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Mapping the Global Flow of Foreign Aid

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Global flow of foreign aid by country

Mapping the Global Flow of Foreign Aid

Billions of dollars routinely flow between countries for a number of reasons that go beyond simply helping people in less wealthy nations.

Extending foreign aid can be a tool to help strengthen relationships with allies, to help bolster a military presence in a key area, or even to project a positive image at home and abroad. Of course, aid also helps less wealthy nations do all kinds of things, from constructing new infrastructure to recovering from humanitarian crises or natural disasters.

Today’s infographic, from Wristband Resources, is a comprehensive look at the flow of foreign aid funds around the world in 2017.

The visualization raises a number of questions. For example:

  • Why does Japan send so much foreign aid to places like India and Vietnam?
  • Why does Turkey—one of the top 20 economies in the world—receive so much foreign aid?
  • And why did Ethiopia receive over $1 billion in aid from the United States?

Below we’ll answer key questions about foreign aid, while examining some of the more interesting relationships in detail.

What Constitutes Foreign Aid?

In simple terms, foreign aid is the voluntary transfer of resources from one country to another country—typically capital. Here are the six types of foreign aid:

    1. Bilateral Aid: Direct government-to-government assistance
    2. Multilateral Aid: When multiple governments pool resources in cooperation with organizations like the World Bank, the IMF, and the UN
    3. Tied Aid: The receiving country accepts aid with the expectation that it is spent in the lending country
    4. Voluntary Aid: A charitable donation, particularly when countries are facing a humanitarian crisis
    5. Project Aid: When aid is used to finance a specific project
    6. Military Aid: Similar to tied aid, but specific to weapons and military supplies

Note: The graphic above measures official development assistance (ODA), as defined by the OECD. ODA excludes military aid and the “promotion of donors’ security interests” as well as transactions that have primarily commercial objectives.

Which Countries Give the Most Foreign Aid?

Every country’s budget is different, and priorities can change as the economic and political cycles progress. As of 2018, here are the countries that contributed the most foreign aid as a portion of their Gross National Income (GNI).

foreign aid by country

In a 1970 resolution, the UN challenged countries to spend 0.7% of their GNI on foreign aid. Today, only four countries—Sweden, Luxembourg, Norway, and Denmark—surpassed the United Nations’ official development assistance target.

Using this measure, all top 10 countries are located in Europe. That said, in absolute terms, countries like Japan and the United States are still major contributors of aid around the world.

Below are a few real world examples of foreign aid flow, and more context around why money is flowing between the countries.

Japan → India

India is the top recipient of foreign aid, with the majority of funds coming from Japan. The country received close to $2.4 billion from Japan in 2017.

In recent years, the growth of Japan-India relations is viewed as a counter to China’s expanding economic and political influence across the Asian continent. As China’s national banks continue to fund megaprojects around the world, Japan is helping to fill a similar role in India.

One major project currently under construction is the Mumbai–Ahmedabad High Speed Rail Corridor. To move the $22 billion project forward, Japan offered India a 50-year loan at a 0.1% interest rate, covering 80% of the project cost.

European Union → Turkey

European institutions contributed nearly $2.6 billion to Turkey in 2017. On the surface this may seem confusing, as Turkey is more developed than most nations receiving foreign aid—however, much of this funding stems from the migration crisis. In 2016, the EU struck a deal with Turkey to reroute any migrant arriving in Europe via the Aegean Sea back to Turkey. In exchange, the EU agreed to fast-track Turkey’s EU membership bid.

Turkey has been bearing the brunt of caring for refugees, and the EU has contributed significant funds to the effort. For example, funding for the Emergency Social Safety Net (ESSN) program in Turkey has reached $1.2 billion.

In 2019, EU-Turkey relations took a chilly turn as European Parliament voted to suspend Turkey’s EU membership bid, expressing concern over creeping authoritarianism and human rights violations.

United States → Ethiopia

In 2017, Ethiopia was under a state of emergency as the African country faced a third straight year of drought, and security forces and anti-government protesters clashed in the streets. Though the U.S. does provide plenty of military and security-oriented aid, this is an example of humanitarian aid in the face of a crisis.

The United States was also the top source by far for aid flowing into other countries in the region, including Kenya, Tanzania, and South Sudan.

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Maps

Visualizing the BRICS Expansion in 4 Charts

We provide a data-driven overview of how the recent BRICS expansion will grow the group’s influence and reach.

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Visualizing the BRICS Expansion in 4 Charts

BRICS is an association of five major countries including Brazil, Russia, India, China, and South Africa. Distinguished by their emerging economies, the group has sought to improve diplomatic coordination, reform global financial institutions, and ultimately serve as a counterbalance to Western hegemony.

On Aug. 24, 2023, BRICS announced that it would formally accept six new members at the start of 2024: Saudi Arabia, Iran, Ethiopia, Egypt, Argentina, and the United Arab Emirates (UAE).

In this graphic, we provide a data-driven overview of how the BRICS expansion will grow the group’s influence and reach.

Share of Global GDP

Because most of the new BRICS members are considered to be developing economies, their addition to the group will not have a major impact on its overall share of GDP.

