7. USAID TO PUSH DEMOCRATISATION AGENDA

The agency, for instance, had struggled this year to move money from
other accounts to support the democratic transformations in the
Ukraine and Lebanon, two high priorities for the State department.


By Edward Alden in Washington, Financial Times
London, United Kingdom, December 23 2005

The US Agency for International Development will unveil early next year a
comprehensive strategy for improving democracy and governance in

developing countries.

In an interview with the Financial Times, Andrew Natsios, the USAID
administrator who steps down at the beginning of next year, said the
democracy strategy was a key milestone in the re-orientation of US aid
programmes to focus on issues of effective governance alongside traditional
development projects.

Mr Natsios also confirmed that the administration was drawing up proposals
for a broader overhaul of the organisation of US foreign aid, but would not
discuss details, saying some of the final decisions had yet to be made.

He said there were structural issues that needed to be addressed, in
particular the fragmentation of responsibility for development programmes
across different departments and agencies in the US government. “There are
problems that need to be addressed for the protection of the president’s
legacy on foreign aid.”

With the Bush administration’s commitment to spreading democracy and
repairing failed states that might harbour terrorists, foreign aid has
become an increasingly critical part of the overall US national security
strategy. Since 2000, the US aid budget has doubled from $10bn to more
than $20bn this year.

But Mr Natsios said aid programmes could still be making a much greater
contribution to US security. A senior US general recently told him that in
Baghdad’s Sadr City – a poor, Shia-dominated neighbourhood – “in the areas
you have programmes, I have almost no casualties. In the areas you have no
programmes, I have very high casualty rates”.

He said the general told him “there’s a direct connection between your
programming and how people feel about the US presence in Iraq”.

Mr Natsios said domestic political pressures had made it difficult to
re-orient US aid to support democracy-building. He said earmarking – in
which Congress allocates US aid funds to specific countries and sectors
– was “a very serious problem”.

According to a just-completed internal analysis of the $4.5bn based budget
for USAID, only $200m is subject to discretionary control by the agency, he
said.

“The difficulty is how do you do strategic budgeting when you don’t have the
discretion to shift money around from one sector to another and from one
region to another?”

The agency, for instance, had struggled this year to move money from other
accounts to support the democratic transformations in the Ukraine and
Lebanon, two high priorities for the State department.

“American foreign aid is driven to some degree by domestic constituencies
and domestic interests in a way which is not necessarily responsive to the
problems of the developing world, which is the purpose of the programme.
It responds to our culture wars and our issues here domestically.”

He said “the sectors that are most important usually receive the least
funding” because there were no organised interests championing those
programmes. Agricultural development had been particularly difficult to
fund, he said, in part due to opposition from environmental groups. -30-

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