Wealthy nations' retreat from global development efforts

A troubling shift is emerging across the global development landscape, as many of the world's wealthiest nations cutback commitments that once formed the backbone of international aid and cooperation. A recent study warns that several high-income economies-including the United States and Japan-are reducing development assistance and curtailing the flow of funds through multilateral lenders, threatening to undermine decades of progress in poverty reduction, health and economic resilience in poorer regions.

The findings come from the Commitment to Development Index (CDI), a comprehensive biennial assessment by the Washington-based Centre for Global Development (CGD). The index evaluates 38 major economies across more than a hundred indicators covering development finance, trade, investment, migration, environment, health, security and technology. Its purpose is to see how well the policies of rich nations support or hinder the prospects of developing countries. The latest edition highlights a stark divergence. While a few countries continue to uphold strong development standards, a growing number are retreating from their global responsibilities.

At the top of the 2025 donor ranking are Sweden, Germany, Norway, and Finland--- all of which have consistently demonstrated strong commitments to international development, both through financial contributions and supportive policy frameworks. These Nordic economies continue to channel substantial portions of their national income towards development cooperation. Their continued leadership stands in contrast to the widespread retrenchment occurring among many of their peers.

The United Kingdom, once considered a global leader in development assistance, rose two places to rank fifth in the latest index. However, this improvement is based on data that preceded the government's controversial decision to impose a 40 per cent cut on its foreign aid budget. The reduction-one of the most severe in modern British history-is expected to drive the UK much further down the index in future assessments. Analysts warn that the cuts will have far-reaching implications, reducing support for key programmes in health, humanitarian relief, climate adaptation and education across Africa and Asia.

The United States, meanwhile, dropped two places to number 28 in the latest ranking. Importantly, this position does not capture the full extent of the drastic changes enacted by the Trump administration, which has aggressively scaled back foreign aid and development financing. Since coming to office, President Donald Trump has slashed the US foreign assistance budget, weakened oversight mechanisms, and shuttered USAID earlier this year-a move that stunned development experts and raised concerns about who will coordinate America's remaining global development efforts. Lately, what has emerged from the US decision to pull out from dozens of multilateral bodies, including quite a few under the UN, poses to cause serious setback to global development structure reliant largely on US support and collaboration.  

This worrying trend came at a sensitive geopolitical moment as South Africa recently hosted the Group of 20 (G20) Summit. The gathering was expected to offer a symbolic opportunity for major powers to strengthen their engagement with the Global South. Absence of President Trump in the Summit underscores the growing distance between Washington and long-standing multilateral platforms. At a time when emerging economies look to advanced nations for leadership on climate financing, debt restructuring and trade facilitation, the withdrawal of the US and other wealthy nations risks deepening mistrust between the Global North and South.

According to the aforementioned study, several advanced economies have redirected funds once allocated for development cooperation towards bolstering their defence budgets. Heightened geopolitical tensions-from conflicts in Eastern Europe to instability in the Middle East and Asia-have prompted governments to prioritise military spending over development commitments. While national security concerns are legitimate, development experts caution that cutting aid may, in the long run, exacerbate global insecurity by fuelling instability, migration pressures, and economic stagnation in the already fragile states.

The retrenchment of aid is especially concerning given the mounting challenges facing low-income nations. Climate change is intensifying extreme weather events, food insecurity is rising in several regions, and many countries remain burdened with unsustainable debt. Development financing, access to technology, trade opportunities and transparent multilateral cooperation remain essential tools for addressing these systemic challenges. Any sustained reduction in aid flows threatens to reverse hard-won gains in poverty alleviation, global health, and sustainable development.

Many low- and lower-middle-income economies, including Bangladesh, rely heavily on predictable external financing to sustain essential programmes-from primary healthcare and education to agricultural modernisation, infrastructure building, climate adaptation, and digital transformation. A decline in aid flows will likely slow down progress on nationally determined development plans, delay critical infrastructure projects and widen the financing gaps needed to achieve the Sustainable Development Goals. Countries confronting climate vulnerabilities may struggle to access the adaptation funds required to protect their communities, while fragile states could see setbacks in governance reforms, peace-building efforts, and poverty-reduction strategies. In effect, the pullback by rich nations risks creating a cascade of stalled initiatives across the Global South, undermining years of incremental progress and pushing many nations away from the path of inclusive and sustainable development.

Development assistance is not merely an act of benevolence-it is a strategic investment in global stability and shared prosperity. As global inequality deepens and geopolitical rifts widen, renewed commitment, not retreat, is required from those who possess the resources and influence to make a meaningful difference.

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