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- 02/06/12: Remarks by Donald Steinberg, Deputy Administrator, US Agency for International Development - Beyond Victimhood: The Crucial Role of Marginalized Groups in Building Peace
- 02/02/12: Statement of Dr. Sarah E. Mendelson, Deputy Assistant Administrator for Democracy, Conflict, and Humanitarian Assistance, before the House Subcommittee on Africa, Global Health, and Human Rights - U.S. Policy toward Post-Election Democratic Republic of the Congo
- 01/20/12: Remarks by USAID Administrator Dr. Rajiv Shah at the Environment and Security Conference, Washington, DC
- 01/19/12: Remarks by USAID Administrator Dr. Rajiv Shah at the Brookings Institution, Washington, DC - U.S. Aid and Transparency for Global Development
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This is an archived USAID document retained on this web site as a matter of public record.
Testimony of Ambassador Wendy Chamberlin
Assistant Administrator, Bureau for Asia and the Near East
The Middle East Partnership Initiative (MEPI)
Before the Subcommittee on Asia and the Pacific
Committee on International Relations
U.S. House of Representatives
March 20, 2003
Thank you, Mr. Chairman. I am grateful for this opportunity to speak with members of the Subcommittee. All of us are concerned today by the unfolding events in Iraq and the possibility that once again U.S. forces will be called upon to take decisive measures to ensure the United States and international community do not fall victim to terrorism, violence, and the spread of weapons of mass destruction. As we know from recent events in Afghanistan and along the Indo-Pakistan border, these threats are very real to the people of South Asia. Terrorism, ethnic and religious conflict, and nuclear war present imminent dangers to the South Asian subcontinent. Assistant Secretary of State for South Asia Christina Rocca will address these political factors and our policy response.
I appreciate this opportunity to represent the Agency for International Development in this critical discussion, because of the important role our assistance programs play in addressing-and if we do it right, preventing-the many threats to U.S. interests posed by terror, violence, weapons, disease, crime, drugs, and hate. In the words of AID Administrator Andrew Natsios, "this Administration has taken development off the back burner and placed it squarely at the forefront of our foreign policy."
A number of the President's initiatives signal a radically new approach to foreign aid. The Millennium Challenge Account (MCA) articulates a fresh and practical policy framework for development. The MCA is built on the simple fact that our aid is most effective in situations where governments are democratic and accountable to their citizens. We will achieve more effective results in economies that are open and corruption-free, where governments invest in their people. The MCA offers significant aid for governments that meet high standards of performance. By defining the causal relationship between good governance and economic growth, the President has provided a formula for more effective assistance. Andrew Natsios amplified these theories in his recent report, Foreign Assistance in the National Interest.
Another welcomed initiative is the Middle East Partnership Initiative, or MEPI, which emphasizes democracy, trade and education in a region that is desperately in need of all those things. Mr. Chairman, although the countries in South Asia are not eligible for MEPI, I wish to assure you today that the Asia Near East Bureau is dedicated to applying the principles of the MEPI and the Millennium Challenge Account to our programs in South Asia. To be sure, not all of the governments in South Asia where we have programs would meet the MCA high standards of good governance and economic openness today. However, it is our goal to work with governments and the people themselves to create conditions in which all South Asian countries can some day meet those standards.
There are daunting obstacles and much work to be done. Neither we nor the countries themselves can be allowed to fail. As we currently observe in Iraq and as the National Security Strategy states, "America is now threatened less by conquering states than we are by failing ones." For this compelling reason, we must use all influences available to us to strengthen just governance, encourage investment in people, and assure economic freedom.
Indeed, foreign aid is one among many levers we have to influence our foreign policy interests. Arguably it is the most cost effective. The good news is that we already have a number of successful projects. In a review of our South Asian programs, Sri Lanka stands out as a nation emerging from decades of horrific ethnic conflict with great promise for development. But, in frankness, there are a few troubling challenges as well. The Maoist insurgency in Nepal has caused us to reevaluate our program there. In fact, we are working closely with our Mission Directors and Ambassadors across the region to re-evaluate whether our aid programs adequately address today's challenges. If they do not, we must either reshape or drop poorly performing activities. This is a continuing and evolving process that takes on new urgency in light of transnational threats such as terrorism. Our success in realigning aid programs to meet urgent needs and uphold MCA principles will depend on our own management flexibility and adequate resources.
