[Senate Hearing 108-289]
[From the U.S. Government Publishing Office]
FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS
APPROPRIATIONS FOR FISCAL YEAR 2004
----------
THURSDAY, JUNE 5, 2003
U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 2:08 p.m., in room SD-192, Dirksen
Senate Office Building, Hon. Mitch McConnell (chairman)
presiding.
Present: Senators McConnell, Bond, DeWine, Burns, Leahy,
and Landrieu.
AGENCY FOR INTERNATIONAL DEVELOPMENT
STATEMENT OF ANDREW S. NATSIOS, ADMINISTRATOR
OPENING STATEMENT OF SENATOR MITCH MC CONNELL
Senator McConnell. The hearing of the Foreign Operations
Subcommittee will come to order. I want to welcome
Administrator Natsios. It is always a pleasure to have you
before this subcommittee.
Let me begin by acknowledging the difficult task you and
your agency face in the post-September 11 world. With the
welcomed liberation of Iraq and Afghanistan comes the need for
immediate and significant relief and reconstruction programs.
These activities are often conducted in dangerous and dynamic
environments and your courageous field staff, NGO partners, and
contractors should be recognized for the risks they are willing
to assume in coming to the aid of the Afghan and the Iraqi
people.
Emerging from decades of repression, these countries
require the full gamut of U.S. assistance programs from food,
water, and health care to governance, economic development, and
rule of law programs. Concurrent with addressing the needs of
newly liberated countries, USAID must keep an eye on those at-
risk nations--such as Pakistan, the Philippines, and
Indonesia--where threats from terrorism have yet to subside.
Again, a broad range of development programs are required to
deny the breeding grounds--such as poverty, illiteracy, and a
lack of economic opportunities--for extremist ideologies and
terrorism.
Finally, no less pressing or deserving of attention are
USAID programs and activities conducted in developing countries
in Africa, Southeast Asia, and elsewhere. There seems to be no
shortage of global crises, whether human catastrophes caused by
corrupt governments or health emergencies fueled by expanding
HIV/AIDS infection rates.
A business-as-usual approach is no longer adequate in
meeting new and pressing demands on our foreign assistance.
While the fiscal year 2004 foreign operations budget request is
$2.7 billion above the fiscal 2003 level, the majority of this
increase is targeted toward new presidential initiatives that
appear at first glance to maximize and make more efficient the
delivery of U.S. foreign assistance.
For example, the Millennium Challenge Account proposes
increased assistance to those countries meeting certain
eligibility requirements, including a government's commitment
to ruling justly, meaning a country's leadership has the
political will to respect and enforce the rule of law, protect
freedoms and liberties, and crack down on corruption. Many
nations currently receiving U.S. foreign aid will not qualify
for MCA funds because of this requirement. To maximize the
impact of our foreign aid dollars, perhaps we should consider
expanding the ``ruling justly'' requirement to our more
traditional bilateral assistance programs.
Let me just close with a few comments on the reconstruction
of Iraq. First, the subcommittee would appreciate your
assessment of how programs are proceeding on the ground and an
analysis of those obstacles and challenges the coalition will
face in the weeks and months ahead. Second, many of our
colleagues and I have been contacted by American companies
eager to assist in the reconstruction of that country and
today's hearing affords you an opportunity to clarify how
contracts are being awarded and where those companies can turn
for information and assistance.
PREPARED STATEMENT
Finally, it would be useful to articulate what you believe
the long and short-term expectations of the Iraqi people are in
terms of reconstruction and democratic governance.
With that, let me call on my friend and colleague Senator
Leahy, the ranking member, for his opening statement.
[The statement follows:]
Prepared Statement of Senator Mitch McConnell
Welcome, Administrator Natsios. It is always a pleasure to have
your appear before this subcommittee.
Let me begin by acknowledging the difficult task you and your
Agency face in the post-September 11 world.
With the welcomed liberation of Iraq and Afghanistan comes the need
for immediate and significant relief and reconstruction programs. These
activities are often conducted in dangerous and dynamic environments,
and your courageous field staff, NGO partners and contractors should be
recognized for the risks they willingly assume in coming to the aid of
the Afghan and Iraqi people.
