Philanthropy and remittances from the developed to the developing world dwarfed government aid in 2010, a new report from the Hudson Institute's finds.
According to the annual (36 pages, PDF), private financial flows — including philanthropy, remittances, and capital investments — from developed nations to developing ones totaled $575 billion in 2010, the most recent year for which data are available, while government aid over the same period totaled $128 billion, one of the highest totals ever, though still only 18 percent of overall financial flows from the developed to the developing world.
The report also found that philanthropic giving from the U.S. to the developing world grew to $39 billion in 2010, while remittances increased to $95.8 billion and, in what was a major recovery, private investment capital jumped to $161 billion. At the same time, while U.S. government aid increased to a high of $30.4 billion, it accounted for only 9 percent of the country's total economic engagement with the developing world.
"Our new data suggest that the ever-growing foreign aid architecture of private actors, transparency, and empowered local citizenry may well be making inroads against poverty in ways that surprise even the experts," said Center for Global Prosperity director Carol Adelman. "The recently-released found a broad reduction in poverty around the world over the last thirty years and confirmed that, contrary to predictions by the World Bank itself, the global recession did not increase poverty in developing countries."