Mr. Chairman, we applaud the leadership of this Committee in addressing many key issues such as HIV/AIDS, tuberculosis and malaria as well as your work on promoting international religious freedom, combating the crime of trafficked persons and preventing famine. We look forward to continued close cooperation with you and your committee as USAID implements its development programs based on the President's vision of foreign aid as articulated in the Millennium Challenge Account and in Administrator Natsios' vision for the Agency, Foreign Aid in the National Interest.
Pakistan - A New Program
USAID opened a field mission in Pakistan in June, 2002 after 12 years of rupture following the imposition of sanctions in 1990. We currently have seven direct hire employees in the mission to manage a FY 2004 program of $200 million in ESF, and $75 million in Development Assistance, including $25 million for Child Survival and Health.
Our goals and objectives directly reflect our desires to strengthen Pakistan's capacity to combat terrorism by encouraging just governance, investment in people, and encouraging economic freedom. These programs are just getting off the ground now, so we cannot gauge their full effectiveness yet. However, we are convinced they are aiding the Pakistanis to address the country's most critical needs.
Education: Our highest priority is investing in the people of Pakistan. The illiteracy rate is 53 percent, one of the highest in the region. Nearly 40 percent of young people ages 15 to 20 are unemployed, with few marketable skills and little prospect of meaningful employment. Clearly, we need to invest in education, and we are not alone in this assessment. Pakistanis and international organizations also view the education sector as the single most important area for development. Right now, USAID is enhancing teacher training for both public and private primary schools. We are providing funds to improve curricula, encouraging community involvement in the local schools and supporting adult and youth literacy programs.
Governance: In October 2002, Pakistan held a national election which restored civilian government with a Prime Minister and National Assembly, but the democratic institutions in Pakistan are weak. Our focus is on strengthening democratic institutions and political parties, including the National Assembly and locally-elected legislatures. We also have a tremendous opportunity to work with communities and local, provincial and national elected officials on local development problems. To make sure that the people of Pakistan are informed and can take full advantage of these steps toward a stronger democracy, USAID is assisting Pakistan's emerging private radio and television industries as well as the public media.
Health: Democracy and education are not the only serious issues facing Pakistan. Health is also a critical area of need. Infant mortality rates in Pakistan are 83 per 1000 live births, which compares poorly with other countries in the region. Only 31 percent of married women between the ages of 15 and 49 seek prenatal care, and the gap between rural and urban areas is large. In addition, Pakistan's annual population growth rate is one of the highest in the world at 2.8 percent. To address these issues, USAID has formed a partnership with the British that begins in the spring of this year. Our work will focus on maternal and child health, family planning and AIDS prevention at the provincial and community levels. Meanwhile, the British Department for International Development will support the Federal health ministries.
Economic Growth: Pakistan is a poor country of 140 million, with 40 percent of the population living below the poverty line. Recent economic growth rates have been disappointing, and low levels of foreign investment have only made the situation worse. The GDP growth rate, which was at almost 7 percent in the 1960s, slowed to about 3 percent in the 1990s. Since 1993, growth has slowed even further, pulling Pakistan below the regional average by 1.5 to 2 percent. To stimulate growth, we are implementing a two-pronged approach. At the national level, our goal is maintain macroeconomic stability, reduce Pakistan's foreign debt and encourage the Pakistan Government to meet IMF goals. On a local level, USAID will promote microenterprise to create jobs in some of Pakistan's poorest and hardest-to-reach regions.
Overall, we have tailored the USAID program to Pakistan's primary development issues and have used the ESF cash transfer mechanism to address Pakistan's foreign debt. The FY 2003 transfer of $188 million will be used to buy down $1 billion in debt. The FY 2002 transfer was used to secure Pakistani spending in the social sector.
