Programmes for developing and transformation countries pursue two central policy goals: to provide initial and continuing education and training for young university teachers and key experts and executives (staff development) and to support the construction of appropriate structures (institution building). Various study programmes are available in Germany and in the home country or home region ("sur-place" and "third country" scholarships). The DAAD receives funding for new programmes from the Federal Ministry for Economic Cooperation (BMZ), although in some cases Federal Foreign Office (scholarship) programmes also take effect here.

The programme of "Postgraduate degree courses with relevance to developing countries" supports a total of 35 continuing training programmes offered by Germany’s universities. The funding is made up of performance-oriented scholarship quotas plus funds for the material support and academic guidance of scholarship holders. Funded programme participants come from developing countries and countries in transition. They are experts and executives in the field of business, trade and commerce and administration. The continuing appeal of this programme is not only demonstrated by the growing number of applicants, but also by the pleasing fact that the number of self-financing participants from Germany, European and non-European countries is increasing. This circumstance also benefits from the fact that the majority of these postgraduate programmes are instructed in English and are completed with internationally-recognised degrees.

The DAAD also has a broad funding instrument called "Subject-specific university partnerships with developing countries" under which 83 partnerships with high-quality projects in a wide range of subject areas are currently being supported. The programme not only funds the partner universities in the developing countries; it endeavours at the same time to enhance the German universities’ understanding for and expertise in development cooperation.

The "Country-related scholarships for young academics and researchers from advanced developing countries" programme, again financed by the BMZ, is intended for young engineers from Argentina, Chile and Mexico, and from India, Indonesia, Thailand, the Philippines, Vietnam and Sudan. Under this programme, foreign funding organisations or the participating universities themselves provide scholarships for study stays in Germany lasting up to 13 months, while the DAAD generally covers the cost of language courses and guidance, counselling and supervision.

A placement programme for German academics and researchers involving a shared-funding model was also agreed with South American sponsors in 1997. So far, 42 highly-qualified, young German university lecturers have gone on teaching assignments to Brazil, Chile and Mexico. The DAAD uses BMZ funds to pay the travel expenses and a flat-rate insurance allowance; the host country pays all other costs.

The Alumni Programme to maintain follow-up contacts with students from developing countries who graduated from German universities and have returned home to the partner countries, where, today, they often hold leading positions, aims to enable these graduates to play a part in development cooperation with Germany. November 2003 saw an international Alumni Symposium, which was also attended by Federal Minister of Economic Cooperation Heidemarie Wieczorek- Zeul, draw a positive review of the alumni activities carried out to date.

The "Equipment donations for universities in developing countries" programme provides academic staff working at these institutions with the material resources required for cooperation with German colleagues.

The DAAD additionally had special funds at its disposal in 2003 for deepening the dialogue with universities in Islamic countries. This made it possible to carry out numerous additional measures in existing cooperation projects and meant that academics and researchers could be invited to attend special events.

The DAAD has been supporting university management bodies in developing countries since 2001. Under the working title of DIES (South-North Dialogue on Innovative Higher Education Strategies), the DAAD and HRK organise experience exchange on questions of innovative higher education policies and efficient management. This involves funding for conferences, workshops and seminars with relevant organisations from developing countries, the postgraduate programmes UNISTAFF and Unicambio XXI, plus the arrangement of information trips for decision-makers. June 2003 saw the Afghan higher education minister and eight Afghan university rectors complete an information visit to Germany; in October, a delegation of South African vice-chancellors came to gather information on the experience Germany’s higher education institutions had gained in the field of comprehensive universities and university mergers. October also saw a major DIES conference held in Nairobi on the topic of "Quality Assurance through Curriculum Design – A Case Study of Higher Education Management in East Africa", which was attended by 140 East African university heads.