How to reform EU overseas aid in the wake of Trump

The sudden interruption of funding by the US government to humanitarian actors has shocked all organisations involved in international solidarity.

The Red Cross Movement, UN organisations, and international NGOs are already assessing how the announced restrictions will impact their operations in the field and their staff operating expenses, such as the payment of salaries. Plus the social consequences in the countries and disaster zones these organisations' leaders care for.

Without a doubt, an 'every man for himself' reaction will emerge from these three main families of humanitarian actors to protect their action plans and the future of their employees in the headquarters of the different organisations and in the countries where they operate.

NGOs are particularly vulnerable as they will be hit by president Donald Trump's announced restrictions in two ways:

1. Via the direct interruption of funding from the United States Agency for International Development (USAID)

2. Indirectly by the decrease of sums received, secondarily, from the main UN agencies involved in crisis areas  (World Food Program, United Nations High Commissioner for Refugees, UNICEF, etc)

This shockwave is the extreme consequence of a funding system that focuses on a few member countries of the OECD for the near-total amount allocated by states. The US is, ahead of the EU, the first global sponsor of emergency aid.

This sudden tension on the limitations on funding arises as the years 2023-2024 have shown a deterioration of the main indicators of the acting model: for the first time in 10 years, the amounts received for action have decreased, mainly to the detriment of private funds, while government funds were still maintained; but allocated funds reached less than 50 percent of the expected revenue.

From 2022 to 2023, the financial need grew by $5bn [€4.8bn]. The crises extending for over five consecutive years now represent 90 percent of global crises and affect 168 million people.

Just 10 years ago, only 30 percent of global crises belonged to this 'long-lasting' category. Since then, a splitting effect has occurred: new crises emerging, and a longer durability for those already existing ones.

Political priorities

This drop in the volume of funds is aggravated by 'political' limitations. All crises do not attract the same attention in the distribution of budgets, resulting in this reality: each state gives what it wants, and more than 80 percent of the allocated sums are 'directed' by donating countries towards crises they deem to have priority.

Against a backdrop of overall revenue shortfalls, this has led to flagrant inequalities in the treatment of the populations receiving aid.

Two recent major crises highlight the risks of two-speed compassion from donating countries. Or rather the political reasonings motivating their choices.

The war in Ukraine has already become fodder for such questions, since it has reoriented large parts of the available funds towards this unprecedented conflict in recent European history, turning them away from many other neglected crises, for example, Haiti, Afghanistan, Sudan, shipwreck victims in the Mediterranean, and others.

The second relates to the Gaza Strip.

Indeed, if, as can only be hoped for, the violence was to quiet down durably, a vital and massive increase in 'catch-up' humanitarian funding would have to be distributed to mitigate the nutritional and sanitary disaster experienced by the population.

The growing concern was already anticipated by observers of this economic model, before the recent decisions of president Trump. The main donating countries are starting to make public the efforts they intend to propose for the reconstruction of this region, and the restoration of its basic services, including medical facilities.

If Gaza does indeed become a massive humanitarian priority for all humanitarian aid donors, the situation could become catastrophic for even more neglected areas and populations.

This threat of selective financial solidarity adds to the present or expected risks of possible retreat of major donors such as Germany, for varying reasons.

In France, the currently negotiated budget announces a stark decrease (of 34 percent) of French Official Development Assistance (ODA).

European NGOs are therefore confronted with two simultaneous tasks of vital importance for the future of the civic solidarity they represent: surviving, and contributing to imagine the deep reform of an economic model of which the obsolescence has brutally been brought to light.

The EU can be one of its crucial actors: not by simply substituting itself to the US by increasing its contributions, but by first and foremost positioning itself as a voluntary actor for a deep change of the system.

There are two logical ways to try resolving the problems described above: largely broadening the number of donating countries, by agreeing to a shared political governance of this new system. It would be a path of revitalised multilateralism.

The other option, as recommended by economists such as Thomas Piketty, consists of the contribution of shareholders of large corporations, through fiscal measures.

In the European Union alone, these large corporations are expected to receive dividends estimated at €459bn — a sum 10 times greater than the amount needed today to assist more than 300 million people in need of vital humanitarian aid.

This op-ed was translated from French by Claire Helligsø-Dubost