Beyond Aid Cuts: The Forgotten Policies That Still Matter for Development

Many countries are cutting their foreign aid budgets—but development depends on more than just finance. CGD’s Commitment to Development Index (CDI) assesses the world’s most powerful countries on the eight distinct policy areas that matter most to development. Countries score well for things like taking high numbers of refugees and migrants from poor countries; fostering global health security; protecting the climate; and contributing to peacekeeping efforts.

This year’s edition of the CDI, released today, shows that against a backdrop of international conflict and rising trade barriers, countries’ commitments to supporting development is in sharp reverse, with 24 out of 38 countries backsliding in their key policy commitments.

This is particularly prominent amongst development leaders: just one of our top 10 countries, Norway, is doing more than two years ago. Overall, the countries we measure scored worse on five out of eight components, including for policies on finance, trade, and security.

But despite this, there were also positives: corporate tax rates were more aligned with an agreed minimum, making it harder to avoid them; greenhouse gas emissions fell in most countries; and there was an increase in refugees hosted.

We also identify areas of opportunity. Given shrinking aid budgets, NGOs and advocates must broaden the policies that they seek to influence. Rather than arguing over a shrinking pot of aid money, they could shift their focus, for example, to how over $500 billion in research and development (R&D) is allocated, or to removing harmful subsidies for fisheries and fossil fuels.

What does the CDI 2025 show?

For over two decades, the CDI has assessed the degree to which the world’s most powerful countries contribute to international development.

In this 2025 edition of the CDI, six of the ten countries in the top ten went backwards on most of our key indicators, and a further three made no net improvement. Even so, the top countries are still doing more than their peers to support global prosperity and security. Sweden tops the rankings for a third consecutive time with strong scores in environment, development finance, and health, followed by Germany—the highest-ranked G7 country—and Norway, with its top performance on investment. Finland, with high ranks in health and security, and the United Kingdom complete the top five (though it’s important to note that the UK’s most recent aid cuts do not yet feature in the CDI data). The Netherlands dropped out of the top ten for the first time in the history of the CDI, with cuts to development finance and large increases in subsidies for fossil fuels.

In terms of countries stepping forward rather than back, Luxembourg and Ireland have made the most (relative) improvement since the last edition of the CDI, each jumping four ranks. South Africa is the highest-ranked middle-income country (of eight in the index) at 29^th, and overperforms relative to expectations based on its income level by the largest margin in the entire index.

The retreat from development is not only financial

This year’s index is published against a backdrop of major aid cuts. But what about the trend in the wider policies that can accelerate prosperity and security? Here, we look across a key indicator from each of our eight components.

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Overall, of the 38 countries in the index, 24—almost two-thirds—regressed in more key indicators than they improved, and a further three were net neutral. It is notable that, of the top ten ranked countries this year, only one, Norway, saw a net improvement across these measures. The stand-out countries according to these metrics are Japan, South Korea, and New Zealand, each of which improved on at least six of eight key indicators.

Country performance on key indicators

Notes: In each component, the ‘key’ indicator is the one with the greatest weight, except for Investment and Security, where the highest-weighted indicators are less comparable through time.

This story is mirrored in many of the eight components. Average tariff rates applied by CDI countries against exports from lower-income countries are higher in most cases. Consumption of antimicrobials is up in 24 countries, doing little to assuage concerns about the potentially huge impacts of antimicrobial resistance on global health and economic stability. Research and development spending, which totalled over $500 billion across CDI countries—around three times larger than aid spending—has also been in decline in most countries.

On security, we see over half of the countries reducing their peacekeeping contributions and increasing their arms exports. At the time of this analysis, Israel and Russia were each engaged in major conflicts. Both Russia’s invasion of Ukraine and Israel’s military operations in Gaza and the region following the 7 October 2023 attacks have shaped the foreign and security priorities of many CDI countries. Russia’s invasion of Ukraine has had devastating humanitarian and developmental impacts, causing disruption to food and energy markets with knock-on effects for developing countries worldwide. Israel’s military operations in Gaza and the region, and its restrictions on the entry of food, essential supplies, and aid, have had severe humanitarian consequences. As the CDI has limited ability to capture the developmental impacts of such actions and cannot meaningfully quantify or compare the effects of different conflicts, Israel and Russia are not included in the 2025 Commitment to Development Index. Many of the spillover effects of Russia’s invasion, however—such as higher fossil fuel subsidies, diverted aid resources, and food price increases—are reflected in other countries’ scores. (More information on this is available in the methodology.)

There were, however, some bright spots. A great majority of countries have reduced their emissions per head (though increases in China’s emissions outweighed these overall) and host a larger number of refugees per capita. We also saw leadership from some countries—even in the context of energy price spikes, Argentina, Brazil, and Türkiye, among others, managed to cut subsidies to fossil fuels (see Figure 1) and they should be commended for doing so.

The World Trade Organization’s Agreement on Fisheries Subsidies was widely adopted and entered into force this year, and we see most countries reducing their harmful fishing subsidy levels.

What does this mean for those committed to advancing international development?

Many advocates and policymakers currently remain focussed on aid volumes. But if they considered the wider policies that matter to development, could they achieve more? The CDI offers some inspiration, and we’d highlight two particularly promising candidates.

First, R&D presents an ideal opportunity for CDI countries to do more for development consistent with their own self-interest. The major economic and social shocks have been international—from the financial crises, global energy and food price spikes, and climate shocks, to the COVID pandemic. Using a (bigger) portion of R&D budgets internationally and collaborating with researchers in Africa, Asia, and Latin America helps countries whose ability to respond effectively has implications for everyone. And collaboration also avoids duplication, so we can tackle these challenges faster and more effectively.

Second, in a period of fiscal restraint, cutting harmful subsidies is one of the few options that both saves money and tackles damaging distortions. CDI countries still spend over $450 billion on fossil-fuel subsidies. There has been progress on reducing fisheries subsidies, and with food and energy prices now receding, it is becoming easier to do the same for agriculture and fossil-fuel subsidies. The US, as incoming chair of the G20, has relatively low subsidy levels, so it may see an opportunity to push others to reduce subsidies that distort competition, while countries more committed to climate may also see virtue in reductions. This could be an unusually favourable moment to accelerate these subsidies’ decline.

Fossil fuel subsidies increased overall from 2021 to 2022, but some countries reduced them

There are many other measures in the CDI that policymakers and advocates may find opportunities to advance. We urge strategists to look beyond their traditional focus and invest in capability in other areas that matter.

Learn more about what the index says about commitment to development in 2025 in the launch brief here. Explore the rankings in our interactive tool here.