This is an archived USAID document retained on this web site as a matter of public record.

Remarks by Don Pressley,
Assistant Administrator, Bureau for Europe & Eurasia

to the Senior Seminar
September 29, 2000

---

INTRODUCTION

• The world is a different place since 1989. The end of the Cold War has resulted in a policy of broad engagement in new and different ways.
• The breakup of the Soviet bloc has added tens of countries where the U.S. now has such active engagement.
• As you know, one aftermath of the collapse of the Berlin Wall has been the rethinking of how the foreign affairs agencies should be organized. After intensive debate, USIA and ACDA were officially folded into the State Department. USAID was left as an independent agency, but now with direct reporting to the Secretary of State.
• The debate over the value of foreign assistance has been going on for much longer than 10 years and will likely intensify with a change in Administration, but this morning I'd like to explain what I see as the current rationale, program focus, and operation of USAID. I will, with apologies, emphasize the Bureau for Europe and Eurasia, as a more detailed example of how we work, and I will be pleased to take any questions that you may have.

Why Foreign Assistance

Fortunately, this very question arose when Secretary Albright testified before the Senate Foreign Relations Committee on Monday. I'll just quote what she said:

"I think our real problem is we've got to stop calling it "foreign aid." Those are two words that don't go together and the American people don't like. This is not assistance to other counties, this is the way that the United States maintains our prosperity. Our prosperity today is dependent on other countries also rising and having functional economic systems and functional governments. This is not "foreign assistance," it is assistance to America, and I think we need to see it that way and not see what we do as a giveaway program or supporting people that we are not interested in. We have managed to keep America at peace and prosperous, and it takes assistance to America to make that happen.

Assistance Strategy

Basically, as implied by the Secretary's remarks, we see economic assistance very much in the interests of the United States in two ways:

1. Preventing or limiting problems that can harm our national interests; and
2. Creating opportunities to advance our national interests in the emergence of a more peaceful, prosperous world.

If we look at the problems in the world that can touch us at home, we see that such problems include environmental degradation, endemic poverty, persistent ill health and malnutrition, unsustainable population growth, slow or absent economic growth, oppression, and anarchy.

The problems of development increasingly cause conflict, drive the collapse of civil society, impel economic migration, and threaten economic growth.

If we look at the opportunities side:

• Foreign aid also creates markets for American goods and thus jobs for American workers.
• Developing nations now represent the fastest growing markets for American goods. They are growing ten times as quickly as our traditional markets in Europe and Japan.
• Trade does not simply materialize. The ground must be prepared first.
• Our creation of markets requires support for policy reforms that open markets, educational programs that transfer skills, social programs that help the poor, especially women, become full participants, and democracy building that helps to create a middle class, a free market, and institutions that ensure their vitality.
• In essence, foreign assistance is an inexpensive investment in our own interest and well-being.

 USAID'S STRATEGY FOR SUSTAINABLE DEVELOPMENT

USAID's strategy is based on the following parameters:

Partnership with the nations and the people we assist.

A concentration of programs and resources in countries where help is most needed and where it can make the most difference.

Maximizing of limited financial resources.

Bringing all U.S. resources to bear--money, food, technical expertise, values, technology, and the involvement of ordinary Americans.

A focus on the effects of assistance within society,

not on inputs.

USAID has chosen to concentrate its efforts in five areas that are fundamental to sustainable development:

• Broad-based Economic Growth
• Environment
• Population and Health
• Democracy
• Providing Humanitarian Assistance and Aiding Post-Crisis Transitions.
  
  

Countries where USAID will work:

1) Sustainable Development Countries:

• In coordination with local authorities and other donors and development groups, USAID will develop an integrated package of assistance.
• Primary need: An effective, integrated development plan.

2) Transitional Countries:

• Nations that have recently experienced a national crisis, a significant political transition, or a natural disaster.
• Primary need: Timely provision of assistance to address crisis needs, reinforce institutions and national order, help nation return to path of development.

3) Limited Presence Countries:

• Nations where USAID will operate from a regional base, or through third parties, targeting non-governmental sectors, helping facilitate democratic transformations, addressing basic humanitarian needs, or influencing a problem with regional or global implications.
• Primary need: Effective operations from a regional base, close coordination with PVOs, NGOs, USAID may provide technical assistance. Other donors will assume lead.

USAID'S BUDGET

For the past several years, USAID has managed something on the order of $7.5 billion, which is typically roughly one-third of the budget for international affairs (the so-call 150 account) and is less than 1/2 of one percent of the total Federal budget. USAID has an active presence (USAID Mission) in 65 countries. 

EUROPE AND EURASIA

Let me take a minute to describe the program of assistance that USAID administers for the countries of the former Soviet bloc, which comes under my responsibility.

In 1989, Congress passed the Support for East European Democracies (SEED) Act; and, in 1992, passed the FREEDOM Support Act to provide for assistance to these countries.Some years ago, USAID translated the parameters of the SEED and FREEDOM Support laws into a strategic framework to guide programming for all 27 countries of the region. At that time, though, the guiding principles were still short-term interventions, to help countries we perceived as ready, willing, and able to make a fairly rapid transition.In the fall of 1998, in preparation for the ten-year anniversary of the beginning of our programs in the E&E region, we began a series of exercises to reexamine our assumptions: what lessons had we learned? Where could we improve? What worked - and what didn’t?