Sri Lanka-A success story
Sri Lanka is another clearly defined example of putting the Administration's policies of accountable foreign aid to work in our region. We are moving swiftly, in response to the promising ceasefire and peace process there, to accelerate our investments. You may recall that until last year, Sri Lanka was on the road to becoming a non-presence post. We have reversed those staffing decisions and requested additional resources in FY 2004 in recognition that, at last, they are on the right track.
In the near term, a peacefully negotiated settlement of the conflict is essential in order to secure a healthy environment for economic growth and promote U.S. trade interests. USAID's humanitarian assistance and longer-term economic reforms are designed to ensure the 'peace dividend' is distributed equitably among the peoples of Sri Lanka.
Successfully reintegrating the thousands of Internally Displaced Persons and refugees from India into their home communities and resettlement villages will require significant human and material resources. Homes, schools and hospitals need to be rebuilt. Water and sanitation infrastructures must be rehabilitated, and we need to make sure people have ways to earn a living and support their families.
The FY04 budget justification requests $19.5 million, targeting three main areas: increasing the country's competitiveness in global markets (37%), building constituencies for peace through transition initiatives (31%) and democracy & governance reform (23%). The remaining funds (9%) will be directed to humanitarian assistance and the regional US-AEP activities.
Nepal -- A trouble spot
Today the situation in Nepal is more hopeful than it has been in over a year. Just last week, representatives of the Maoist rebel group and the Government mutually agreed to a Code of Conduct, a peaceful foundation for future negotiations towards a longer-term political settlement to the conflict. A few months ago, however, the future of Nepal appeared bleaker. A Maoist insurgency practiced unspeakable brutalities, intimidations and murder. It controls a large share of the countryside. The Maoist insurgency benefited from popular outrage over years of government corruption and denial of service to the people.
The destructive effects of the Maoist insurgency, however, should not detract from the gains Nepal has made over the past fifty years. It has transformed itself from an isolated medieval kingdom to a constitutional monarchy. Child mortality and fertility rates have significantly decreased. Literacy and food security have improved.
Yet, these development gains are unevenly distributed. Poor governance and corruption, the forbidding mountainous terrain and lack of basic infrastructure, like roads, have led to wide disparities across regions and ethnic groups and between rural and urban populations. In the past, these inequities provided a fertile ground for the insurgency that resulted in over 7,000 deaths since it began in 1996.
It is our greatest challenge to meet the immediate needs of those communities most affected by the conflict, former combatants and victims of torture, without losing sight of the Government's needs through successive stages in the peace process. USAID plays an important piece in the USG's larger strategy in Nepal. Our emphasis is on health, economic security and governance reform to combat the poverty and feelings of disenfranchisement that facilitated the six-year insurgency. Our task is to expand opportunities for employment and generate growth in the private, trade, agriculture and energy sectors. We will reinforce that work with efforts to improve public sector management to deter corruption and strengthen the rule of law.
Bangladesh-Highs and lows
Bangladesh is one of a handful of moderate, democratic Islamic nations in the world today. It is also an ally in the U.S. Government's efforts to combat terrorism. Promotion of democracy is an important U.S. objective in Bangladesh, since achieving and sustaining economic growth is based upon a strong democratic system of government. The need to combat HIV/AIDS has recently been added as a high level U.S. interest because the country appears to be on the brink of a serious HIV/AIDS outbreak. While HIV/AIDS prevalence is low today, Bangladesh shares most of the characteristics of high prevalence countries. Action is needed now to avoid the politically, socially and economically destabilizing affects of a widespread epidemic.
This year Bangladesh exceeded USAID's targets for economic growth. In fact, other donors, the business community, and the Bangladesh Government view USAID's small business and agribusiness projects as leaders in innovative, business-driven approaches. Moreover, USAID was able to respond to several opportunities during the course of the past year by initiating new interventions in the areas of information and communications technology (ICT), bank supervision, a national enterprise survey; a new trade leads facility, and a new Government investment strategy that complements longer-term activities. While the U.S. Mission hopes the Government of Bangladesh will export its abundant gas, should it ultimately decide against exports, USAID will phase out that element of its energy sector assistance strategy and concentrate efforts on further development of the power sector.
