Five years ago, the foreign aid establishment downplayed the importance of private giving. Now, however, nearly every major international economic institution—from the U.S. State Department to the IMF and the World Bank—recognizes that private development aid is critical to prosperity in the developing world.
The Hudson Institute’s Center for Global Prosperity (CGP), founded in 2005 by Dr. Carol C. Adelman, creates awareness among opinion leaders and the general public about the central role of the private sector in inducing economic growth and prosperity throughout the world. Private financial flows, which include philanthropy and volunteerism from foundations, private and voluntary organizations, corporations, universities and religious organizations as well as remittances, constitute the majority of the developed world’s economic engagement with developing nations.
Our core product is the annual Index of Global Philanthropy and Remittances (.pdf), which details the sources and magnitude of private philanthropy to developing countries. The Index reframes the discussion about the roles of public and private sectors in foreign aid by demonstrating that the full scale of a country’s generosity is measured not only by official development assistance from governments, but also by the many sources of private giving.
The Fifth Annual Index was published in May 2010 and demonstrated that private giving and remittances proved to be resilient, despite the global economic meltdown in 2008.
Internationally, private philanthropy and remittances from the developed to the developing world amounted to $233 billion, nearly twice as much as government aid, which came in at $121 billion. Remittances totaled $336 billion in 2008, a 17 percent increase from 2007.
In the U.S., private philanthropy held steady at $37.3 billion, compared to $36.9 billion in 2007. Remittances from the U.S. to developing countries reached an estimated $96.8 billion in 2008, the single largest U.S. outflow to developing countries.
Dr. Carol C. Adelman, a senior fellow at the Hudson Institute, continues to serve as the director of CGP. We support free societies, including capital markets, rule of law, government transparency, free trade and press, human rights, and private property, all of which we consider prerequisites for international development in today’s globalized world.
The Hudson Institute is a nonpartisan policy research organization dedicated to innovative research and analysis that promotes global security, prosperity, and freedom.