In 2025, the world’s wealthy countries cut between 9 and 18% of their official development assistance (ODA), following an average of 9% cuts in 2024. These trends are led by the United States, which suddenly dismantled its international development agency, USAID, and exited or slashed funding for numerous international organisations, leaving a 60 billion USD funding gap. Rather than stepping up their contributions, many other countries followed suit. Meanwhile, the need for development cooperation has not lessened: over 800 million people still live in extreme poverty, around 120 million are forcibly displaced, and 250 million children are out of school, undermining their ability to build better lives in adulthood. The world is at a geopolitical inflexion point and the concept of ODA, introduced in 1969, seems to very rapidly evolving since 2025.
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An Alternative Approach
Even before recent cuts, ODA spending as a form of capital redistribution from “rich to poor” had received plenty of criticism. Many experts believe that the concept of aid is outdated, often ineffective, and reproduces traditional and neocolonial hierarchies by creating dependencies rather than enabling countries to flourish independently. Alternative approaches have been proposed and implemented for decades, and with funding cuts illuminating the need for innovation, some are now gaining traction. Among the longest-standing, but often under-utilised, alternative development models are triangular cooperation, South-South cooperation, and grassroots innovation. As Nadine Piefer-Söyler, Team Leader at the OECD’s Development Co-operation Directorate and specialist in triangular cooperation (TrC), frames it: “The times of aid donors and recipients are over. Countries are looking for partnerships, not aid. That’s also very valuable for developed countries because they can learn from their partners’ approaches and from how they engage in development cooperation. Many have well-established cooperation structures that are quite innovative and new.”
TrC has existed for over 40 years (and probably even longer), but has remained relatively niche. It requires three states working together in a specific but fluid constellation, each with a role as facilitating, pivotal, or beneficiary partner. The idea is to combine financial resources of developed countries with the hands-on experience of developing countries, so typical arrangements include a high-income facilitating partner, a pivotal middle-income country sharing local expertise and a low- or middle-income country receiving most of the material benefits. However, the roles can evolve and change over time, and many configurations have been successful, including low-income countries providing their expertise to other low- or middle-income countries. For example, Piefer-Söyler highlighted the valuable knowledge emerging even from least-developed countries: “They often have many innovations to share that can be very useful to other countries, too. For example, Charis UAS, a Rwandan drone company, builds its own drones and uses them to detect larvae of malaria mosquitoes and spray these areas to kill them before they hatch, leading to a 90% reduction in malaria locally. Now, that’s being shared with other countries through a triangular cooperation with Burkina Faso and Germany. In another project, Burkina Faso shared its experiences with Colombia. Sharing and learning can go in any direction, not just emerging or advanced countries sharing and poorer countries receiving.”
Different Modality, Different Principles
Unlike traditional North-to-South aid, TrC is expected to be non-hierarchical, requiring everyone to contribute. While the facilitator may provide the largest share of the funding, significant portions also come from the other partners, and every country sends its own experts and actively participates in project planning and implementation. This can enable significant cost savings, as local staff are usually less expensive but highly qualified and bring on-the-ground experience rather than top-down generic solutions. Dr Ulrich Müller, Senior Advisor at GIZ and honorary professor at the Technical University of Darmstadt, mentioned “a regional fund with Latin America which has existed for 15 years and where, on average, Germany contributes 40% of the overall costs, meaning that 60% comes from the other partners.” This not only reduces the burden for facilitating countries, but also automatically creates a fairer dynamic, building partnerships rather than donor-recipient relations.
Almost 70% of all TrC projects have budgets below 1 million USD. However, in many smaller projects, only the facilitating partners’ financial contributions are quantified, leading to an underestimation of their magnitude and impact. Nadine Piefer-Söyler told us that “most TrC projects are bigger than you think, because it’s not just the developed country that contributes. If you really counted the inputs of all three partners, not just money, but the experience they share that the others can learn and benefit from, then they wouldn’t be that small anymore. But of course, how do you measure a partnership? How do you measure knowledge or learning? That’s the challenge, these qualitative outcomes that are difficult to quantify but play a major role.”
