NCPA - National Center for Policy Analysis

U.S. Remains Largest Donor of Foreign Aid

February 10, 2004

In 2000, the United States officially gave $9.9 billion in foreign aid -- also referred to as Official Development Assistance (ODA). President Bush has pledged a 50 percent increase in ODA by 2006 -- the largest increase since the Marshall Plan -- in addition, new legislation devotes $15 billion to fight AIDS, tuberculosis and malaria in Africa and elsewhere.

Although the United States routinely gives the greatest overall amount of foreign aid, critics argue that as a percentage of national income, ODA places America behind all the other industrialized nations.

But according to Carol C. Adelman, a former U.S. aid official, private donations dwarf official aid:

  • Official donations ($9.9 billion) account for only 17 percent of overall foreign assistance.
  • Americans annually give $35.1 billion each year in private donations -- more than three and a half times the amount given by ODA.
  • About $12.7 billion in non-ODA funding is annually provided to Israel, Russia and Eastern Europe, as well as to the National Endowment for Democracy and International Monetary Fund, among many others.

Private donors include voluntary organizations, religious congregations, foundations, corporations and universities. However, individual remittances -- financial assistance sent by individuals to their homelands -- accounts for the largest portion of private giving, about $18 billion annually.

Ultimately, the United States is the most generous nation, providing the most foreign direct investment and generating the bulk of the world's research and development. Moreover, through its military, it guarantees the security necessary for promoting economic growth and democracy in developing countries.

Source: Carol C. Adelman (Hudson Institute), "The Privatization of Foreign Aid: Reassessing National Largesse," Foreign Affairs, November 2003.

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