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Development cooperation appropriations

In 2016, the development cooperation appropriations in the Budget amount to EUR 818 million. Development cooperation appropriations consist of the exclusive ODA budget item administered by the Ministry for Foreign Affairs (MFA) and other development cooperation funding. The share of the exclusive ODA budget item administered by the MFA is EUR 493 million.

According to the Government’s budget proposal, the appropriations for development cooperation will be subject to EUR 200 million cuts annually beginning in 2016 as a part of the general government adjustment measures. In addition to this, EUR 130 million of grant aid will be converted into loans and capital investment and channelled to the developing countries through enterprises committed to corporate social responsibility.

The cuts are directed at the exclusive ODA budget item administered by the MFA (EUR 330 million) and the increase will be targeted at loan and capital investments (EUR 130 million). The MFA has prepared the targeting of the savings as part of the budget proposal and the general government fiscal plan on the basis of the government's guidelines.

In the general government fiscal plan for 2017–2020 (5 April 2016), a new EUR 25 million saving will be directed at development cooperation expenditure from 2018. After this change, development cooperation appropriations will average 0.39% of GNI during the spending limits period.

The new government has also decided to stop the channelling of revenue from emissions trading into development cooperation, which will result in a considerable reduction of funds available for development cooperation. In 2014, for example, the amount of emissions trading revenue channelled into development cooperation was EUR 69 million.

The Ministry for Foreign Affairs is responsible for Finland’s exclusive ODA budget item

The 2016 development cooperation appropriations amount to EUR 818 million, accounting for 0.38 per cent of Finland's gross national income (GNI). Finland is committed to raising the share of official development assistance to 0.7 per cent of GNI.

Development cooperation appropriations are divided into the exclusive ODA budget item administered by the Ministry for Foreign Affairs and other development cooperation funding.

The appropriations under the exclusive ODA budget item administered by the Ministry for Foreign Affairs are designated to nine budget allocation table lines:

  1. Multilateral development cooperation
  2. Country-specific and regional development cooperation
  3. European Development Fund
  4. Non-country specific development cooperation
  5. Humanitarian assistance
  6. Planning, support functions and communication of development cooperation
  7. Evaluation and internal audit of development cooperation
  8. Support to development cooperation conducted by civil society organisations
  9. Concessional credits

In statistics, other development cooperation funding includes costs arising from refugee reception, Finland's share of the EU development cooperation budget, and other disbursements counted as development assistance in various administrative sectors.

In development cooperation, the amount of the appropriations allocated for a given year differ from the funds actually used (i.e. the disbursements), because the appropriations are “deferrable appropriations”. This means that if for some reason not all the allocated appropriations can be used in the first year, they are still available in the subsequent two years.

As development cooperation often takes place in difficult circumstances, it is important to have a flexible timeframe for the use of the appropriations. On the other hand, it takes years to achieve lasting development results, and a long-term commitment to cooperation is therefore needed.

How were development cooperation funds used in 2015?

The Finnish official development assistance actually used (i.e. the disbursements) amounted in 2015 to EUR 1.164 billion, or 0.56 per cent of GNI. The amounts of bilateral cooperation assistance and multilateral cooperation assistance were EUR 624 and EUR 540 million respectively.

The difficult humanitarian situation in the world was reflected in the allocation of aid. Similar to 2014, humanitarian aid and the prevention of disasters was the sector to which the most development cooperation funds were allocated: EUR 105,7 million.

The next biggest sectors in Finland's bilateral cooperation were support for improving the governance of developing countries and the work of non-governmental organisations (10%), agriculture and forestry of developing countries (8%) and education (8%).

Statistics on Finland's development assistance disbursements in 2015:

The chart below shows the distribution of Finland's bilateral development assistance into different sectors (in Finnish).

Distribution of Finland's bilateral development assistance in 2015.
Distribution of Finland's bilateral development assistance in 2015.

"Unspecified" covers horizontal aid, targeting different fields of activity.

Development cooperation disbursements 1990–2015

In 2015, Finland's development cooperation disbursements decreased by approximately EUR 68 million compared to the previous year. In the longer term, development cooperation disbursements have almost doubled from EUR 600 million in the early 1990s to EUR 1.16 billion in 2015.

The share of development assistance of GNI reached the 0.7 per cent level in 1991, but it dropped to 0.3 per cent in just a few years. Since then, the share of GNI has grown slowly to reach 0.6 per cent in 2014 and 0.56 per cent in 2015.

Development cooperation disbursements 1990-2015.

Disbursements to the largest recipient countries

The 10 largest recipient countries or regions of Finnish development assistance in 2015 were Afghanistan, Tanzania, Mozambique, Nepal, Ethiopia, Kenya, Somalia, Zambia, Syria and Palestinian Territory.

Largest recipient countries in 2015.

Statistics on the use of development cooperation funds

Official Development Assistance (ODA) is monitored on the international level through the reporting of the member countries of the OECD Development Assistance Committee (DAC). The statistics showing the OECD/DAC member countries' development cooperation funds are available on the DAC website.

Finland promotes the international transparency of development cooperation

Committed to the promotion of the transparency of development cooperation, Finland also supports this objective internationally. Finland is one of the founders of the International Aid Transparency Initiative (IATI).

The purpose of IATI is to assemble and publish development cooperation information in an easily accessible and comparable form, and more than 130 development cooperation actors from government donors to foundations and NGOs have committed to it. The aim is to create a common open standard for different development actors. When the various parties report their data in a common form, they are easier to compare and the flow of information becomes more transparent.

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