Localising international development responsibly
Despite the popular narrative that the end of Northern hegemony over international development agendas will empower the global South, we are witnessing a disastrous exit by North American and European organisations from development cooperation and humanitarian aid. As the post WW2 aid project comes crashing down, I set out what responsible localisation of development could look like if the international community works together in solidarity.
Brief history of retrenchment of aid and localisation movement
It is strange we did not see it coming sooner: The paradoxical coming together of two incompatible ideologies. A growing nationalistic and isolationist movement in the US and Europe, committed to putting domestic priorities first and a progressive movement in the global South, advocating for cognitive justice and equitable development. Their values could not be more different but their pathways to change share a common dimension: The defunding of development agencies, global research organisations and international NGOs located in high income countries. However, the dramatic shift in the funding landscape is not empowering anyone, whether in London or Lilongwe. Instead, it is creating a funding vacuum that could cost the lives of millions and irreversibly set back action against rising inequalities and climate change. I explore these issues by setting out a brief history of the retrenchment of international aid and the parallel movement to localise development.
2008 Financial crisis and the start of the decline
Since the 2008 financial crisis, the international development and humanitarian sectors, once characterised by sustained growth, have experienced a prolonged period of structural stress. This has had a disproportionate impact on smaller organisations. My own experience of this was with the UK charity EveryChild, that campaigned for family based care and delivered services to vulnerable children through its local partners in Africa, South Asia, Latin America and Eastern Europe. Back in 2010, we found ourselves with a bleak financial outlook and the board took the decision to close the UK charity and transfer all its assets to a new global advocacy network, Family for Every Child, which is still going strong. Even major organisations like Oxfam GB, Save the Children UK and World Vision USA revised down their fundraising plans during this period as corporate donors in the financial sector withdrew their support. At this stage, bilateral and multilateral donors such as DFID, USAID and the UN system were still holding relatively steady, providing some buffer.
2010 – 2019 The Austerity era
In the UK, despite increased overall ODA spending and the 0.7% GNI commitment being written into law, austerity measures simultaneously required DFID to maintain staffing levels while pruning operating budgets, leading to larger grants being awarded to the biggest development NGOs. By 2015, the disparagingly named BINGOS, (Big international NGOs spending more than £100 million each), received on average, over 200% more government funding compared with 2010. In contrast, many small and medium sized charities closed their operations with average decreases in government funding of over 30%.
2020-2024 Covid and austerity part 2
The UK government’s decision in 2021 to reduce ODA from 0.7% to 0.5% of GNI marked a significant rupture for British INGOs. FCDO’s bilateral programme budget dropped dramatically — from what had been around £7.7 billion bilaterally under DFID in 2020 to significantly reduced allocations, with NGOs describing the cuts as not “salami slicing” but a “bulldozer” approach. Specific consequences included: Sightsavers losing £43 million, putting 72 million medical treatments at risk; the Tropical Health and Education Trust losing £46 million (100%) of its UK Partnerships for Health Systems programme (Source Bond).
Across Europe, similar dynamics were playing out. German ODA fell in 2023 for the first time since 2019. In late 2024, the Dutch government announced plans to cut grants to civil society organisations by around two-thirds, from €1.4 billion for 2021–2025 to between €390 million and €565 million for 2026–2030 — a move the sector described as “devastating and unprecedented.”
2025 Systems shock
The closure of USAID in 2025 and simultaneous retrenchment by the UK, Germany, France, the Netherlands, Sweden and others represented a qualitative shift from earlier phases. For the first time, France, Germany, the United Kingdom, and the United States all cut their ODA simultaneously for two consecutive years. ODA in 2027 is projected to fall back to 2020 levels (Source OECD).
As of April 2025, 81 NGOs had closed at least one office. Save the Children US had one-third of its funding frozen. In February 2025 alone, 10% of humanitarian NGO workers globally were laid off. The scale is significant: about half of USAID’s funding was previously channelled through nongovernmental organisations, and the US spent US$32 billion on foreign aid in 2025 — less than half of the $68 billion it spent in 2024 (Source: The Conversation).
Calls to localise and decolonise development
Another distinctive feature of the post-2008 landscape is the emergence of explicit legitimacy challenges to INGO and international development models that go beyond simple financial pressure. INGOs have faced challenges including sexual exploitation scandals, accusations of white-saviourism, and ever-louder demands to “decolonize” and shift power and resources more directly to local actors. Inequitable knowledge systems and North-South research partnerships have also been heavily criticised and blamed for failing programme interventions (Source: Institute of Development Studies).
In some cases, funders have now heeded these demands, turning away from INGOs and Northern based development and research organisations altogether. As early as 2016 the Grand Bargain commitment made at the World Humanitarian Summit called for the direction of 25% of funding to local actors by 2020. This provided the normative framework within which many donors began to frame reductions to Northern INGO funding. Research donors began insisting on research leadership, or at least co-leadership, from the global South and some went further. The International Development Research Centre (IDRC) set a target for 90% of its funding to be allocated directly to Southern based research organisations and think tanks.
However, evidence of genuine progress is thin. The Grand Bargain target remains unmet five years past the initial deadline. In practice, only 1.2% of total humanitarian funding went directly to local organisations in 2022 (Source: allafrica.) INGO’s and research organisations have become exceptionally skilled at talking about change while resisting transformation, with organisations trapped in cycles of perpetual reinvention in which every few years new language emerges: Decolonisation, reimagining & recasting development, equitable partnerships, localisation, participation — without substantive change.
Nonetheless, the decolonising development agenda and shifting geo-politics has been cited by some Northern development organisations’ as forming part of their decisions (further than purely financial factors) to close or scale back operations. Many are experiencing declining relevance as the countries they operate in graduate to middle-income status and develop stronger domestic civil society that rightfully claims its space. This does not just affect service delivery but the policy and advocacy role of international organisations also. Undeniably strong evidence recommends that big advocacy-led impact depends on local embeddedness. Covid-19, which grounded international organisations, provided the perfect opportunity for local and national actors to demonstrate the power of their legitimacy and understanding of regional and local political economy (Source: Ordonez & Georgalakis, IDS Bulletin). This is no longer just an abstract, values based or moral argument: Pragmatically, localisation is the key to having more impact.
The aid cuts – localisation paradox
Donors now invoke localisation to justify cuts to Northern INGOs, development agencies and research but the resources are not actually flowing to Southern civil society at the scale needed. As it stands, the majority of aid funding still ends up in the hands of Global North organisations, and the shortfall from donor retrenchment cannot be offset by other actors, with donors increasingly shifting priorities from development aid towards strategic national interests, notably migration control and defence (Source: New Internationalist.) Despite the plethora of global meetings taking place in 2026 to discuss the future of development, and some agreement on the need for northern organisations to “get out of the way” this fundamental issue of resources remains largely ignored (Source IDS).
The decolonisation and localisation literatures have long argued that Northern INGOs and development agencies crowd out local civil society — both financially (by absorbing donor resources that could go directly to Southern organisations) and in terms of policy voice and programmatic space. Back in 2010, the five largest INGOs had revenue of $6.7 billion and around 90,000 staff worldwide — their major presence in developing countries often dwarfed smaller, Southern organisations both in programme delivery and in policy discussions. There is thus a theoretical argument that the current collapse of global aid funding architecture and destabilisation of the multilateral system, including INGO withdrawal, will free up space, resources, and institutional recognition for local actors (Source: Devpolicy.)
However, the weight of evidence from the current funding crisis strongly suggests that the conditions for productive transition are not present. The core problem is that the funding is not flowing to Southern civil society even as Northern INGOs withdraw — it is simply disappearing. Furthermore, the cuts are hitting local and Southern civil society organisations directly, not just Northern intermediaries. The most exposed organisations are locally led women’s organisations and community-based groups — which lack the reserves, alternative revenue streams and institutional relationships to absorb sudden funding loss. Local organisations that received sub-grants through Northern INGOs lose access to those flows when the INGO itself is defunded, without any corresponding increase in direct donor access. Therefore, the exit of Northern organisations is producing predominantly negative effects on LMIC-based organisations. This is not the dreamed of localisation of development that was meant to follow the fall of Northern dominance.
The impact on people, jobs and economies
The immediate employment impact of the retrenchment of international aid and development is significant at multiple levels. An estimated 60,000 development workers globally — programme officers, health professionals, teachers, and trainers — are projected to lose their jobs due to the termination or suspension of USAID programmes alone. More than 20,000 American workers and over 200,000 global staff were laid off or left unpaid in the initial stop-work period. At the level of individual organisations, the figures are stark: FHI 360 lost $400 million in revenue and laid off approximately 50% of its workforce; Save the Children shed 40% of staff globally; UNAIDS announced a 54% staff reduction. Johns Hopkins University — one of the largest recipients of USAID-funded global health research contracts — announced plans to cut more than 2,000 jobs after an $800 million cut in funding (Source: Global Policy).
At the country level, the job losses in Southern contexts are equally severe. In South Africa, approximately 8,000 health workers were laid off following the withdrawal of over $430 million in US health aid. In Ethiopia, approximately 5,000 workers focused on HIV and malaria prevention, vaccination programmes and maternal and child health have lost their jobs. In Uganda, reductions in USAID support led to the closure of community clinics and job losses among midwives, nurses and programme coordinators.
For the UK specifically, the international development sector makes a quantifiable contribution to the domestic economy through employment, research, and contract work. FCDO reform plans include staff reductions of between 15% and 25%, which the House of Commons International Development Committee has argued could produce irreversible losses of expertise. The broader UK NGO sector employs tens of thousands of people, generates significant export income through consultancy and programme management contracts, and supports a substantial research and university ecosystem through FCDO and UKRI funding — all of which is now under serious pressure.
Of course, the most serious impact of these cuts is on lives and development outcomes foregone. A study co-authored by UCLA researchers estimates that USAID cuts alone may lead to more than 14 million additional deaths globally by 2030, including more than 4.5 million children under five, reflecting the projected consequences of halting funding not only for health services but also for nutrition, education, water and sanitation and humanitarian relief. The Centre for Global Development estimated between 500,000 and one million additional deaths in 2025 alone.
A responsible model of localisation
Where Northern INGO and development agencies’ withdrawal is planned, phased, and accompanied by deliberate capacity transfer and direct donor relationships, local organisations can be strengthened. Bond’s 2025 collection of case studies on “locally led development” documents examples from HelpAge International, Link Education and Avert, though these are predominantly cases of deliberate transformation rather than crisis-driven exit. Periods of Northern NGO retrenchment have also historically coincided with surges in locally driven activism and social movements: movements can be bolder and more responsive to urgent crises when freed from the constraints of donor priorities or bureaucratic timelines (Source: Democracywithoutborders).
Protecting beneficiaries and continuity of services
The most fundamental concern is the harm caused to programme recipients by abrupt withdrawal. EveryChild’s responsible exit principles — developed as the organisation wound down — emphasised: ensuring that work done is sustainable; ensuring the exit does not have a detrimental effect on the children and communities where they work; and ensuring that expertise and momentum for change in the country is not lost. These three principles reflect the most commonly cited concerns in the practitioner literature, but putting them into practice requires time, investment, and trust relationships that are frequently absent in crisis-driven closures ( INTRAC.)
There is a small but growing literature on responsible exits and transitions. The “Stopping as Success” (SAS) research programme, which ran from 2017–2020, identified a crucial distinction between exit (complete withdrawal without transfer of ownership) and transition (which involves genuine transfer of programmes or organisational structures to local actors). More shared best practice and practical examples are needed of responsible partnership transitions, particularly when donors rapidly shift priorities or withdraw funding (Source: USAID).
Institutional knowledge
Perhaps the least-visible but in some ways most serious long-term concern is the destruction of knowledge infrastructure. The dismantling of USAID included taking its Development Experience Clearinghouse offline — a repository containing over 200,000 project documents accumulated over six decades, of which only 110,000 files were later recovered. Decades of programme data, evaluation evidence and institutional memory cannot easily be reconstructed (Source: DevelopmentAid)
The responsible exit literature notes a significant absence of post-closure evaluation. Development actors love words such as “legacy”, “impact” or “change”, and like to think their work prevails long after they are gone — but explorations of post-closure evaluation find that not many organisations go back after an exit is complete to check. EveryChild is one exception, having commissioned INTRAC to conduct systematic post-closure evaluation. This gap means the sector accumulates very limited learning about what responsible closure actually looks like in practice (Source: INTRAC).
Working together towards a better localisation of development
For me, as someone who has spent over 20 years working in international development, first in INGOs and then in research, the most urgent question is: Where does all this leave international solidarity on climate change, inclusive economies and social justice? For all its deep faults and coloniality, international development and aid was built on a common understanding of what good change could look like. As our sector is torn asunder, impacting directly on the most marginalised communities and stripping away commitments to address global challenges, where do we go from here?
One thing we can do is seek to localise development more responsibly. This is not just a challenge for those of us in the global North. It is a project that requires everyone to listen, work together and take brave decisions. Assets can be transferred, institutional knowledge can be managed and protected, new networked and locally governed structures can be created, and new resources can be identified. Most of all, as we decentralise programme leadership, research and policy engagement we can protect, and where necessary rebuild, global movements committed to development cooperation and mutual learning.
Disease outbreaks travel across borders, environmental disasters have a lasting impact on whole regions and global trade agreements directly affect national climate action. I hope the next era of international development will be characterised by responsible localisation and new forms of global cooperation, in which all voices are valued equally.