International Development Agencies and Developing Countries

  • Komla DzigbedeEmail author
  • Rubayat Jesmin
Living reference work entry



International development is an active process of engagement between nations by which developed countries extend critical economic, financial, and technical resources to developing nations to reduce poverty and inequality and improve health, education, and employment opportunities in developing regions. International development agency refers to the coordinating department or unit in a developed country that oversees the country’s international development program in developing countries.


International development agencies play an important role in reducing the wealth gap between developed and developing nations. They extend technical and financial resources from developed country governments to developing nations and work with civil society organizations and local communities in developing countries to provide resources in critical sectors and promote development at the micro-, meso-, and macro-levels. Developed countries distribute international development assistance through multilateral international organizations (e.g., the World Bank) and international development agencies (e.g., US Agency for International Development).

Among the top donors in international development assistance are the United States, the United Kingdom, Japan, Germany, France, and Canada. Between 2011 and 2015, these countries together contributed $102.5 billion in development funding, compared to 756.7 billion contributed by all donor countries. Additionally, the top five recipients of international development funding are Afghanistan, Syria, Vietnam, Ethiopia, and Egypt; these countries received development assistance amounting to $100.3 billion between 2012 and 2016, representing 13.3% of total funding to low- and middle-income countries (Organization for Economic Cooperation and Development 2019).

This essay explores the main priorities and achievements of international development agencies in developing countries. It also discusses critical challenges in international development and describes specific ways international development agencies can build effective partnerships with developing nations to promote sustainable development. The discussion focuses on two international development agencies, namely the US Agency for International Development (USAID) and the United Kingdom Department for International Development (DFID).

Major Priorities

USAID and DFID programs focus on key sectors such as agriculture, health, and education and extend to democracy and good governance, disaster relief, and trade and private sector development. Agency interventions consider that forward and backward linkages in specific sectors can enhance the impacts of programs on households, communities, and the macroeconomy in developing countries.


The US government, under the Foreign Assistance Act of 1961, established USAID to administer international development and humanitarian efforts worldwide and promote America’s good among foreign countries. USAID’s major areas of focus in development assistance are agriculture and food security, democracy, human rights and governance, economic growth and trade, education, environment and climate change, gender equality and women’s empowerment, health, water and sanitation, and crisis and conflict management. Table 1 shows the distribution of USAID funding among these program areas in 2017.
Table 1

USAID funding in priority sectors (2017)

Program area

Amount (million dollars)

Share of total (%)

Economic growth (including agriculture)



Humanitarian assistance






Democracy, human rights, and governance



Education and social services



Program development and oversight



Peace and security



Source: USAID (2018)


The United Kingdom established DFID in 1997 as a ministerial department to take the lead in the government’s work of tackling the global challenges of poverty and disease, conflict and insecurity, and mass migration. The agency’s mandate is supported by several legislations, including the International Development Act (2002) and the International Development Reporting and Transparency Act (2006). DFID’s work in developing countries focuses on agriculture, education, environment, government and civil society, humanitarian aid, and industry. Table 2 lists the amount of funding to each program area in 2017.
Table 2

DFID funding in priority sectors (2017)

Program area

Amount (million euros)

Share of total (%)

Humanitarian aid






Government and civil society



Multisector or cross-cutting






Economic infrastructure and services



Production sectors



Administrative costs of donors



Refugees in donor countries



Other social infrastructure and services



Water supply and sanitation






Source: DFID (2018)

Recent Achievements

Agency records show that USAID contributed significantly toward the sustainable development goals of all 142 countries in its global outreach in 2017. It achieved impacts across many sectors, including agriculture, conflict, peace and security, disaster prevention, preparedness and response, education, health, infrastructure, and environment (USAID 2018). Agricultural sector programs produced tangible benefits for farmer households and communities. Under the Feed the Future global food security program, the area of land under improved technologies reached 6.2 million hectares, and the number of farmers who applied improved technologies or management practices totaled 10.9 million. Also, many communities benefitted from expanded markets and trade as the value of agricultural and rural loans grew to $623.7 million and smallholder incremental sales amounted to $906.1 million. Overall, 8.2 million households benefitted directly from the Feed the Future program.

