A new study from the Centre for Global Development shows that 24 of the world’s richest nations have cut back significantly on global-development efforts, redirecting funds to domestic programs and defence budgets. The report found that support for developing countries is weakening even as global inequality and climate-related pressures intensify. The shift marks one of the biggest pullbacks in international development policy in more than a decade.

Countries like Sweden, Germany and Finland remained among the top performers, maintaining strong commitments across trade, environmental policy and aid. But the United States, Japan and several European economies slipped in the rankings, reflecting reduced foreign-aid budgets and tougher immigration policies. Analysts say the cuts highlight a growing inward focus among wealthier nations.

For businesses operating in emerging markets, the report signals a new era of reduced financial support and greater uncertainty. Many development projects previously backed by multilateral funding may now rely more heavily on private-sector investment. This could increase costs for infrastructure, agriculture and energy initiatives in lower-income regions.

The shift also raises concerns about long-term global stability. Development specialists warn that reduced engagement from rich nations could widen economic gaps and increase vulnerability in regions already facing conflict, climate risk or debt distress. This may pose indirect risks to global supply chains and trade flows.

Overall, the findings suggest that global-development priorities are being reshaped by geopolitical competition and domestic economic pressures. Businesses and policymakers may need to adjust strategies as development finance becomes more selective and competitive.

Source: Reuters.