Denmark’s thoughts on Development Cooperation and what the country could learn from Germany

A report by the Danish Institute for International Studies examines the future of Denmark’s development cooperation. With limited resources and shifting global priorities, the question arises as to how Denmark can shape its development aid effectively and in a targeted manner. The insights from this report offer valuable lessons for Germany’s development policy.

Focus and Prioritization

The report recommends that Denmark concentrate on fewer countries and sectors to maximize effectiveness. Germany could benefit from this strategy by focusing its development aid on key areas and regions where it has particular expertise and experience. Germany has a wide geographic reach in its development aid, with a strong emphasis on Africa and increasing support for fragile and conflict-affected regions. It is the second largest donor country in the OECD, (following the USA) and providing USD 28.4 billion in official development assistance (ODA) in 2020.

Multilateral Cooperation

Denmark is urged to strengthen multilateral cooperation and increase its engagement in international organizations. Here, Germany could be a role model for Denmark. Germany plays a significant role in multilateral development cooperation and has a strong presence in various multilateral organizations and initiatives. In 2021, Germany provided USD 15.5 billion in gross ODA to the multilateral system, with 65% going to EU institutions and 39% to the UN system.

Innovations and New Financing Sources

The report emphasizes the need to explore innovative approaches and new financing sources for development cooperation. Here, too – Germany provides ODA funding to public-private partnerships (PPPs) specifically for infrastructure projects in developing countries. This includes sectors like water supply, sanitation, and basic drinking water systems. The German Investment and Development Company (DEG) is a key mechanism through which Germany channels ODA funds to private sector initiatives and PPPs. In 2021, DEG received around €320 million in ODA funding. German governments  throughout the years emphasized the importance of leveraging public-private and civil society partnerships as part of the Sustainable Development Goal (SDG) 17, which aims to “encourage and promote effective public, public-private and civil society partnerships.”

Conclusion

The lessons from the Danish report underscore the importance of a focused, efficient, and innovative development policy. By embracing these insights and integrating them into its own strategy, Denmark should indeed optimize its development cooperation and make a sustainable contribution to global development. It could learn from Germany here. Nevertheless, the efficiency of development aid in all is under question.