Rethink, Reset, Rebound: How Countries Can Leverage Alternative Resources for Growth Amid Aid Reductions

This IFIT publication is authored by Betty Wilkinson and Mariam Alsoudi. The era of guaranteed international aid is rapidly fading. For many fragile and transition countries, this reality has exposed both the limitations of an aid-centric development model and the urgency of finding new, more resilient pathways to growth. This thought piece explores how countries can adjust to the new normal by mobilising underutilised resources and strengthening national ownership. Focusing on three key pillars - domestic taxation strategies, diaspora and entrepreneurial investment, and alternative financing models - the paper highlights practical ways to unlock capital, foster innovation, and build more inclusive development systems. Drawing on examples from Africa, Asia, Latin America and beyond, it shows how strategic reform and alternative partnership models can move countries away from transactional donor relationships toward more sustainable and locally anchored transitions.