Five Ways Aid Agencies Can Increase Their Impact in Middle-Income Countries

Middle-income countries often have significant capabilities themselves to fight poverty and inequality. Aid organizations must therefore look for strengths that complement and match national governments’ goals, priorities, issues, and capability gaps. Critical strengths might include a strong brand associated with neutrality and competence; expertise in program design or management; global experience on specific topics; technical expertise in areas such as the supply chain, distribution, or child protection; access to global stakeholders; and proven planning and implementation skills.

No longer in need of traditional aid, middle-income governments want value-adding services in areas in which they lack adequate expertise or experience. To succeed in this new arena, agencies must be able to add value by playing one or more key roles: advisor, enabler, coordinator, or advocate. Those agencies that can provide advice on how to design an effective social program, for instance, or that have the skills to enable national authorities to implement effective programs, will be well positioned to succeed.

New activities and roles require new skills. In the past, agencies needed large numbers of staff with experience in operations and implementation. In middle-income countries, however, agencies may need fewer people with different skills who can act as advisors and enablers. Long-term recruitment strategies must anticipate future demand and start matching existing skills to evolving needs.

No longer dependent on external grants, middle-income governments are now largely self-funding and purchase the agency services that they perceive a need for. For agencies, changes in the funding model may make it hard to build up new skills and activities while ensuring the continuity of current programs. To have a sustainable impact, agencies must develop new funding strategies, shifting away from traditional donors to new sources, such as host governments, foundations, the private sector, and impact investment players.

With their local presence, national governments and national NGOs are in the best positions to implement social programs cost-effectively. They look to aid agencies for expertise and experience—and knowledge is the biggest source of competitive advantage for agencies today. Consider systematically documenting your agency’s global experience in the field and developing a platform to organize, capture, share, and apply important lessons within and across countries.