Aid: Germany Refocuses Development Policy in a Changing Global Order

Against a backdrop of shrinking budgets and a weakening system of international cooperation, Germany’s Federal Minister for Economic Cooperation and Development, Reem Alabali Radovan, has announced a strategic reorientation of the country’s development policy. The new approach places stronger emphasis on clearly defined priorities, regional focus and a more explicit alignment with German interests.

Presenting a policy paper in Berlin on Monday, the Social Democratic minister argued that international solidarity is “under massive pressure”. Wars, multiple global crises and, most recently, the decision by the United States to drastically cut its foreign aid budget and withdraw from many international organisations have fundamentally altered the landscape of development cooperation. Germany, she said, must adapt to these new realities.

The shift also reflects domestic constraints. Germany’s development budget has been reduced in recent years, falling from over €12 billion in 2023 to around €10 billion in 2025 and 2026. With fewer resources available, Alabali Radovan wants aid spending to become “more strategic, more focused and more partnership-oriented”.

Africa at the centre of hunger and poverty reduction

A central pillar of the new strategy is a renewed focus on fighting hunger and poverty, described by the minister as the “core mandate” of development cooperation. Funds from the federal budget are to be channelled primarily to the poorest and least developed countries in Africa. By contrast, emerging economies will in future generally receive support only in the form of repayable loans rather than grants.

The emphasis on Africa comes at a time when humanitarian needs on the continent are rising sharply, aggravated by climate change, conflict and global economic shocks. Cuts in US development assistance have already left significant funding gaps in food security, health and education programmes, raising concerns among international NGOs and UN agencies.

Strategic regions and German interests

Geographically, Germany intends to prioritise crisis regions deemed particularly relevant for German and European stability. These include the EU’s immediate neighbourhood, the Middle East, North Africa, the Sahel and the Horn of Africa. Support for crisis and refugee-related programmes in other parts of the world is to be phased out in an “orderly manner”.

At the same time, Alabali Radovan reaffirmed Germany’s continued support for the UN Relief and Works Agency for Palestine Refugees (UNRWA), despite ongoing criticism of the organisation.

While the minister stressed the importance of engaging the Global South “on equal footing”, the strategy paper also makes clear that partnership now explicitly includes the articulation of Germany’s own interests. Development policy, it argues, should remain values-based while being more closely aligned with strategic objectives.

Multilateralism despite US retreat

Notably, Germany is positioning itself as a defender of multilateral cooperation at a time when the US is stepping back. The strategy envisages a stronger German leadership role within international organisations, particularly in areas such as health and education. It also seeks to deepen economic cooperation with developing countries, including improving procurement processes to enhance opportunities for German and European companies.

For African countries and civil society observers, the new direction raises familiar questions: how to balance genuine partnership with donor interests, and how to ensure that development cooperation remains driven by need rather than geopolitics. What is clear, however, is that Germany’s recalibration reflects a rapidly changing global order in which traditional aid models are under unprecedented pressure.

Adira Kallo