Emerging from decades of repression, these countries require the
full gamut of U.S. assistance programs--from food, water, and health
care to governance, economic development and rule of law programs.
Concurrent with addressing the needs of newly-liberated countries,
USAID must keep an eye on those at-risk nations, such as Pakistan, the
Philippines and Indonesia, where threats from terrorism have yet to
subside. Again, a broad range of development programs are required to
deny the breeding grounds--such as poverty, illiteracy, and lack of
economic opportunities--for extremist ideologies and terrorism.
Finally, no less pressing or deserving of attention are USAID
programs and activities conducted in developing countries in Africa,
Southeast Asia, and elsewhere. There seems to be no shortage of global
crises, whether human catastrophes caused by corrupt governments or
health emergencies fueled by expanding HIV/AIDS infection rates.
A ``business as usual'' approach is no longer adequate in meeting
new and pressing demands on our foreign aid. While the fiscal year 2004
foreign operations budget request is $2.7 billion above the fiscal year
2003 level, the majority of this increase is targeted toward new
Presidential initiatives that appear at first glance to maximize and
make more efficient the delivery of U.S. foreign assistance.
Fox example, the Millennium Challenge Account (MCA) proposes
increased assistance to those countries meeting certain eligibility
requirements, including a government's commitment to ``ruling
justly''--meaning a country's leadership has the political will to
respect and enforce the rule of law, protect freedoms and liberties,
and crackdown on corruption.
Many nations currently receiving U.S. foreign aid will not qualify
for MCA funds because of this requirement. To maximize the impact of
our foreign aid dollars, perhaps we should consider extending the
``ruling justly'' requirement to our more traditional bilateral
assistance programs.
Let me close with a few comments on the reconstruction of Iraq.
First, the subcommittee would appreciate your assessment of how
programs are proceeding on the ground and an analysis of the obstacles
and challenges the coalition will face in the weeks and months ahead.
Second, many of my colleagues and I have been contacted by American
companies eager to assist in the reconstruction of Iraq, and today's
hearing affords you an opportunity to clarify how contracts are being
awarded and where these companies can turn for information and
assistance.
Finally, it would be useful to articulate what you believe the
long- and short-term expectations of the Iraqi people are in terms of
reconstruction and democratic governance.
I look forward to your testimony.
OPENING STATEMENT OF SENATOR PATRICK J. LEAHY
Senator Leahy. Thank you very much, Mr. Chairman.
First, Mr. Natsios, we are always pleased to see you and
glad to have you here. As you know, I have been a strong
supporter of USAID. I am always impressed by the quality of the
men and women who work there, both in Washington and overseas.
I do not always agree with where the funds go, but we need to
work together.
I remember the mid-1990s, when some of my colleagues in the
other party in the other body were trying to shut down USAID.
It did not happen. I also would point out that the chairman of
this subcommittee has been one who has strongly supported the
wise use of foreign aid. He has done it with the care that
Senators of both parties ought to emulate.
But now you are under assault from your own administration
and from some in the House and the Senate. I will give you a
couple of examples. The President wants to set up another
bureaucracy outside of USAID to run the Millennium Challenge
Account. The AIDS bill which the President just signed takes
all your HIV/AIDS money and the power to decide how it is used
and gives it to an independent coordinator. The Pentagon, not
USAID or the State Department, is in charge of the biggest
international relief and reconstruction effort in recent years,
in Iraq.
So I look forward to hearing your perspective on the future
of USAID. It seems to me the White House sees you as
increasingly irrelevant.
I am also interested in hearing your views on nation-
building. I remember the President's National Security Adviser,
Dr. Rice, criticizing the Clinton Administration for nation-
building in the former Yugoslavia. To quote her, she said: ``We
do not need the 82nd Airborne escorting kids to kindergarten.''
However, nation-building today is a major theme of the
administration's foreign policy. It is still the same world it
was just a few years ago, but then nation-building was a bad
idea, today it is a good idea. We are engaged in nation-
building on a scale unlike anything since the Marshall Plan
from Iraq to Afghanistan to East Timor to the Balkans.
