A New Vision for Development Cooperation

Jul 5 , 2025
By Jos A. Alonso

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he global system of financing for development, including that of development cooperation, has failed to keep pace with the vast changes the world has seen in recent decades. That is why participants at the Fourth International Conference on Financing for Development (FfD4) held last week in Seville, Spain, should pursue nothing short of an overhaul of that system.

Existing frameworks for development financing and cooperation can be traced back to 1944, when delegates from 44 countries gathered in Bretton Woods, New Hampshire, to lay the groundwork for a new economic and monetary order for the post-World War II era. While many of the solutions they devised are no longer fit for purpose, the spirit of cooperation that animated the conference is. Now, like then, leaders must recognise that, far from a zero-sum game, international engagement can lay the foundation for shared prosperity.

To get there, a deep review of development cooperation is required. We need a new model of relations among countries, a clearer agenda backed by sufficient resources, and greater coherence within a fragmented system, with the United Nations (UN) at its core.

Through the 1950s, the UN played a central role in the creation of the development-cooperation system. But OECD donors then took over leadership of the system through the Development Assistance Commitee (DAC). With that, bilateral initiatives, financed by official development assistance (ODA), became the predominant mechanism for wealthy donors to support developing countries. Discretionary relationships, non-binding commitments, and neo-colonial legacies prevailed.

This flawed approach is particularly inappropriate today, when the North-South (donor-recipient) dichotomy has given way to a far more complex dynamic increasingly shaped by "new powers," a large group of middle-income countries, and growing South-South cooperation. A more inclusive and responsive model for engagement is needed to leverage the diverse capacities of all countries, promote horizontal partnerships, and frame sustainable development as a collaborative process rooted in shared responsibility.

The second imperative, clarifying the development agenda, requires us to differentiate between priorities. When the international aid system was established, it focused squarely on poverty reduction. Today, development cooperation has advanced at least three other agendas: the provision of global public goods (including a healthy environment), humanitarian action, and the promotion of shared interests.

While these agendas are interconnected, each has its own internal logic: redistributive, addressing externalities, rescue and relief, and reciprocity. Each one should be understood on its own terms if progress is to be made. Financing this expanded agenda will require new resources, not simply a reclassification of existing ones. This means moving beyond ODA to channel a broader range of public funds to sustainable development.

Besides that, the development cooperation system has become more complex and fragmented in the field of operations, which currently includes more than 60 official bilateral agencies, over 200 multilateral institutions and funds, around 500 development banks, and a vast array of NGO networks and foundations. Delivering progress in such a crowded field requires action on three fronts.

Development efforts should be more locally anchored, for example, through the establishment of national platforms where external partners operate under the leadership of local authorities. Multilateral action should be strengthened, promoting better coordinated interinstitutional programs. Lastly, regional mechanisms, such as the African Union (AU) and the Ibero-American General Secretariat, should be supported as they help to promote more localised and layered governance structures.

Beyond this, it is necessary to move toward governance that promotes greater coherence and unity. Though a number of platforms have emerged in recent years to support dialogue among development actors, none of them amounts to a suitable governance structure. The OECD's DAC is effective, in establishing metrics and standards, enabling centralised reporting, and orchestrating a peer-review system that leads to improvements in aid policy, but it is not very representative.

Similarly, the Global Partnership for Effective Development Cooperation and the newly established International Forum on Total Official Support for Sustainable Development lack broad buy-in. Furthermore, they have an excessively narrow focus: the effectiveness and size of financial flows, respectively.

The UN's Development Cooperation Forum (DCF) also has an overly narrow mandate, but it is more inclusive than its counterparts. It, thus, can play a central role in improving the coherence of development efforts, if its mandate is broadened, and its capacity and resources expanded accordingly.

The point is not to destroy old frameworks to make way for entirely new structures, but rather to renew, streamline, and strengthen the existing system, and to establish the UN as its fulcrum. Greater collaboration between the DCF and other platforms, particularly the DAC, should be promoted through joint initiatives focused on metrics, standards, eligibility criteria, and country graduation processes. An inter-agency program can support UN leadership on this process of convergence, ensuring that the competencies of different agencies are being leveraged effectively.

Success is not guaranteed, but progress is possible. And it should begin at FfD4.

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PUBLISHED ON Jul 05,2025 [ VOL 26 , NO 1314]

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