'Beyond Aid' and the Future of Development Cooperation

Development cooperation is under pressure to change. The traditional aid model – a resource transfer from North to South – is outdated. There are only 36 low-income countries left in the world. Two-thirds of the poorest people live in middle-income countries. Eradicating poverty has become more complex. Aid is no longer used to only address income poverty but also a large variety of development challenges, including climate change, inequality and insecurity. Many of these challenges need to be addressed outside the traditional development cooperation sphere. Currently, it is not clear what will replace traditional aid. Observers often speak about a beyond aid future. As an umbrella term, beyond aid describes different aspects of the transformation of development cooperation. The transformation is particularly pronounced in four dimensions where aid is decreasing in relative importance: the proliferation of actors, the diversification of finance, the shaping of rules and policies, and the sharing of knowledge for development. Development cooperation needs to learn how to link up to these dimensions of beyond aid. There are two ways forward that are not mutually exclusive: development cooperation can specialise in a shrinking number of poor countries or integrate into the broader framework of international cooperation to address a wider range of global challenges. How development policy makers and their agencies respond to the changing global landscape will have important consequences for their operations.