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Wed, July 2, 2025

Fragmentation of development aid dilutes its impact, says PM Oli

B360
B360 July 2, 2025, 12:17 pm
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KATHMANDU: Prime Minister KP Sharma Oli said the fragmentation of development aid across too many small projects, parallel channels and competing priorities had often diluted its impact.

He warned that the shift from grants to loans, even for countries already burdened with unsustainable debt, was equally troubling.

PM Oli made the remarks on Tuesday at a special event convened by President of the Government of Spain, Pedro Sánchez, on ‘Investing in Global Solidarity: a New Vision of Development Cooperation’, held on the margins of the Fourth International Conference on Financing for Development (FfD4).

The event reaffirmed the enduring value of development cooperation at a time marked by resurgent nationalism, growing protectionism and regional and global conflicts.

‘Development cooperation was not a gesture of charity but a pledge to leave no one behind in our shared pursuit of progress,’ he said. ‘It was about partnerships that empowered communities, strengthened institutions, built capacity and fostered resilience.’

He added that development cooperation had represented ‘solidarity in action for lasting peace, shared prosperity, climate justice and the foundations of a just, fair and equitable world’, yet assistance had been declining even as the wealth and income of many advanced economies had continued to rise.

‘And this decline had come when the need was greatest, when countries in special situations faced rising pressures and widening gaps,’ he said. ‘They needed enhanced and sustained global support to overcome mounting challenges and accelerate inclusive growth.’

PM Oli welcomed the Seville Commitment, adopted on Monday, saying it had given new hope, as it was about turning principles into progress through global solidarity.

He called on the international community to translate words into action: ‘We had to deliver on both our commitments and our principles of effectiveness. We had to find innovative ways to mobilise resources and make development cooperation truly meaningful for the lives of people on the ground.’

He concluded that, with developing countries facing mounting financial stress and rising debt, concessional finance ‘was not optional but essential’.

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