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Germany Unveils Tighter Development Policy: Grants for Poorest, Loans for Emerging Economies

Berlin directs its efforts to crisis regions tied to European security under a strategy that links aid to national interests.

Overview

  • Development Minister Reem Alabali Radovan presented a plan to focus limited resources on the least developed countries and on combating hunger and poverty.
  • Work with emerging economies will primarily use repayable financing rather than budget-funded grants.
  • Priority regions include the European neighborhood, the Middle East and North Africa, the Sahel, and the Horn of Africa, with an emphasis on stabilization and reconstruction.
  • The ministry promotes partnerships of equals and intends to ensure procurement in development projects gives fair access to German and European firms.
  • Further savings are anticipated in the 2027 federal budget, and the new approach is intended to achieve greater impact with fewer funds.