Target U.S. Foreign Aid More Selectively Amidst Austerity

• by Jim Lobe* (washington)
• Tuesday, May 08, 2012
• Inter Press Service

The report, a joint production of the Center for Global Development (CGD) and the Center for American Progress (CAP), calls for re- allocating bilateral economic aid to increase support for 32 high- priority and generally well-governed countries, while curtailing assistance to 51 others.

It urges a similar weeding out process among the 134 current recipients of U.S. security assistance, of which only 45 should be considered high-priority and thus eligible for increased support.

'The United States must make hard choices about where to invest its resources,' according to CGD's Connie Veillette, who co-authored the report with John Norris at CAP, a think tank from which the Obama administration recruited a significant number of its top foreign policy and aid officials.

'Foreign assistance works best in countries that embrace policy reforms and are committed to working with the United States as partners,' she added.

The nearly 300-page report, 'Engagement Amid Austerity,' also calls for Washington to focus its aid efforts on three areas in which the U.S. has a 'comparative advantage': health, food security, and the delivery of humanitarian assistance, particularly given the Pentagon's quick-reaction capabilities.

The report urges upper-middle-income recipients of Washington's nearly eight-billion-dollar-a-year President's Emergency Plan for AIDS Relief (PEPFAR) programme, including several southern African and Caribbean countries, to assume more responsibility for its cost and operations.

And it calls for a major overhaul of Washington's food aid programme to allow for more local and regional food purchases instead of insisting that almost all food aid be exported from the U.S. itself aboard U.S. ships.

The report also recommends the establishment of a bipartisan International Affairs Realignment Commission that would present a comprehensive package of reforms to be accepted or rejected in toto by the new administration and Congress. Such a mechanism was used successfully several years ago to decide on the politically hypersensitive issue of which military bases to close.

While the report, the product of consultations of a 15-member bipartisan working group over the past six months, does not recommend any reduction in the U.S. international affairs and aid budgets, it assumes that political and fiscal realities will force cuts, regardless of who wins the November presidential race.

'It is far easier to demonise foreign aid than to explain how relatively modest programmes to improve living standards in the developing world have consistently proven to be in the national interest over the long term,' according to Veillette.

The current Republican-backed budget plan in the House of Representatives, authored by Rep. Paul Ryan and endorsed by Romney, calls for cutting the foreign affairs budget by more than 30 billion dollars from 2012 levels over the next four years — or by some 10 percent a year — in contrast to the steady increases it mandates for the Pentagon.

In determining how to more effectively allocate U.S. diplomacy and aid in times of austerity, the task force considered multiple variables for each country recipient, including GDP per capita, net development assistance per capita, military expenditures, and country scores on half a dozen multinational indices designed to measure different aspects of governance, such as Transparency International's Corruption Perception Index, and the Human Development Index.

In addition, it considered more subjective factors, such as short- and long-term strategic interests, political support, and the traditional strength of the bilateral relationship. It also considered the degree to the role of multilateral assistance programmes to which the U.S. contributes.

All recipient countries were then divided into three categories for both economic and security assistance.

The first two include those considered 'priority investment countries', for which continued or increased aid was warranted; and those considered to have 'limited expectations', for which aid would continue based largely on short-term imperatives, such as geo- political concerns.

The last category is those to which aid should be curtailed for any of three reasons - because they could be 'graduated' from assistance within one to five years based on declining need and growing capacity; or because aid programmes there were too small or expensive to operate effectively; or because their performance, especially in the area of governance, was too poor to justify continued aid except for humanitarian reasons or to support local civil society.

Of the 103 countries currently receiving economic assistance, the report found 32 qualified as 'priority investment countries'; among them, Benin, Cote d'Ivoire, Liberia, Mozambique, Senegal, South Sudan, Burma, Indonesia, the Philippines, Tunisia, the Palestinian Territories, Bangladesh, Nepal, El Salvador, and Peru.

It also cited Mali but noted that the recent military coup d'etat probably disqualified it.

Limited expectation countries included, among others, the Democratic Republic of Congo (DRC), Ethiopia, Rwanda, Uganda, Zimbabwe, Egypt, Iraq, Yemen, Kazakhstan, Bolivia, Ecuador, Haiti, Cuba, and Mexico.

Among countries where aid could be curtailed, the report cited Botswana, Namibia, South Africa, and Nigeria in Africa; Thailand, India, and Sri Lanka in Asia; Brazil, Colombia and the islands states of the Eastern Caribbean in the Americas as those which could be graduated from U.S. aid programmes.

Laos, Timor-Leste, Morocco, Guyana, and Jamaica were among those which were considered either too small or too expensive to operate, but the report noted that aid could continue in these countries with a minimal U.S. presence.

Among the 'poor performers' were Angola, Cameroon, Sudan, Cambodia, Vietnam, Azerbaijan, Nicaragua, and Venezuela. Several Central Asian states, Afghanistan, and Pakistan also fell into this category, but the report stressed that the U.S. could continue providing economic aid - albeit reduced from current levels - to the latter two through a proposed 'strategic fund' that would be administered separately by the State Department.

Among the 45 'priority investments' for U.S. security assistance, the report cited most of the same countries deemed priorities for economic aid, including Nigeria, South Africa, Thailand, Timor-Leste, Russia, Turkey, Israel, and Colombia.

'Limited expectation' countries included Ethiopia, Mozambique, Vietnam, Alteria, Egypt, Iraq, Jordan, and Yemen, among others, while countries which can 'graduate' from U.S. security aid include India, Argentina, Brazil, Chile, Uruguay, Malaysia, Singapore, among others.

'Poor-performing' countries where aid should be curtailed for reasons of poor governance of human rights abuses include Angola, Bahrain, Cambodia, Laos, Afghanistan, Pakistan, Uzbekistan, Sri Lanka, and Nicaragua, although the report stressed that security-related assistance may continue through the proposed 'strategic fund'.

The report stresses the importance of increasing cooperation with other donors, particularly multilateral institutions, in enhancing aid effectiveness and reducing costs and also suggests that Washington develop trilateral cooperations with emerging aid donors, notably India, South Africa, and Brazil, all of whom receive U.S. aid but have also launched their own aid programmes.

*Jim Lobe's blog on U.S. foreign policy can be read at http://www.lobelog.com.

© Inter Press Service (2012) — All Rights ReservedOriginal source: Inter Press Service

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