I believe we do have a strong interest in helping these
countries rebuild, but that does not mean that I agree with
everything that is being done. In Afghanistan, President Bush
said we need a Marshall Plan. Last year, the administration did
not request a cent for Afghanistan, and the amount of aid the
President has requested since September 11 pales in comparison
to the Marshall Plan.
In fact, last year, when the administration did not put in
the money for their so-called Marshall Plan for Afghanistan,
Congress had to take resources from other, very important
programs to give to Afghanistan. Even the amount we
appropriated fell short. Warlords continue to wield power over
large areas of the country. Afghanistan's future remains far
from secure.
In Iraq, it seems as if we are making it up from one day to
the next. Months after the fall of Saddam Hussein, millions of
Iraqis are without adequate water, shelter, employment, or any
idea of what lies ahead. Yet everybody in both parties said
these issues would have to be addressed after the war in Iraq.
We all knew we would win the war, whether we supported it or
not. We were sending the most powerful military the world has
ever known against a fourth-rate military power; of course we
are going to win. But nobody really thought much about what to
do afterward.
Two months ago we appropriated $2.4 billion for Iraq relief
and reconstruction. Monday OMB said there is no coherent plan
or strategy for what to do with that $2.4 billion.
The President has received a lot of credit for increasing
funds to combat AIDS. I totally agree with the President, but I
doubt many people know that to do that his budget cuts just
about everything else that we are doing in international
health, all the programs that have been supported by both
Republicans and Democrats for as long as I can remember. He
would cut child and maternal health programs, aid for
vulnerable children, funding to combat other infectious
diseases, which kill millions of people, mostly children, the
kind of diseases our people do not have to even worry about
because it is only a matter of pennies to pay for the
vaccinations.
But the money for these programs is being cut to fund the
AIDS bill. It also cuts family planning.
Development assistance--the President's budget would cut
funding for these core programs, agriculture, children's
education, democracy-building--by $35 million. That makes no
sense, and I think it goes back on the pledge that the funding
for the Millennium Challenge Account is in addition to, not in
place of, funding for existing programs.
I worry about procurement at USAID. Everything you are
trying to do is being hampered by bottlenecks in your
procurement office. I know that is one of the things you want
to fix and I want to know when it is going to be fixed.
With that I will stop, Mr. Chairman.
Senator McConnell. Thank you, Senator Leahy.
SUMMARY STATEMENT OF HON. ANDREW S. NATSIOS
Mr. Natsios, we will put your full statement in the record
and if you could give a brief summary, we will maximize the
opportunity for questions.
Mr. Natsios. Thank you very much, Senator. I want to thank
the committee, both parties, for the strong support that our
Agency has received from you Senators as well as from your
staff. Paul Grove and Tim Rieser have been extraordinarily
helpful and cooperative with us. We do not always agree on
everything, but we appreciate the cooperative and open spirit
that we have in dealing with the staff of the committee.
The last year has seen changes that none of us anticipated
in many areas of the world, and we have began a number of major
new activities that I would like to talk about. Last fall we
issued a set of papers called the ``Foreign Aid and the
National Interest Report'' that tracks where we expect foreign
assistance to go, broadly speaking, over the next decade. It is
on our web site. We have widely distributed it. It is done by
some of the preeminent scholars in development assistance and
humanitarian relief in the country. Larry Diamond, for example,
wrote the first chapter; he is one of the two great democracy
scholars in the United States. But it is a road map. It is a
direction for where we need to go, what has worked and what has
not worked.
We have begun new initiatives in agriculture, in basic
education, in trade capacity building. In the budget that you
have before you, all of these areas will show increases in
funding. Basic education goes up by over $45 million,
agriculture goes up by about $10 million.
In addition, we have funded both in the State budget and
the AID budget a line item should there be a just and equitable
peace settlement in Sudan. We are the closest we have been in
20 years to a peace agreement in Sudan, and in our budget we
have committed that should peace break out the U.S. Government
would provide funds for reconstruction in Sudan.
There is I think great excitement in the agency because of
the enormous potential for the expansion of the foreign
assistance program of the U.S. Government. The President has
proposed essentially a 70 percent increase in the budget for
foreign assistance over the next three years through the
Millennium Challenge Account and the HIV/AIDS account. We are
already spending about a billion dollars, all spigots, on HIV/
AIDS. The President has proposed an additional $2 billion. Of
course, the Millennium Challenge Account is a $5 billion
increase, the first installment of which, $1.3 billion, is in
the fiscal 2004 budget.