Although TrC is still undoubtedly smaller than bilateral or multilateral cooperation, such out-of-the-box approaches are gaining new momentum given the pressures on ODA. Sometimes, the smaller scale and less institutionalised format can even be an advantage, as Neni Marlina, Principal Advisor SSTC Women Economic Empowerment Indonesia, Afghanistan, Germany for GIZ in Indonesia, explained: “The emphasis on solidarity brings opportunities for every stakeholder to become a key actor. We are no longer talking only about partnerships between governments, because even one person can create change in one sector by starting a small cooperation with partners from other countries that may later spread. We don’t need a big charter agreed by 10 heads of state. If we have dialogue, shared knowledge and solidarity, then the move is there. The change can happen. That’s our contribution to answering the global gaps.”
Potentials and Pitfalls
TrC is intended to complement rather than displace bilateral or multilateral cooperation, and the best modality differs by context. Negotiating among three equal partners increases transaction costs and requires more upfront investment into relationship-building, so to quickly address an urgent crisis, other paths are more suitable. However, many development issues require deeper, longer-term cooperation, and there, initial investments quickly pay off through more innovative, dynamic and locally tailored solutions which often save costs. While TrC is not restricted to specific sectors, around half of all projects relate to governance and civil society, agriculture and food security or health, as these areas often have rather small and strongly knowledge-driven initiatives. According to Dr Ulrich Müller: “TrC is great for problems where there is no straightforward, one-size-fits-all solution. If the task is simply to build 500 wells somewhere, then what is needed is money and equipment to get it done; involving a third partner unnecessarily complicates things. But if the question is how many wells to build and where, how to minimise environmental harms and how to sustainably and efficiently approach water as a scarce resource, then nobody has all the answers. Then, it’s about hearing local knowledge and experiences from similar situations and finding context-specific, long-term solutions together, as partners.”
Besides transaction costs, common criticisms of TrC regard short average project durations, with around three-quarters planned for less than four years. Especially given the costs involved in negotiating the partnership, this can seem like wasted potential. While the criticism is often valid, informal cooperation frequently continues beyond the project lifespan once a relationship has been built, and new projects can more easily build on past experiences. Bernadette Vega Sánchez, independent consultant and former staff at the Mexican Agency for International Development Cooperation (AMEXCID), told us that, “yes, it can be costly to partner with another actor to co-create something together. But it’s not just a cost. It’s also an investment, something that facilitates later progress.” Thus, the emphasis on disproportionately high setup costs may be exaggerated and risks comparing apples and oranges, as projects are typically in areas that inherently require more problem-solving and discussion rather than quick fixes.
Numerous case studies already demonstrate the effectiveness of TrC across many areas, but quantitative, long-term data remain scarce because small-scale projects often lack formal evaluations. The Total Official Support for Sustainable Development (TOSSD) database improved this by explicitly including triangular and South-South flows, but comparability between projects and quantifying non-financial inputs and outcomes remain challenging. While not formally evaluating every small project is understandable, these data gaps nonetheless seriously constrain the potential to scale TrC, as there is little comprehensive understanding of its effectiveness.
The Way Forward
Despite the added value of learning, knowledge exchange and informal cooperation beyond a project itself, convincing policymakers is an uphill battle without numbers to back it up. Whether that battle becomes easier now that the development world frantically searches for new solutions remains to be seen, but some experts believe the untapped potential is significant. According to Shenhong Yao, Director of the Division of Strategic Planning and South-South Cooperation at UNIDO, “TrC matters. Combining Southern contextual expertise with Northern financing or multilateral support achieves scale that neither modality could deliver alone.” Major institutions have recognised this, as shown, for example, by the UN’s call for enhancing triangular and South-South cooperation under SDG 17, “Partnership for the Goals”. With development cooperation at a critical juncture, this is the moment to embrace models that emphasise mutual benefits, require smaller financial investments by donor countries and build capacities that enable developing countries to stand on their own feet. TrC has gained significant momentum in recent years, and we can expect this to continue, but to really achieve scale, further work on its institutionalisation and professionalisation remains to be done.
