The Netherlands is the rich nation which does the most to improve lives in developing countries, a Center for Global Development (CGD) report says.

The UK is 12th in the annual Commitment to Development Index of the world's 21 richest nations and Japan ranked last.

CGD President Nancy Birdsall welcomed a "steady" improvement in commitment to poverty reduction in recent years.

But, she added, help had fallen far short of promises made by world leaders in 2005 - the "Year of Development".

The CGD's measures a broad number of factors for the index, rather than merely the amount of aid countries provide.

It also examines several policy areas - such as trade investment migration and environment - while aid is measured not only in terms of quantity but as a share of its income and the quality of aid given.

'Room for improvement'

While the Netherlands led the pack on generous investment and aid as well as measures to curb greenhouse gases, the CGD added they could work harder.

By contrast Japan ranked in last place due to a combination of factors including its low aid and high barriers to imports and migrants from poorer nations.

Meanwhile, despite the US giving the largest amount of aid that donation was the smallest in relation to the size of its economy.

The CGD added that a lot of the money was also contingent on the purchase of US goods, and so was in fact a "backdoor subsidy for American interests".

America was also criticised for its handling of aid in Iraq with the CGD claiming that 90 cents in every dollar was lost to violence and corruption.

Trade barriers

However, the country fared well on the trade front, ranking second after New Zealand as barriers to exports from developing countries are not as high as those from the other nations in the Commitment to Development Index.

Elsewhere the UK ranked first in the investment component of the Index for its efforts to boost technology and increase jobs. It also achieved the highest score for its environmental record.

But the index penalised the country for selling arms to "undemocratic governments".

"The lives of a billion people could be improved in the next decade if rich countries reform their trade, migration and investment policies," David Roodman, CGD researcher and chief architect of the CDI.

"Politically, these changes are difficult. However, if rich countries are truly committed to development, they could easily bear the short-term costs of the reforms and the spread of prosperity would serve the interests of all countries."

© Copyright 2006 BBC News

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