Unfortunately, governance problems continue to hamper growth. For the second year in a row, Bangladesh was ranked as the most corrupt of 102 countries surveyed in Transparency International's annual corruption perceptions survey. Power and resources are highly centralized, leaving local government bodies with little ability or authority to control decisions that affect their constituencies. Political parties need support to transform bitter rivalry into constructive opposition. Only then can the Parliament focus on the many complex national issues facing the Bangladeshi people. Elections will be held in 2006. Rather than risk a poor outcome by last-minute, ad hoc activities, now is the time to start providing constructive assistance to level the playing field.
With limited prospects for the Government's real assistance in this area, USAID seeks to mobilize civil society. Our goal is to build demand for policy reform in the areas of local governance, parliamentary and political processes and human rights. This work has already met with some success for better informing the public. With three years of USAID support, Transparency International Bangladesh (TIB) has become a regional leader, coordinating the 2002 household corruption survey for not only Bangladesh, but also four other South Asian countries. We are also working at the community level to improve basic education, introduce innovative learning techniques, and integrate family planning and promote health to reduce long-term poverty and encourage economic growth and democracy.
India-A Transforming Relationship
India has the potential to be a catalyst for economic growth and development in an unstable region, and is a key U.S. ally in the war on terrorism. At the same time, India-the world's largest democracy of 1.1 billion people-is home to over 300 million people living in abject poverty (more than Africa and Latin America combined).
USAID's program in India advances U.S. national interests: economic prosperity through opening markets; global issues of population growth, infectious diseases, and climate change; democracy concerns of alleviating poverty, reducing malnutrition, and improving the status of women; and enhancing India's ability to save lives, reduce suffering, and recover faster after natural disasters.
One of our biggest successes has been in reducing CO2 emissions from the supply side. Now USAID is focusing on the demand side of the energy equation-distribution reforms. This is where policy changes can be felt at the local level, by providing consistent power for individuals and businesses, a direct result of improved revenue collection. Such reforms will also reduce state subsidies, leaving more budget room for badly needed social sector investments.
USAID is providing high-level technical assistance to the Government of India in the area of economic growth. At the national level, our focus is on reforming state fiscal policies and private pensions. At the local level, we are helping local governments finance public infrastructure and improve policy. We are also emphasizing technology, trade and resource-allocation initiatives. For example, USAID played a key role in establishing the Securities and Exchange Board of India. In the water sector, the Government of Tamil Nadu approved the $200 million Tirupur Water and Sanitation project-made possible through the USAID credit authorities, by providing loan guarantees for $25 million to be invested in this project.
India faces severe health challenges: over 4 million people are infected with HIV/AIDS; polio is re-emerging in the Northern portion of the country; and tuberculosis infections continue. USAID has ongoing activities in all these areas to assist the Government of India control these health problems. Our work in the State of Tamil Nadu has successfully tempered the growth of HIV/AIDS, setting a model for others in India.
Illustrative of our deeper engagement as part of America's transforming relationship with India, USAID is starting up new sectors such as education and governance to help address low literacy rates and streamline backlogged courts. Our activities will target improving access to elementary education, justice, and other social and economic services for vulnerable groups, especially women and children. We are also undertaking a new, more proactive approach to disaster preparedness and mitigation that will reduce vulnerabilities for marginalized people, ensure quicker economic recovery, and train state governments to respond in disaster situations.
Conclusion
In conclusion, Mr. Chairman, I would cite President Bush's words: "we fight against poverty because hope is an answer to terror. We fight against poverty because opportunity is a fundamental right to human dignity. We fight against poverty because faith requests it and conscious demands it. And we fight against poverty with a growing conviction that major progress is within our reach". We look forward to joining with you and your committee in that fight.
Thank you.
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