least developed countries. In Germany, where a high proportion of development aid goes to China, the proportion is 13 percent, as in Austria.

One-sided focus on the input

The comparison proves why Swiss development aid has a good reputation far beyond the country’s borders. This has less to do with the total amount than with the judicious use of the money. Nevertheless, political discussions on the subject are largely focused on input rather than output. Anyone who achieves the target of 0.7 percent of GNI will receive a commendation; Anyone who remains below this level will be asked to make improvements. A look abroad shows that this falls short. More help does not equal better help.