To find out, we talked to our counterparts, academic experts, think thanks and people like you - our colleagues in government. And one of the main conclusions we arrived at is that getting the countries of this region - countries like Kyrgyzstan, Romania and even Russia - to fully join the global economy will take a lot longer than we had originally thought.So, last December, we adopted a revised framework--one that takes into account the shifting realities of this volatile region.Our basic strategic framework focuses on three areas, the three pillars of any successful society:

• Economic restructuring, to help build strong markets;
• Democratic Transition, to help build strong civil societies; and
• Social Sector Formation, to help build strong, targeted social safety programs.

These three strategic areas- - economic, democratic, and social reform - -we divide these areas into twelve Strategic Objectives, or SOs, that we use to guide our programs.

Economic SOs include, for example, fiscal reform and enterprise development; democracy SOs include rule of law and citizen participation; social SOs include promoting access to quality health care and mitigating social impacts.We have 12 teams, so-called Program Objective Teams, which work with our Missions on achieving these strategic objectives; they also measure, about once a year, the progress - or lack thereof - of each strategic objective. We then use these measures, or POT assessments, to guide our country programs and evaluate progress (and, if applicable, readiness for graduation) by comparing the different countries in the region to each other, and to the EU.

So for instance, if we look at the assessment report for fiscal reform, we can say that while Estonia has nearly completed the fiscal policy reform necessary for development, Armenia still has a long way to go.Our goal in assessing progress twelve different ways - that is, by each Strategic Objective - is to gain another perspective on the transition process. Where are we the most effective? Where are we the least? This allows us to better concentrate and focus our efforts.

Using this strategic framework, USAID has 'graduated' 8 countries, where we no longer maintain bilateral programs, and has focused and re-shaped our programs in the remaining countries of Southeast Europe and Eurasia. In every country, though, we are looking to the time - as in Poland or the Czech Republic - when we will say that although we could do more, this country is performing well pretty much across the board. Our work here is done. Then we can continue the process of putting ourselves out of business, as we did in the eight countries where we no longer operate.

Now, let me talk about this overarching goal of sustainable partnerships. First, what does that term - sustainable partnerships - mean, exactly? Well we use it to mean a partnership between entities, international as well as regional, between nations, between communities, between institutions and between people. The premise behind creating these partnerships is that not only do we each have a lot to learn from each other, but that there needs to be a variety of mechanisms in place to continue USAID's work - in the economic, democratic, and social sectors - when bilateral assistance programs are no longer needed.

In order to be sustainable partners, the countries of Central and Eastern Europe and Eurasia need to develop the institutional framework upon which to build strong economies and the strong civil societies needed in today's shrinking, ultra-competitive world. USAID has a particularly important role to play in helping these countries build this framework, both inside and outside government.

Let me give you a couple of examples of the kinds of partnerships USAID can help create. In 13 countries in this region, USAID, working closely with the United States Energy Association, or USEA, has supported partnerships between American utilities and energy regulators and their E&E counterparts. Using everything from internships to executive visits to workshops, this program has helped change the way former communist managers do business. For example, Hungarian regulators now routinely hold public hearings on energy tariffs and customer complaints. Kazakh officials are learning the rules of running a competitive power market. And a Ukrainian utility is learning to tap new sources of investments. I should note, too, that when this partnership project first started USAID and USEA split the cost 50/50.

Last year, in Europe, we started a new, regional partnership activity that builds upon the original one. In this new program, USAID's share of the cost is only 20 percent, with the understanding that after three years, there will be no USAID support at all. We hope, though, that even after we're long gone, these partnerships will continue to flourish - and I have to say, it looks like they will.

Another example I like is the Health Partnership program, run through the American International Health Association. This program has supported 50 partnerships in 20 countries since 1992, involving 80 American hospitals and 36 educational institutions. One of my favorite stories, in fact, is about hospital staff in St. Louis learning how to better care for critically ill patients from health care workers in Latvia. The thing that makes this story so illustrative is that the St. Louis folks were actually sent across the Atlantic to teach the Latvians new skills. That they did, but they also ended up learning something new themselves--and the lives of many patients around St. Louis are better for it.

This Latvian program, too, is no longer funded by USAID, but the partners decided that they would keep it alive, and, without any more US Government funding, it's still going strong.

Creating sustainable partnerships will take time and effort, and must build upon a lot of progress through our traditional technical assistance activities. But we believe that this and the other goals I've articulated reflect the foreign policy objectives of the United States Government as well as the values and aspirations of our agency. As President Clinton has stated, "We seek a transatlantic partnership that is broad and open in scope, where the benefits and burdens are shared, where we seek a stable and peaceful future not only for ourselves, but for all the world."

CONCLUSION

I think that this vision of a world of partnerships is not a bad vision at all for us all to be following. We at USAID believe that we have a role to play in furthering this vision, s a part of the foreign affairs community, and that our role is of significant benefit to the United States and its national interests. As long as we are given the opportunity, we will try to faithfully carry out our part.Thank you. I look forward to your questions.

This is an archived USAID document retained on this web site as a matter of public record.

:  :  :  :  :  :  :  :  :  :  What's New : FOIA Requests : Privacy Policy : Email This Page : Plug-ins : FAQs : Help Desk : Contact Us : Site Map Last Updated on: July 12, 2001