Time for a Reset: Development Cooperation at the Crossroads

The report argues that the traditional Official Development Assistance (ODA) model is outdated and failing to meet 21st-century challenges. It identifies six key pressures: shifting poverty geographies, rising demands for climate and health financing, fragmentation from new actors, changing flow natures, geopolitical rivalries, and declining public trust. The author contends that incremental tweaks are insufficient and proposes a 'reset' that integrates ODA into a broader Global Public Investment (GPI) framework. This new architecture would distinguish core poverty reduction from global public goods financing, reform governance to include the Global South, and shift the narrative from donor-driven charity to mutual interest. The report outlines five future scenarios for 2040, ranging from 'Incremental Change' to a 'Managed Handover' to non-governmental actors, urging policymakers to proactively shape a transition to avoid a fragmented 'Wild West' of bilateralism.

• The traditional binary division of 'rich' and 'poor' nations no longer reflects the reality of global poverty, as extreme poverty is increasingly concentrated in fragile and conflict-affected states and middle-income nations.
• ODA budgets are being stretched thin by the need to fund global public goods, with approximately one-third of global aid now directed toward climate objectives, which reduces funding for core poverty reduction.
• The development cooperation landscape is highly fragmented due to a proliferation of actors and a decrease in the average size of ODA transactions, which increases costs for recipient countries.
• A significant portion of ODA is captured within donor countries to cover administrative costs and refugee support, which undermines the legitimacy of aid and reduces the amount reaching the poorest countries.
• Debt service payments are increasingly outpacing aid inflows in developing countries, with net financial transfers falling from USD 225 billion in 2014 to USD 51 billion in 2024.
• The institutional authority of the OECD Development Assistance Committee (DAC) is eroding as recipient countries find the pragmatic, infrastructure-focused lending of non-DAC donors like China more aligned with their needs.
• Public support for ODA is declining in donor countries due to right-wing populism and domestic needs, while recipient countries increasingly demand reparations over charitable grants.
• The report proposes a transition to a Global Public Investment (GPI) framework based on mutual interest, which would replace the donor-driven ODA narrative and utilize a multi-tiered system for different types of financing.
• The author identifies five hypothetical scenarios for development cooperation by 2040: Incremental Change, Fragmented Bilateralism (the 'Wild West'), Universal Development, Pragmatic Pluralism, and Managed Transition.

APA

Reid-Henry, S. (2025). Time for a Reset: Development Cooperation at the Crossroads. Peace Research Institute Oslo. https://cdn.cloud.prio.org/files/8c9b5290-3ec8-4124-8d0c-ea3e05e2e4c0/time-for-a-reset-submitted-28-03-25-final.pdf?inline=true

Chicago

Reid-Henry, Simon. Time for a Reset: Development Cooperation at the Crossroads. Peace Research Institute Oslo, 2025. https://cdn.cloud.prio.org/files/8c9b5290-3ec8-4124-8d0c-ea3e05e2e4c0/time-for-a-reset-submitted-28-03-25-final.pdf?inline=true.

Wikipedia

{{cite report |last1=Reid-Henry |first1=Simon |title=Time for a Reset: Development Cooperation at the Crossroads |publisher=Peace Research Institute Oslo |date=January 2025 |url=https://cdn.cloud.prio.org/files/8c9b5290-3ec8-4124-8d0c-ea3e05e2e4c0/time-for-a-reset-submitted-28-03-25-final.pdf?inline=true |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{reidhenry2025time, author = {Reid-Henry, Simon}, title = {{Time for a Reset: Development Cooperation at the Crossroads}}, institution = {Peace Research Institute Oslo}, year = {2025}, month = jan, url = {https://cdn.cloud.prio.org/files/8c9b5290-3ec8-4124-8d0c-ea3e05e2e4c0/time-for-a-reset-submitted-28-03-25-final.pdf?inline=true}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }