PARIS — International financing for developing economies has undergone major shifts over the past decade, with public development assistance providing relative stability while private investment flows have displayed much greater swings, according to statistical data covering 2014 to 2024.

The latest OECD dataset provides a decade-long view of financial resources moving toward developing countries, measured in constant 2024 U.S. dollars. The figures cover a range of funding channels, including Official Development Assistance (ODA), official non-concessional finance, export credits, foreign direct investment and other private flows, civil-society grants and private finance mobilised through official interventions.

The data illustrate a development-finance landscape in which public funding has remained comparatively steady while commercial capital has been considerably more sensitive to global economic conditions.

ODA Provides a Relatively Stable Foundation

Official Development Assistance emerged as one of the most consistent sources of external development finance during the period examined.

Annual ODA remained around the $200 billion level, providing a relatively predictable source of support for governments and development programmes.

Such funding can be particularly important for areas where private investors may be reluctant to commit capital, including social services, basic infrastructure and programmes aimed at improving economic and human development.

The stability of ODA contrasts sharply with the fluctuations observed in several private financing channels.

Private Investment Shows Greater Swings

Foreign direct investment and other private flows experienced substantially greater volatility throughout the decade.

The most prominent disruption occurred around 2020, when global economic activity was severely affected by the COVID-19 pandemic. Private investment contracted sharply during this period before recovering in subsequent years, particularly through 2021 and 2022.

The rebound demonstrates how quickly international commercial capital can respond when economic conditions improve. However, it also highlights the vulnerability of developing economies that depend heavily on private investment to finance long-term growth.

By 2024, FDI and related private flows represented the largest individual component of the financial flows covered by the dataset, underscoring the growing importance of private capital in development financing.

Smaller Financing Channels Remain Relevant

Other forms of international finance played comparatively smaller roles in the overall picture.

Officially supported export credits, grants provided by civil-society organisations and gross private finance mobilised through official development interventions accounted for smaller portions of the overall financing mix.

Although their absolute contribution may be lower than ODA or FDI, these mechanisms can help finance projects and activities that might otherwise struggle to attract sufficient capital.

Development Finance at a Glance

Financing Channel Observed Volatility Broad Role Official Development Assistance Relatively low Provides dependable support for development programmes and public services FDI and other private flows High Major source of commercially driven investment Mobilised private finance Moderate Helps attract additional private investment to development projects

The Challenge of Attracting Private Capital

The decade of data highlights a central issue facing development institutions: how to increase private investment without weakening the stable public financing base on which many developing economies continue to depend.

Private capital can provide enormous resources for infrastructure, businesses, employment and productive investment. However, investors typically respond to economic growth prospects, financial conditions, political risks and expected returns. This can make private flows considerably less predictable than development assistance.

Public development finance can therefore play an important role in creating conditions that encourage private investors to participate, particularly in projects involving significant upfront costs or elevated risks.

A Mixed Picture for Developing Economies

The OECD figures ultimately point to a development-finance system shaped by two contrasting forces.

On one side, ODA has provided a relatively stable stream of resources over the decade. On the other, private investment has demonstrated considerable sensitivity to global economic disruptions, with the pandemic period providing a particularly clear example.

The recovery in private flows following the 2020 downturn is encouraging, but the underlying volatility means that developing economies cannot necessarily rely on commercial investment alone to meet their financing needs.

As countries pursue infrastructure expansion, job creation and sustainable development, the ability to combine reliable public assistance with larger and more resilient private investment flows will remain a major international policy challenge.