Beyond Mergers: Charting Germany’s Development Policy in a Changing World
Stephan Klingebiel explores whether Germany's development agency will go the way of others and merge with another department.
Germany’s political landscape is in a state of flux. Following the coalition’s collapse, key policy decisions will play an important role—not only in the upcoming campaign phase but also in shaping the groundwork for a future coalition agreement that will guide the next federal government. While development policy may not be a top priority, it is under considerable pressure.
Two primary approaches appear to be particularly useful for triggering public debate in Germany on development policy. One is to cite aid projects that may seem odd or unnecessary—such as “Bike paths in Peru,” which yields over 20,000 Google results as of October 2024. Another is the proposal to merge the Federal Ministry for Economic Cooperation and Development (BMZ) with the Foreign Office. Although the first BMZ minister, Walter Scheel (a member of the liberal party (FDP) who later served as President of Federal Republic of Germany from 1974 to 1979), was well-versed in development policy, the FDP has advocated for the abolition of the ministry for years. Prominent proponents of a merger include Christoph Heusgen and Wolfgang Ischinger, both key figures in German and international foreign policy due to their leadership roles in the Munich Security Conference.
The more critical question, often overlooked, is: What should Germany aim to achieve with its development policy today? There’s no doubt that the world in 2024 is vastly different from when the BMZ was founded. Many countries that were once considered developing have since become donors themselves—South Korea, for instance, has rapidly ascended to this status. Over the next decade, several countries currently classified as developing by the OECD will “graduate,” meaning they will no longer qualify for Official Development Assistance (ODA), largely due to the economic progress achieved over recent decades.
Germany and Europe’s increasing interest in cooperating with partners in the Global South on a range of issues is rather new. This may be driven by geopolitical concerns (such as competition with China and countering Russian influence, and potentially a much less constructive international role from a second term of Donald Trump), geo-economic priorities (such as securing resource access), or the shared urgency of climate action, which cannot succeed without the participation of countries like India, Indonesia, and South Africa. Ignoring that contemporary development policy addresses these issues much more intensely than commonly assumed in German discourse is more than a minor oversight.
In short, development policy increasingly centres on shared interests with partner countries. It incorporates foreign policy, trade, security, and climate considerations, without simply being a vehicle for narrow national interests. This broader perspective gives development policy a unique operational scope. It has thus become central for engaging with partners, especially in the Global South.
Elsewhere, I have argued that “open strategic autonomy” (a term derived from EU discussions) might be an appropriate description here: Development policy should play an independent yet complementary role, supporting partners in the Global South while also advancing global public goods. Open strategic autonomy could bridge different policy perspectives and actors, while maintaining a degree of independence essential for effective and credible action.
This brings us to the question of ministerial structure, especially relevant in Germany, where federal governments have always been composed of at least two coalition parties, fostering internal competition, especially among externally oriented ministries. Additionally, Germany’s constitutional guarantee of ministerial autonomy grants ministers significant independence and responsibility. Although these characteristics are not unique to development policy, they significantly shape it.
The UK, where the Department for International Development (DfID) was merged into the Foreign, Commonwealth and Development Office (FCDO) under Prime Minister Boris Johnson in 2020 is often taken as an example. However, this does not provide persuasive evidence in favour of a merger, considering multiple factors (including substantial cuts to the development budget). Many observers argue that, even without a merger, the UK could have achieved most synergies without incurring the costs associated with integration. More importantly, the UK has lost not only its previously outstanding reputation in development policy but also considerable international standing and influence, as shown in a recent study. In essence, British foreign policy ultimately lost rather than gained leverage through this move.
The BMZ was initially intended as a “coordinating ministry,” gradually taking on additional responsibilities. Over time, coordinating German development policy has become more complex. For instance, only about one-third of Germany’s reported development cooperation funding comes from the BMZ. A total of 17 budgetary lines (representing numerous ministries) in the federal budget include development funds, which is often suboptimal when uncoordinated. The BMZ’s share of German ODA stands at nearly 41%, while the Foreign Office’s share is about 15%, highlighting the fragmented nature of the German system. It also shows that a significant portion of funds do not come from the federal budget at all (e.g., promotional loans from the German Development Bank (KfW) or costs for University spots for students from developing countries claimed by federal states).
The 2021 coalition agreement between the SPD (social democratic party), Greens, and FDP aimed for better coordination: “We will coordinate ODA funds at the federal level across relevant departments more closely to make more effective use of them.” To this end, an exchange at the level of state secretaries was initiated by the BMZ in 2023. So far, it appears that this body has not yet effectively coordinated the ministries involved. Developing fresh political ideas for this coordination challenge would be a worthwhile endeavor. The next few months will be a critical time to shape a new approach.
Stephan Klingebiel heads the research program “Inter- and Transnational Cooperation” at the German Institute of Development and Sustainability (IDOS). He previously led the UNDP Global Policy Centre in Seoul (2019–2021) and the KfW Development Bank’s office in Kigali, Rwanda (2007–2011). He is also a guest professor at the University of Turin (Italy), a senior lecturer at the University of Bonn, and an Honorary Distinguished Fellow at Jindal University (India).
This post is part of the European Development Policy Outlook Series and it first appeared on EADi's blog.
Note: this post gives the views of the author, not the position of the EADI Debating Development Blog or the European Association of Development Research and Training Institutes.
