The humanitarian aid model rooted in international solidarity is no longer effective. The dissolution of the U.S. Agency for International Development by Donald Trump — in addition to a reduction of one-third of the total global aid budget — was a turning point. Accordingly, the risk that Russia and China could seek to fill the vacuum in pursuit of their own interests is real.
Europe faces a decisive moment, as it negotiates its next long-term budget. The European Commission has proposed increasing funding for external action under the Global Europe Instrument from 79.5 billion euros in the current Multiannual Financial Framework to 200 billion euros in the 2028-2034.
The outcomes of the discussions between the Commission and the European Parliament on the design and the financial scale of the Global Europe Instrument will shape how funds for humanitarian and development aid are allocated for years to come.
Advancing the European Union's strategic interests should go hand in hand with boosting development cooperation with partner countries — an approach that has delivered results in the past and can both reinforce the EU's global influence and benefit its allies.
To implement this strategy, the EU must learn from the failures of the past.
Its aid model has fallen short in three ways. First, progress in areas such as health and education, aid has too rarely delivered the outcome that ultimately matters the most: enabling recipient countries to become prosperous enough to move beyond foreign support. One example is the EU's investments in Kenya, which the bloc's own audit found lacked sufficient evidence that they had genuinely reduced poverty.
Second, because successes remain the exception rather than the rule, aid has lost much of its political support in donor societies, where voters increasingly question strategy, effectiveness and accountability. Recent polling highlights this skepticism: fewer than one in three Europeans think that the EU has the right priorities for its international aid investments.
Third, the implementation of aid projects has often fallen short of efficiency standards, with overhead expenses in many countries remaining simply too high. In the U.S., 42% of development aid went to paying salaries. In the EU the share is lower, but aid budgets still cover significant administrative costs.
European reboot
Development cooperation can strengthen Europe's security and prosperity. A recent study by the Kiel Institute has delineated a roadmap for how European countries can make aid more mutually beneficial for donors and recipients and restore its legitimacy.
The starting point is simple: Europe should fund projects able to create joint returns for both partner countries and European citizens. That means being explicit about two questions before money is committed: does a program plausibly move a country toward self-sustaining growth? And does it reduce risks or create opportunities that Europeans can recognize, whether by greater stability, lower cross-border risks, or stronger economic ties? If either side of that case is weak, the program should not be implemented.
EU development policy has frequently promised too much and demanded too little, setting broad goals while underestimating how many outcomes depend on local incentives and reform.
Vocational education and training — aimed at reforming and strengthening education systems in less developed countries — is a good example. It can increase employment, lift the economy and drive lasting change if it is tied to employer demand and backed by reforms that allow firms to invest and hire.
This is exactly what happened when Germany invested its aid budget in vocational training in Vietnam. Working closely with the Vietnamese government, German vocational training was aligned with the needs of industry and service sector, boosting employment prospects and filling job gaps.
However, without these conditions, training programs may help individuals at the margin, but they do not change the trajectory of the economy.
Therefore, Europe should become more selective and more predictable. Selective, because scarce concessional resources should be directed where they can plausibly trigger transformation. Predictable, because reformers need confidence that progress will be rewarded with reliable, multi-year cooperation rather than one-off projects.
Securing clear and measurable benefits for both sides is key, as it guides the choice of partner countries and sectoral priorities. European donors should harness incentives, by making it clear that if both sides will benefit and the partner is committed to reforms, they will commit to reliable, long-term funding.
South Korea's development trajectory exemplifies this dynamic. In the second half of the 20th century, Seoul coupled long-term external support — primarily from the U.S. — with domestic reforms, using aid to boost internal economic and institutional capacities. The result was South Korea's transformation from an aid recipient into a partner and critical geopolitical ally for donors. Today, South Korea invests extensively in international development, allocating around $3.9 billion in 2024.
Response to the vacuum
This is the mindset Europe needs now. Trump's withdrawal has opened a historic gap in development cooperation. Europe may not be able to match it euro for euro, but it can respond by using its funds more strategically and effectively.
If Europe hesitates now, others such as China and Russia will fill the vacuum on their own terms. But Europe's response should not be to imitate a transactional model driven narrowly by self-interest.
Instead, the EU should offer a transparent, rules-based partnership that delivers measurable joint returns for Europe and its partner countries. This would create lasting support at home and abroad and ensure that development cooperation remains a powerful instrument in Europe’s toolkit.
Sign up to The Parliament's weekly newsletter
Every Friday our editorial team goes behind the headlines to offer insight and analysis on the key stories driving the EU agenda. Subscribe for free here.