In the health sector, USAID established 2743 health facilities with the capacity to manage acute undernutrition. It reached 27.6 million children under 5 years with nutrition programs and 4.9 million pregnant women with nutrition-specific interventions. Additionally, 1.6 million individuals gained access to safely managed sanitation services and 2.5 million people obtained access to basic drinking water services.

The educational sector achieved impacts at both the basic and post-secondary levels. USAID interventions resulted in 23 million learners enrolling in primary schools and equivalent non-school based settings, and 19 million learners received primary-level reading interventions. Children in primary grades that achieved improved reading skills as a result of primary education interventions totaled 828,000. Further, the agency built or repaired 354 primary or secondary classrooms, developed the capacity of 267 tertiary education institutions, and developed workforce development programs that resulted in 53,000 people receiving new or better employment.

Similarly, DFID reports show that the agency’s programs in developing countries resulted in 28.7 million children immunized and 475,000 lives saved between 2015 and 2016. The number of children under the age of 5, women of childbearing age, and adolescent girls the agency reached with nutrition-related programs totaled 26.3 million. The agency also supported 27.2 million individuals to gain access to clean water and better sanitation services, and through its primary education intervention programs, a total of 7.1 million children gained decent education (DFID 2018).

Additionally, as part of its strategic priority to strengthen global peace, security and governance, DFID supported 30 countries to manage their public finances, including natural resources and extractives, more transparently. It supported freer and fairer elections in 13 countries and empowered 81.1 million people, including 31.0 million women, to have choice and control over their own development and hold decisionmakers accountable in governance. The agency also enabled ten million women to access justice through the courts as well as gain improved access to police and legal assistance in matters related to domestic violence and abuse, land ownership, and family inheritance.

DFID also strengthened resilience and response to crises worldwide as it reached 17 million individuals, including 7.3 million women and girls, with humanitarian assistance. It provided timely assistance to people dealing with the consequences of armed conflicts, famines, floods, and typhoons in countries like Afghanistan, Ethiopia, Malawi, Pakistan, Somalia, Syria, and Yemen. Also, it responded effectively, alongside other international development agencies, to contain the Ebola crisis in West Africa.

Critical Challenges

Academic scholars and development practitioners alike have highlighted multiple challenges and concerns about the work of international development agencies in developing countries. These challenges span politics, economics, and public management.


Donor allocation of resources is sometimes driven more by political considerations and at the expense of real need for funds in developing countries. It has been argued that national security and commercial interests of donor countries sometimes take priority in resource allocation, and with the growth in terrorism worldwide, some donors tend to channel resources mainly to poor nations that align with political and ideological interests of donors (Gill and Law 1989; Addison et al. 2015). Another concern is the use of international development assistance as a mechanism for gathering information about recipient countries, which undermines the strategic interests of recipient countries at the global level (Amsden 2007). Moreover, in many instances, bilateral assistance packages are delivered to developing countries without much political awareness that these countries are diverse in geography, history, culture, resources, government, population size, and economic structure and that what works in one country might not work in another jurisdiction.

Economic and Institutional Problems

Corruption is a problem in international development. It is driven by both demand and supply side causes. At the demand side, most developing countries lack adequate regulatory and institutional control systems to ensure transparency of rules and contracts, enforce effective penalty systems, and ensure swift judicial processes (Mele 2014). These institutional weaknesses create incentives for local contractors and consultants to pay bribes to government officials for contracts, and in some instances, contractors inflate the costs of development projects and submit bills for substandard work (Quibria 2017).

Donors contribute to corruption from the supply side. When seeking lucrative procurement contracts, some big corporations in donor countries, operating under a vast network and camouflage of subsidiaries, affiliates, and advisers, engage in corrupt and unethical practices, including making questionable and illegal payments to government officials and political parties in developing countries, and compromise laws and international treaties (Sikka and Lehman 2015).

Aside from the problems of corruption, international development assistance often lacks supporting and coordinating investment in the public and private sectors, and this poses a severe economic challenge that hinders growth and development (Amsden 2007). Food monetization is also a problem. Donor countries’ sale of food aid commodities in local markets to generate funds for international agricultural assistance harms local producers as it decreases prices and disrupts local markets (Barrett and Maxwell 2005).

