Germany

Introduction

Germany’s development policy aims to enable dignity for all people while respecting planetary boundaries. As was recognised by the 2018 DAC mid-term review of its development co-operation, Germany is a leader in prioritising climate change in its development co-operation, notably through support for climate risk insurance and clean energy. Furthermore, Germany engages actively with large emerging economies, particularly on global public goods. It also prioritises responsible business conduct and sustainable value chains.

Germany continues to adjust its strategic and regional priorities for development co-operation to meet the most pressing challenges in an evolving international context. In 2018, a new strategy paper identified five megatrends as focus areas for development co-operation: 1) demographic growth; 2) resource scarcity; 3) climate change; 4) digitalisation and interdependence; and 5) displacement and migration. Under its G20 presidency in 2017, Germany launched the “Marshall Plan with Africa”, focusing on job creation, private sector development and supporting partner countries’ reforms in relation to good governance, protecting human rights and sustainable economic development.

While acknowledging progress, the DAC mid-term review suggested that Germany increase its focus on least developed countries (LDCs) and improve government co-ordination, through, for example, more comprehensive, whole-of-government co-operation strategies.

Official development assistance

Germany is the DAC’s second largest donor by volume. Its aid has increased significantly over the past years beyond in-donor refugee costs, both in absolute terms and relative to gross national income (GNI; at 0.61% in 2018). Between 2015 and 2018, Germany’s official development assistance (ODA) grew by USD 6.9 billion (constant prices), while in-donor refugee costs increased by USD 0.7 billion. Germany provides the bulk of its ODA bilaterally (81%), relying on its main implementing agencies GIZ and KfW. Germany has one of the highest shares of ODA provided to middle-income countries.

In 2018, Germany provided USD 25.0 billion in total ODA (preliminary data, current prices), using the new “grant-equivalent” methodology (see the methodological notes for further details) adopted by DAC members on their reporting of 2018 data as a more accurate way to count the donor effort in development loans. This represented 0.61% of GNI. Under the “cash-flow basis” methodology used in the past, 2018 net ODA was USD 25.9 billion, which represented a fall of 3.0% in real terms from 2017, due to lower in-donor refugee costs.

In 2018, in-donor refugee costs were USD 4.1 billion, a decrease of USD 2.3 billion in 2017 constant prices. In 2018, these costs represented 15.7% of Germany’s total net ODA.

Germany’s share of untied bilateral ODA (excluding administrative costs and in-donor refugee costs) was 85.5% in 2017 (slightly down from 86.2% in 2016), while the DAC country average was 82.1%. The grant element of total ODA was 90.2% in 2017. Non-grants represented 16.7% of gross ODA.

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In 2017, 81.4% of gross ODA was provided bilaterally, of which 16.1% was channelled through multilateral organisations (multi-bi/non-core contributions). Germany allocated 18.6% of total ODA as core contributions to multilateral organisations. Learn more about multilateral development finance.

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In 2017, country programmable aid was 37% of Germany’s bilateral ODA, compared to a DAC country average of 48% (see the methodological notes for further details on country programmable aid). Project-type interventions accounted for 79.2% of this aid.

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The public sector is by far the most important implementation channel (67.9% of gross bilateral ODA in 2017, down from 71.4% in 2016). The share of bilateral ODA channelled through private sector institutions was 2.0%. In 2017, Germany channelled USD 1.5 billion through universities or other teaching and research institutions, equal to 6.5% of its gross bilateral ODA. See the methodological notes for further details on channels of delivery.

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In 2017, USD 1.5 billion of gross bilateral ODA was channelled to and through civil society organisations (CSOs). Between 2016 and 2017, ODA channelled to and through CSOs increased marginally as a share of bilateral aid (from 6.0% to 6.6%). Learn more about ODA allocations to and through CSOs and the Civil Society Days.

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In 2017, bilateral ODA was primarily focused on Asia and Africa. USD 2.7 billion was allocated to sub-Saharan Africa, USD 2.5 billion to the Middle East, and USD 2.4 billion to South and Central Asia. Allocations to all these regions increased between 2016 and 2017.

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In 2017, 26% of gross bilateral ODA went to Germany’s top 10 recipients. Its top 20 recipients are mainly middle-income countries, mostly in Asia and the Middle East, but also include seven LDCs. Support to fragile contexts reached USD 5.3 billion in 2017 (23.5% of gross bilateral ODA). Learn more about support to fragile contexts.

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In 2017, 11.1% of Germany’s gross bilateral ODA (USD 2.5 billion) was allocated to the LDCs, a slight increase from 9.8% in 2016. Support to the LDCs has been continuously increasing from USD 1.8 billion (0.09% of GNI) in 2013 to USD 2.5 billion in 2017 (0.11% of GNI). The DAC country average for 2017 was 23.5%. Lower middle-income countries received the highest share of bilateral ODA in 2017 (24.2%), noting that 46.9% was unallocated by income group.