The following table includes GDP projections for 2023, courtesy of the IMF.

Original BRICS
Member
CountryGDP (USD billions)Share of Global (%)
Yes🇧🇷 Brazil$2,0812.0%
Yes🇷🇺 Russia$2,0632.0%
Yes🇮🇳 India$3,7373.6%
Yes🇨🇳 China$19,37418.4%
Yes🇿🇦 South Africa$3990.4%
No🇸🇦 Saudi Arabia$1,0621.0%
No🇮🇷 Iran$3680.4%
No🇪🇹 Ethiopia$1560.1%
No🇪🇬 Egypt$3870.4%
No🇦🇷 Argentina$6410.6%
No🇦🇪 UAE$4990.5%
-BRICS Total$30,76729.3%
-Rest of World$74,36270.7%

The original six BRICS members are expected to have a combined GDP of $27.6 trillion in 2023, representing 26.3% of the global total. With the new members included, expected GDP climbs slightly to $30.8 trillion, enough for a 29.3% global share.

Share of Global Population

BRICS has always represented a major chunk of global population thanks to China and India, which are the only countries with over 1 billion people.

The two biggest populations being added to BRICS are Ethiopia (126.5 million) and Egypt (112.7 million). See the following table for population data from World Population Review, which is dated as of 2023.

Original BRICS
Member
CountryPopulationShare of Global (%)
Yes🇧🇷 Brazil216,422,4462.7%
Yes🇷🇺 Russia144,444,3591.8%
Yes🇮🇳 India1,428,627,66317.8%
Yes🇨🇳 China1,425,671,35217.7%
Yes🇿🇦 South Africa60,414,4950.8%
No🇸🇦 Saudi Arabia36,947,0250.5%
No🇮🇷 Iran89,172,7671.1%
No🇪🇹 Ethiopia126,527,0601.6%
No🇪🇬 Egypt112,716,5981.4%
No🇦🇷 Argentina45,773,8840.6%
No🇦🇪 UAE9,516,8710.1%
-BRICS Total3.7 billion46.0%
-Rest of World4.3 billion54.0%

It’s possible that BRICS could eventually surpass 50% of global population, as many more countries have expressed their desire to join.

Share of Oil Production

Although the world is trying to move away from fossil fuels, the global oil market is still incredibly large—and BRICS is set to play a much bigger role in it. This is mostly due to the admission of Saudi Arabia, which alone accounts for 12.9% of global oil production.

Based on 2022 figures from the Energy Institute Statistical Review of World Energy, BRICS’ share of oil production will grow from 20.4% to 43.1%.

Original BRICS
Member
CountryThousand Barrels
per Day
Share of Global (%)
Yes🇧🇷 Brazil3,1073.3%
Yes🇷🇺 Russia11,20211.9%
Yes🇮🇳 India7370.8%
Yes🇨🇳 China4,1114.4%
Yes🇿🇦 South Africa00.0%
No🇸🇦 Saudi Arabia12,13612.9%
No🇮🇷 Iran3,8224.1%
No🇪🇹 Ethiopia00.0%
No🇪🇬 Egypt6130.7%
No🇦🇷 Argentina7060.8%
No🇦🇪 UAE4,0204.3%
-BRICS Total40,45443.1%
-Rest of World53,39456.9%

It’s worth noting that China has been pushing for oil trade to be denominated in yuan, and that Saudi Arabia’s acceptance into BRICS could bolster this ambition, potentially shifting the dynamics of global oil trade.

Share of Global Exports

The last metric included in our graphic is global exports, which is based on 2022 data from the World Trade Organization. We can see that the BRICS expansion will grow the group’s share of global exports (merchandise trade) to 25.1%, up from 20.2%.

Original BRICS
Member
CountryExports (USD billions)Share of Global (%)
Yes🇧🇷 Brazil3341.3%
Yes🇷🇺 Russia5322.1%
Yes🇮🇳 India4531.8%
Yes🇨🇳 China3,59414.4%
Yes🇿🇦 South Africa1230.5%
No🇸🇦 Saudi Arabia4101.6%
No🇮🇷 Iran730.3%
No🇪🇹 Ethiopia3.90.02%
No🇪🇬 Egypt490.2%
No🇦🇷 Argentina880.4%
No🇦🇪 UAE5992.4%
-BRICS Total6,25925.1%
-Rest of World18,64674.9%

Unsurprisingly, China is the world’s largest exporter. Major exporters that are not a part of BRICS include the U.S. (8.3%), Germany (6.6%), the Netherlands (3.9%), and Japan (3.0%).

Who Else Wants to Join?

According to Reuters, there are over 40 countries that have expressed interest in joining BRICS. A smaller group of 16 countries have actually applied for membership, though, and this list includes Algeria, Cuba, Indonesia, Palestine, and Vietnam.

As the group grows in size, differing opinions and priorities among its members could create tensions in the future. For example, India and China have had numerous border disputes in recent years, while Brazil’s newly elected President has sought to “kickstart a new era of relations” with the U.S.

One thing that is certain, however, is that a new acronym for the group will be needed very soon.

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