Kathmandu, April 10: Official development assistance from wealthy nations to poorer countries fell by a record 23.1 percent in 2025, dropping to $174.3 billion, the Organisation for Economic Co-operation and Development (OECD) said Thursday. This marks the steepest annual decline since records began in 2015.

According to OECD data, 26 out of 34 members of its Development Assistance Committee reduced aid contributions. Major donors, including the United States, Germany, the United Kingdom, Japan, and France, all cut their budgets simultaneously for the first time.

The report attributes the decline mainly to domestic economic pressures and political constraints. The United States alone accounted for nearly 75 percent of the total reduction, slashing its aid spending by 56.9 percent, the largest cut ever by a single country. As a result, Germany has become the world’s largest donor for the first time, the OECD said.

Despite remaining among the top contributors in absolute terms, US aid now stands at just 0.09 percent of its gross national income, making it the least generous donor relative to economic size within the committee.

Overall, total aid from DAC members represented only 0.26 percent of their combined national income in 2025. Only Denmark, Luxembourg, Norway, and Sweden met the United Nations target of allocating 0.7 percent.

The five largest donors were responsible for 95.7 percent of the total aid cuts. The OECD noted that reductions in the US Agency for International Development budget following Donald Trump’s return to the White House played a key role in the decline.

Meanwhile, non-DAC countries such as Turkey, the United Arab Emirates, and Qatar are increasing their role in global aid.

OECD Secretary-General Mathias Cormann warned that the sharp drop is “deeply concerning,” urging better use of limited resources and new financing sources. DAC Chair Carsten Staur called it “extremely disappointing.”

The OECD projects a further 5.8 percent decline in global aid in 2026, raising concerns about long-term impacts on the international development system.

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