At 0.11% of GNI in 2017, total ODA to the LDCs (including imputed multilateral flows) was lower than the UN target of 0.15-0.20% of GNI.

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In 2017, 29.4% of bilateral ODA commitments (USD 7.7 million) was allocated to social infrastructure and services, with a focus on support to government and civil society, and education (both USD 2.4 billion). ODA for economic infrastructure and services totalled USD 4.4 billion with a focus on energy (USD 2.4 billion). Humanitarian aid amounted to USD 2.8 billion. In 2017, Germany committed USD 36 million of ODA to support developing countries to raise domestic revenue, amounting to 0.2% of bilateral allocable aid. Germany also committed USD 5.7 billion (32.2% of bilateral allocable aid) to promote aid for trade and improve developing countries’ trade performance and integration into the world economy in 2017. For the 2006-15 period, Germany was among the top 5 providers of aid for trade globally.

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USD 6.9 billion of gross bilateral allocable ODA supported gender equality. In 2017, 39.2% of Germany’s bilateral sector-allocable aid had gender equality and women’s empowerment as a principal or significant objective (down from 40.5% in 2016), compared with the DAC country average of 36%. A significantly higher share of interventions on social infrastructure and services addresses gender than those on economic infrastructure. Germany screens virtually all interventions against the gender marker (99.4% in 2017). Learn more about ODA focused on gender equality and the DAC Network on Gender Equality.

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USD 8.4 billion of bilateral ODA commitments supported the environment. In 2017, 47.2% of its gross bilateral allocable aid supported the environment , down from 50.6% in 2016 and compared with a DAC country average of 33%. Thirty-eight per cent (USD 6.7 billon) focused on climate change, compared with the DAC country average of 25%. Germany has a greater focus on mitigation (32.9% in 2017) than adaptation (19.1%). Learn more about climate-related development finance.

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Other financial flows and amounts mobilised from the private sector

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In 2017, Germany’s development bank KfW, the Federal Ministry of Finance, and the Federal Ministry of Economic Cooperation and Development (BMZ) mobilised USD 296.9 million from the private sector through credit lines, shares in collective investment vehicles (CIVs), guarantees and direct investment in companies.

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Of the country-allocable finance mobilised from the private sector in 2012-17, 82% targeted middle-income countries and 2% the LDCs.

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Germany’s private finance mobilised mainly related to activities in the energy (40%); banking and financial services (31%); and industry, mining and construction (20%) sectors. Learn more about the amounts mobilised from private sector for development.

Institutional set-up

The BMZ co-ordinates development co-operation policy and oversees 40.7% of Germany’s ODA. This share increases to 52% when excluding in-donor refugee costs. A number of other federal ministries manage ODA resources, in particular the Federal Foreign Office (AA) overseeing humanitarian assistance. Germany has two main implementing agencies, GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH) for technical co-operation, and KfW for financial co-operation, comprising KfW Development Bank, DEG (development finance institution) and KfW IPEX Bank (project and export financing).

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Evaluation system

The BMZ’s Evaluation and Research Division – though it has largely ceased commissioning evaluations, retains the function to guide the overall evaluation system, setting core standards and assigning roles and responsibilities to the main evaluation actors (DEval, GIZ and KfW Development Bank) as far as its area of competence is concerned.

The German Institute for Development Evaluation (DEval) was created in 2012 and is primarily tasked to perform strategically relevant and mostly complex evaluations for all German development activities. Independent scientific evidence in conducting evaluations is enshrined in the DEval charter. DEval is an independent entity institutionally separated from the BMZ. Its Advisory Council includes members from parliament, academia and civil society, thus increasing transparency.

GIZ’s Evaluation Unit performs corporate and technical co-operation project evaluations and reports directly to the Management Board; as a corporate unit, it is separate from and independent of GIZ’s operational business. KfW Development Bank’s Evaluation Department mostly focuses on standard ex post evaluations of individual projects and programmes. The director of the Evaluation Department reports to the responsible member of the Board of Directors of the KfW Group. Learn more about evaluation in Germany.

Visit the DAC Evaluation Resource Centre website for evaluations of German development co-operation.

Performance against the commitments for effective development co-operation

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Explore the Monitoring Dashboard of the Global Partnership for Effective Development Co-operation.

Additional resources

2015 DAC Peer Review of Germany: https://www.oecd.org/dac/peer-reviews/peer-review-germany.htm

2018 DAC mid-term review of Germany: https://www.oecd.org/dac/peer-reviews/Germany-2018-Mid-term-review.pdf

Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH: https://www.giz.de/en/html/index.html

Federal Foreign Office (AA): https://www.auswaertiges-amt.de/en

Federal Ministry of Economic Cooperation and Development (BMZ): www.bmz.de/en/index.html

KfW International Financing: https://www.kfw.de/International-financing

Member of the OECD Development Assistance Committee (DAC) since 1960.

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