Rising geopolitical tensions expected to reduce official development assistance to Africa
The world has lately been embroiled in geopolitical skirmishes and tensions that many believe would affect Africa in many ways, and one of them is the reduction of official development assistance to the continent.
Unfortunately, while Africa has been dependent on ODA, it has been known that the continent loses much more money to illicit financial flows than it gets from ODA.
It is reported that over the past five decades, Africa has experienced an estimated loss exceeding $1 trillion in illicit financial flows —an amount roughly equivalent to the total official development assistance the continent received during the same period, but due to the current uncertainty in global politics, ODA is likely to reduce.
According to the African Development Bank (AfDB’s) African Economic Outlook 2026, the reduction is heightening near-term risks to overall external financing.
The Outlook was launched during the African Development Bank Annual Meetings ongoing in Brazzaville, Congo from May 25 to 29, 2026, under the theme: Mobilising Africa’s Development Financing at Scale in a Fragmented World.
In 2024, remittances to Africa increased to $104.6 billion from $91.6 billion in 2023. Over the same period, Foreign direct investment (FDI) rose from $55.4 billion to $97.0 billion, and net portfolio investment switched from outflows of $1.6 billion to inflows of $22.9 billion, the Outlook said.
It however notes that ODA increased as well, from $61.7 billion to $65.9 billion, mainly driven by higher multilateral aid that offset aid cuts by major bilateral donors.
“With donors reallocating resources toward domestic and strategic foreign policy priorities, the decline in bilateral aid is likely to persist, and multi-lateral aid may also come under pressure, since these shifting priorities could reduce contributions to multilateral institutions,” it said.
According to the Outlook, escalating geopolitical fragmentation has stoked volatility in global commodity and financial markets, straining fiscal positions, exacerbating debt vulnerabilities, and heightening the risk of portfolio flow reversals.
The current global supply chain shock could weaken labour market conditions in the Middle East, which accounts for 14 percent of African migrants, it said.
This poses a risk to remittance transfers to Africa. These trends strengthen the case for African countries to reduce dependence on external sources and explore domestic opportunities to mobilize resources to finance their development, it added.
By Emmanuel K Dogbevi, in Brazzaville, Congo