Author: Richard Manning.

Responding to the recent upsurge of interest in ‘emerging donors’, this article argues that the DAC share of aid is likely to decline only slowly from what is a historically high level, and at least some non-DAC donors are likely to see DAC approaches and norms as relevant. Nevertheless, low-income countries seem likely to have a wider range of financing options. Three key risks are that: they prejudice their debt situation by borrowing on inappropriate terms; they use low-conditionality aid to postpone necessary adjustment; and they waste resources on unproductive investments. DAC members should develop constructive dialogue with other bilateral donors based on recognition that sustainable development and poverty reduction should be the core purpose of aid.