Overview of USAID

Much of modern day international development assistance evolved out of Secretary of State George C. Marshall’s plan to commit massive U.S. resources to rebuild Europe’s infrastructure and economy, destroyed during World War II. In 1947, the European Recovery Act was passed into law and became known as the Marshall Plan. The goal of this Plan was to stabilize Europe by providing financial and technical assistance.

Building on the success of the Marshall Plan, President Truman proposed an international development assistance program in his 1949 inaugural address. Between the 1950 Act of International Development and 1961, various development assistance organizations were established: the Mutual Security Agency, the Foreign Operations Administration, and the International Cooperation Administration.  Programs such as Food for Peace (food aid) and the development Loan Fund were also introduced.

In 1961, Congress passed the Foreign Assistance Act (FAA), which mandated the creation of an agency to promote long-term assistance for economic and social development.  On November 3, 1961, President John F. Kennedy established the United States Agency for International Development (USAID) funded by the tax contributions of U.S. citizens. Since 1961, USAID has been the principal U.S. Government agency providing assistance to countries recovering from disaster, striving to escape poverty, and engaging in democratic reforms.

Historically, about one-half of one percent of the federal budget is allocated to economic and humanitarian assistance. In 2004, USAID directly administered approximately $8.8 billion and co-managed another $4.5 billion with the Department of State. (See USAID Primer: What We Do and How We Do It)

Today, as stated in President Bush’s National Security Strategy, USAID’s work in development joins diplomacy and defense as one of three key pillars of the nation’s foreign policy apparatus. USAID promotes peace and stability by fostering economic growth, protecting human health, providing emergency humanitarian assistance, and enhancing democracy in developing countries. These efforts to improve the lives of millions of people worldwide represent U.S. values and advance U.S. interests for peace and prosperity. (See USAID Primer: What We Do and How We Do It and FY 2004-2009 Department of State and USAID Strategic Plan (HTML) and http://www.state.gov/documents/organization/24299.pdf

USAID provides assistance in sub-Saharan Africa, Asia and the Near East, Latin America and the Caribbean, and Europe and Eurasia. With headquarters in Washington, D.C., USAID’s strength is in its field offices in many regions of the world. The agency works in 100 developing countries and in close partnership with private voluntary organizations, indigenous groups, universities, American businesses, international organizations, other governments, trade and professional associations, faith-based organizations, and other U.S. government agencies. USAID has working relationships, through contracts and grant agreements, with over 3,500 companies and over 300 U.S.-based private voluntary organizations.

(Ref: U.S. Agency for International Development Primer, March 2005)