Our incredibly wealthy world can easily afford to end poverty

International humanitarian solidarity – life-preserving assistance from one country to another following catastrophes – is under great stress. On one hand are the growing needs arising from more and longer wars fought with lessening restraint, and from intensifying climate disasters. On the other hand, the shock-absorption capabilities of communities are squeezed as economic development and poverty reduction stall.

The consequences are visible in states that are grappling with mounting domestic problems while turning inwards to protect core national interests. Rules-based international co-operation for the common good is the obvious casualty. The shrinking empathy for others is reflected in the 23 per cent year-on-year contraction in official development assistance from OECD countries to $174.3 billion (Dh640.1 billion) last year. Within that, humanitarian aid fell the most – by 36 per cent – to $15 billion. Forward projections suggest further reductions.

Inevitably, resource-starved aid agencies cut services. Concurrently, as economic warfare including trade barriers are normalised, weaker countries lose revenue and shrink social welfare budgets. That predicates more unmitigated deprivation.

Must it be so? After all, even amid a callous new geopolitical order, collectively, we are relatively wealthy. Nominal global gross domestic product exceeds $126 trillion, having trebled since the millennium; this is due to increase 30 per cent further by 2030. Despite current disruptions, at $15,000 per capita, the world has never been so rich.

Meanwhile, the number of people affected by crises increases. There is no agreed number because we do not have universally agreed humanitarian thresholds, as these are politicised concepts. However, a strong estimate is that about 500 million people every year are caught up in 400 significant disasters and 130 armed conflicts. This is midway between the UN’s estimate of 239 million people that require emergency aid and the World Bank’s update that 826 million live below the $3-a-day poverty line.

How much does humanitarian succour cost, as assessed by scientifically informed requirements for food and nutrition, water and sanitation, health care, shelter and clothing – the essentials necessary for dignified living? There are no authoritative estimates but they can be reasonably computed at about $60 per capita in lower-income countries and $100 in middle-income settings. Assuming a median value of $80 postulates an annual global requirement of $40 billion for aiding 500 million people.

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World leaders gather in Doha for summit for social development

To that must be added the costs of humanitarian delivery. There are no agreed criteria for allowed overheads such as management, monitoring, audit and evaluation, reporting and compliance, safety and security. Donors set their own rules and recipients find creative ways to bypass them. Data on true direct and indirect costs exist but are commercially sensitive in the competitive humanitarian business. In practice, overheads are negotiable and range from 5 to 30 per cent with the spread not explicable by delivery complexities for hard-to-reach places. Perhaps 15 per cent is a reasonable benchmark. Adding that to the normative aid requirement gives a global humanitarian assistance bill of $46 billion.

However, a holistic approach to the world’s humanitarian needs also requires beneficiary equity. Currently that is not the case – per capita humanitarian receipts last year ranged from less than $100 in Sudan and DR Congo to nearly $1,200 in Palestine, $500 in Lebanon, $400 in Bangladesh and $300 in Myanmar. The spread is not explained by objective differences in needs and reflects donor preferences that favour some places more than others.

When limited humanitarian aid intended for impartial provision is distributed unfairly, it undermines humanitarian principles, laws and co-operation. It also fosters grievance and mistrust in international aid. Humanitarian financing reforms could tackle this through consistent criteria-based entitlements as happens in domestic social security systems – as opposed to inconsistent charitable allocations.

Rebuilding trust also requires regaining donor confidence through improved efficiency. The current $46 billion humanitarian requirement is the same as the aid received in 2022 before reductions began, but with an important difference. Four years ago, 300 million people were targeted while today 500 million require help. That necessitates benefitting 60 per cent more people with the same resources.

Is that feasible? In significant measure, yes, through accelerating shifts towards smart humanitarianism. The staffing of international agencies consumes a quarter to half of organisational budgets. Making them a third leaner through decentralisation and streamlining cumbersome business models with huge internal processing costs liberates billions of dollars.

Part of that is by cutting out intermediary administration costs through localising to in-country humanitarian actors who currently receive directly less than 10 per cent of foreign aid transfers. That should rise towards 90 per cent to match the proportion of services they actually deliver.

The content of humanitarian services could shift faster. For example, from logistics-costly commodity to digital cash assistance. This is easily pegged to the cost of survival packages in the marketplaces of receiving communities, thereby bringing wider benefits.

This is before humanitarians scale-up the adoption of AI. That brings efficiencies not just in everyday office tasks but also by speeding-up and automating workflows such as post-disaster needs assessments, optimising supply chains, and enhancing stakeholder engagement and satisfaction. Most important, predictive AI can expand capabilities for proactive risk management regarding crop failure, flooding, starvation and disease. It can personalise and augment humanitarian protection, search and rescue operations, and family reunifications. A potential 25 per cent saving in humanitarian organisational costs is achievable on the exemplar of other industries.

How could $46 billion – minus, perhaps, $10 billion realisable through efficiency savings – be funded? Some of the rest will come from domestic spending as 55 upper-middle- income countries become increasingly capable. Studies show that domestic safety net expenditure may be 13-fold greater than received foreign humanitarian transfers, implying both capacity and willingness in developing countries to look after their own needy groups.

My calculations are simply intended to illustrate the feasibility of a fair system to mobilise 0.4 per cent of global GDP to preserve the most desperate 6 per cent of humanity

However, 25 low-income and 50 lower-middle income countries will still need foreign humanitarian aid. Meanwhile, humanitarian financing that also accounts for future increased demands cannot be sustained on the unreliable benevolence of a few entities such as the US and EU that provided 26 per cent of all funds last year. Fair burden sharing among the 118 richest countries, according to a formula based on their economic strengths, can easily cater for all current and foreseeable humanitarian needs.

Can such a transformation of humanitarian financing happen? Yes, if the present reset of the international system pulls out of the downward spiral of doing less-with-less. Its hyper-prioritisation strategy is like a triage that judges who deserves to live or not. UN and other humanitarian agencies are not legitimated to do that, and this deals a terminal blow to universalist humanitarianism.

My rough-and-ready calculations have limitations but are simply intended to illustrate the feasibility of a fair system to mobilise 0.4 per cent of global GDP to preserve the most desperate 6 per cent of humanity. Moral imperatives aside, that is not just affordable but an extraordinarily good investment to hedge the instability that inevitably follows unmitigated largescale human suffering.

At a time when solutions to prevalent crises elude us, this is, arguably, an enabler of the political accommodations necessary to foster harmony whenever that happens.