How the closure of USAID will affect the allocation of global official development assistance
June 26, 2025
The presentation by Bruno Cabrillac, Director General of FERDI, on the topic of financing development in 2025, was structured around the theme: a challenge, a solution, and the means to implement it.
A solution: focus concessional resources more on the most vulnerable countries, because this is more in line with our commitments, but also because aid is more effective in situations of vulnerability.
How: by taking vulnerability into account when targeting beneficiary countries, but also and above all when determining the size of country envelopes.
Some FERDI's publications on the subject:
↪ Guillaumont P. (2025) Pour une utilisation efficace d’un indice de vulnérabilité multidimensionnelle dans le financement du développement, Ferdi, 96 p.
↪ Feindouno S., Guillaumont P. (2025) "Définir une liste de pays 'prioritaires' d’une aide bilatérale. Note méthodologique en référence à l’aide française", Ferdi Note brève B279, mars.
↪ Feindouno S., Guillaumont P. (2025) "Les multilatéraux allouent-ils leurs ressources concessionnelles en fonction de la vulnérabilité des pays, ainsi que leur revenu ? Comparaison avec les bilatéraux à travers une nouvelle mesure de la sélectivité", Ferdi Note brève B278.
A solution: better mobilize household savings, particularly in sub-Saharan Africa, for development purposes. Formal savings are mainly in the form of bank deposits, which offer too little return. Banks mainly lend to governments and are often over-liquid, meaning that private investment is underfunded.
How: create an attractive regulated savings product (low risk, minimum return) that can finance public investment, encouraging households to save and banks to diversify their resources and, above all, their uses by financing more private investment. The international community can support this type of initiative.
