Private philanthropic providers

Over the past years, OECD-DAC statistics have largely expanded their coverage in terms of private philanthropy. With the Bill & Melinda Gates Foundation sharing its data since 2010, OECD statistics on development currently include project-level information from 33 of the largest foundations working for development. This profile shows some of the most important insights from all the data collected on foundations’ expenditures for development in 2018 and prior years.

Private philanthropic providers provided USD 7.8 billion for development in 2018. On a net basis, foundations provided 6.7 billion. Within the foundations’ gross development finance portfolio in 2018, 84% was provided in the form of grants and 16% in the form of non-grants (loans accounted for 15.6% and equities for 0.4%).1 See the methodological notes for details on the definitions and statistical methodologies applied.

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In 2018, foundations provided most of their total funding bilaterally. Gross bilateral allocations amounted to USD 7.3 billion (92.8% of total private development finance), of which 9.9% was channelled through multilateral organisations (earmarked contributions). The foundations allocated 7.2% of total private development finance as core contributions to multilateral organisations – this refers to core contributions of the Bill & Melinda Gates Foundation to Gavi, the Vaccine Alliance and the Global Fund to Fight AIDS, Tuberculosis and Malaria.

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In 2018, foundations increased their total support (core and earmarked contributions) to multilateral organisations. They provided USD 1.3 billion of gross development finance to the multilateral system, an increase of 3.6% in real terms from 2017. Of this, USD 560.5 million was core multilateral development finance and the rest was earmarked for a specific country, region, theme or purpose. Project development finance earmarked to a specific theme and/or country (tight earmarking) accounted for 73.6% of the foundations’ non-core contributions, while the remaining 33.7% was softly earmarked (to pooled funds and specific-purpose programmes and funds).

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In 2018, foundations’ total contribution to multilateral organisations was mainly allocated to the United Nations (UN), the World Bank Group and other multilateral organisations.

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Note: See the list of UN acronyms.

See the section on “Geographic and thematic focus” for the geographical and thematic breakdown of bilateral allocations earmarked through the multilateral development system.

In 2018, foundations increased their bilateral spending compared to the previous year, reaching USD 7.3 billion (including earmarked contributions to multilateral organisations) – an increase of 3.5% in real terms from 2017. In terms of the Sustainable Development Goals (SDGs), foundations focused most of their bilateral development finance on addressing the following goals of the UN 2030 Agenda: partnerships, health and well-being, reduced inequality, decent work and economic growth, and gender equality.

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Note: Finance for SDG 1 (No Poverty), SDG 10 (Reduced Inequalities) and SDG 17 (Partnerships) is considered cross-cutting among most reported activities.

In 2018, foundations channelled their bilateral development finance mainly through non-governmental organisations and civil society (36.1%). Other important channels included universities, colleges or other teaching institutions, research institutes or think tanks (25.4%); the private sector (22.7%); and multilateral organisations (9.9%).

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Note: NGO: non-governmental organisation; PPP: public-private partnership.

In 2018, civil society organisations (CSOs) received USD 2.6 billion of foundations gross bilateral development finance. Twenty-three per cent of gross bilateral development finance was allocated to CSOs as core contributions and 77% was channelled through CSOs to implement projects initiated by the foundation (earmarked funding). Between 2017 and 2018, core and earmarked contributions to CSOs increased as a share of foundations’ bilateral development finance, from 33.5% to 36%.

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In 2018, USD 6.6 billion of foundations’ bilateral development finance (90.7%) was earmarked for specific projects, programmes and other activities, while the remaining 9.3% was extended for grantees’ general operating support. Of the earmarked funds, 87.7% were project-type interventions; 4.6% programme-level support; and 6% technical assistance, capacity building and similar activities (also including scholarships in developing countries). Expenditure in donor countries amounted to USD 105.9 million, mainly consisting of development awareness raising and scholarships in donor countries (0.9% and 0.7% of bilateral earmarked funds respectively). Moreover, USD 6 million was extended as debt relief in the context of the buy-down arrangements of the Gates Foundation.

In 2018, Africa was the main beneficiary region of foundations’ bilateral development finance. USD 1.9 billion was allocated to Africa, USD 1.4 billion to Latin America and the Caribbean, and USD 956.5 million to Asia, accounting respectively for 25.7%, 20% and 13.2% of gross bilateral development finance. USD 25.5 million was allocated to ODA-eligible countries in Europe. Approximately 40.8% of gross bilateral development finance was unspecified by region in 2018.

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Bilateral private development finance by recipient country

In 2018, 33.6% of gross bilateral development finance went to the foundations’ top 10 recipients. The share of gross bilateral development finance that was not allocated by country was 52%.

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In 2018, least developed countries received 10.9% of the foundations’ gross bilateral development finance (USD 788.3 million). The foundations allocated the highest share of gross bilateral development finance (21.8%) to upper middle-income countries. Fifteen per cent was allocated to lower middle-income countries, noting that 52% was unallocated by income group. Further, foundations allocated 2.5% of their gross bilateral development finance to small island developing states in 2018, equal to USD 179 million.

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Note: LDC: least developed country; LIC: low-income country; LMIC: lower middle-income country; UMIC: upper middle-income country; MADCTs: more advanced developing countries and territories.

Support to fragile contexts reached USD 1.3 billion of gross bilateral development finance in 2018 (17.8% of gross bilateral development finance).

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Note: The chart represents only gross bilateral private development finance that is allocated by country.

In 2018, most of the foundations’ bilateral private development finance was allocated to social infrastructure and services. Investments in this area accounted for 59.4% of bilateral private development finance commitments (USD 4.1 billion), with a strong focus on health (USD 2.1 billion) and population policies and reproductive health (USD 817.4 million); support to government and civil society (USD 521.2 million) and education (USD 349.4 million). Private development finance for the production sector amounted to USD 1.5 billion, with a focus on agriculture, forestry and fishery (USD 797.6 million). Financial contributions to the economic infrastructure and services sector totalled USD 702.3 million, with a focus on financial and other services (USD 399.3 million) and on energy (USD 172.4 million). Bilateral humanitarian aid from foundations amounted to USD 110.4 million (1.6% of bilateral development finance).

In 2018, all foundations committed USD 2.2 billion (67.4% of bilateral allocable development finance) to promote aid for trade and improve developing countries’ trade performance and integration into the world economy in 2018.

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In 2018, USD 1.7 billion (26.9% of foundations’ bilateral allocable private aid) targeted gender equality and women’s empowerment as either a principal or a significant objective.2 The share of bilateral allocable development finance committed to gender equality and women’s empowerment as a principal objective was 9%.

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In 2018, foundations committed 9.2% of their bilateral allocable development finance (USD 629.5 million) in support of the environment. USD 572.8 million targeted climate change, of which 7% focused on mitigation and 4.3% on adaptation.

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The methodological notes provide further details on the definitions and statistical methodologies applied, including core and earmarked contributions to multilateral organisations, the SDG focus of private development finance, channels of delivery, unspecified/unallocated allocations, the gender equality policy marker, and the environment markers.

Notes

← 1. Non-grants include loans, equity investments, mezzanine finance and other investments with a development objective, usually administered as programme- and mission-related investments.

← 2. The use of the recommended minimum criteria for the marker by some members in recent years can result in lower levels of development finance reported as being focused on gender equality.

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