Program and Project Management

International development programs and projects sometimes lack proper alignment with the policy priorities of recipient countries. Advocates have argued for international agencies to synchronize better their programs and projects with local preferences and utilize longer commitment horizons that embed the longer-term development priorities in recipient countries (Rogerson 2005). Experts have also argued for programs and projects to have the national branding of recipient countries, which is an important expression of soft power and is needed to assert local norms and promote recipient countries as partners of choice (Pamment 2018).

Another challenge is that programs and projects make minimal use of country financial systems and local actors and, in most cases, the reach and effectiveness of projects could be improved. A recent study of USAID agricultural projects in Ethiopia, Ghana, Haiti, Senegal, and Tanzania finds that nonprofit organizations and for-profit corporations in the United States play the role of lead implementers and local organizations serve only as subcontractors to lead international actors; therefore there is limited use of local financial systems in delivering agricultural interventions (Tumusiime and Cohen 2017). Moreover, the impact of some of the agricultural technology innovations (high-yield seeds) was limited because farmers lacked the cash or credit to purchase complementary inputs, including labor, to expand production.

Building Effective Partnerships

International development partnership involves many stakeholders. Representative individuals, agencies, and departments of national and local governments, nongovernmental organizations, local communities and community-based organizations, private sector organizations, and international donor governments and their agencies are all important stakeholders (Brinkerhoff 2002). Each stakeholder contributes unique assets and skills toward sustainable development goals. National governments provide an enabling macroeconomic environment and legal and institutional framework as well as technical and financial resources. Local governments give support to program and project implementation at the micro-level, whereas nongovernmental organizations and community-based organizations mobilize local resources and support in local communities. As for international donors and agencies, they provide critical technical and financial resources, foster public-private sector partnerships, and stimulate action toward host country development goals and global sustainability priorities.

Partners in development often have divergent goals and motivations, but an effective partnership builds on trust, transparency, accountability, reciprocity, and respect and works to enhance cooperation and complementarity to achieve mutually agreed development goals (Schaaf 2015). In developing countries, national governments have an important role to play in achieving effective partnerships for sustainable development. One way is for national governments to provide an enabling macroeconomic environment and legal and institutional context that enhance development policy credibility. Research shows that a suitable mix of macroeconomic and institutional policies should combine fiscal discipline and leadership with monetary policy targeting low inflation and employment growth over time and anchor policy credibility in market expectations (Dzigbede 2016). Another way is for national governments to increase their political commitment toward mutually agreed sustainable development strategies. Roberts and Andrews (2005) describe how national and local budgets may not fully reflect mutually agreed development priorities, and especially during election years, government spending patterns may diverge from stated goals and create severe fiscal policy shocks that can constrain long-term economic development. It is also likely that the rhetoric of developing country governments in the international development space may not be backed by their operational support at the local government level.

International agencies must also play a significant role in building effective partnerships for development. A common challenge is the lack of adequate fit between international development assistance and the problem structure in developing countries. International agencies sometimes adopt a single set of solutions across developing countries, but more effective partnerships would require that international donors invest in tailored solutions that recognize macroeconomic and institutional setups, local administrative conditions, and political constituencies in specific countries and leverage the comparative advantages of all stakeholders to promote sustainable development in a country (Pattberg and Widerberg 2016). Additionally, a greater level of accountability, transparency, and trust is needed to allow host governments and international agencies to pool resources, disburse funds, and coordinate activities to achieve greater impacts on development.

Finally, the role of the private sector cannot be overemphasized. Public-private partnerships provide a unique way to achieve government goals of socioeconomic growth and redistribution together with business sector goals of managerial efficiency and global competitiveness (Houghton 2011). However, in the international development landscape especially, the business sector emphasis on market efficiency and program performance must be weighed carefully such that it does not constrain long-term goals of social accountability, equity, and justice.


This entry examined the main foci of international development agency programs in developing countries. It focused on USAID and DFID and tracked their achievements across priority sectors in developing countries. The entry discussed key challenges and concerns about international development effectiveness focusing on politics, institutions, and program management. The essay recommends that developing country governments, international development agencies, and private sector organizations all should strive toward making their partnerships more effective and aligned with sustainable development priorities in poor nations.



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© Springer Nature Switzerland AG 2019

Authors and Affiliations

  1. 1.Department of Public AdministrationBinghamton UniversityBinghamtonUSA