You ask, Mr. Chairman, about the Iraq and Afghanistan
reconstruction. We would be glad to send you a detailed account
of what is going on in both those budgets, but in the budget
for 2004 between State and AID in all spigots for our two
budgets, the 150 account, we have proposed $657 million in the
2004 budget for reconstructing Afghanistan.
This year AID alone is spending, because of your
appropriation, $350 million in five major initiatives in
Afghanistan. One is a major new agricultural initiative, $150
million over three years; a health initiative to extend health
care across the country, 400 new health clinics of the 1,100 we
believe need to be put in place to serve the country; a 300-
mile road which is critically important to tieing the Pashtun
south, Kandahar, with Kabul, which will be completed by
December of this year--imagine building a road from Boston--I
come from New England--to Washington in eight months, in an
area that is the most insecure in the country. We are
progressing, though, substantially.
We have democracy and governance programs. We are helping
the national Government with advice on options they have for
writing their new constitution, which is a process that is
ongoing now.
We also have an economic governance package that went into
effect in September of last year, October of last year, which
helps with the selling off of state-run enterprises, all of
which are bankrupt, a new budgeting system for the national
Government, a new customs collection system, a new uniform
commercial code. We helped create the currency for the country
that was issued last fall, working with the central bank. And a
new education initiative where we will build 1,200 schools
across the country and double the number of textbooks. We
printed 15 million, we are going to print another 15 million,
for a total of 30 million. We are the source of textbooks for
public education in Afghanistan.
In Iraq, we have spent $450 million on the humanitarian
relief side, mostly on food aid, to make sure there is a bridge
between now and the time the Oil for Food program goes into
effect later this summer.
We have spent $98 million so far of the reconstruction
money and another $234 million has been released by Congress
and by the OMB that will shortly be put in the reconstruction
accounts. We have an elaborate plan for how to spend that
money. I can only speak for what I do. We have a plan for
spending $1.1 billion in reconstruction and $600 million for
humanitarian relief. We started designing that last October
with 200 staff from AID. There are 100 AID staff now in Iraq or
in Kuwait City where some of our offices are working.
Finally, I would like to mention the question that you
brought up, Senator, on the procurement system. We indeed have
a new procurement software system which we hope to install, but
we cannot install it until after the new Phoenix system for our
financial management has been installed in the field. It has
been installed in the Washington and beginning actually last
week we initiated a 25-month plan to install Phoenix in the
missions, in 79 missions around the world. Actually, it will be
in a reduced number of missions--we are collapsing the number
of accounting stations--but it will serve the field.
Once that is in place, there are two things we can attach
to it. One is this new procurement system, which will make much
more efficient the way in which we do our procurements. The
second thing we will be able to do is an information warehouse
software package, which will allow information--the questions
you give us now that we must manually calculate because we do
not have and have not had for 25 years a unified financial
management system worldwide. We will have that within 25 months
if all goes according to plan.
So the business systems reforms are 50 percent there, but
they are not finished yet, and until they are I will not be
satisfied. But we do appreciate very strongly the support of
the committee in this.
I want to just end by making a comment about extending the
MCA standards, which you, Mr. Chairman, very thoughtfully
brought up, as an option for our regular programs. We have
proposed in fact to the White House and to the Congress a
package that seeks to restructure AID, not from a statutory
standpoint, but we will look at countries and divide them
specifically into the following categories:
Countries that just barely missed being eligible for MCA
status, but want to make it, and they will require heavy
reforms and focus on the areas where they failed to meet the
MCA standards. So we will direct our resources in those
countries in the areas where they were failing.
The second are countries that are failed and failing
states. We have a new bureau. It is not new any more, it is two
years old, but we have reorganized. Roger Winter heads that
bureau, who is widely known in the NGO community and the human
rights community. It is a bureau that deals with failed and
failing states, called Democracy, Conflict, Humanitarian
Assistance. That bureau has more money in it than ever in AID
history. It is up to almost $2 billion this year, for failed
and failing states, for countries that are not even remotely on
the chart for MCA, but that we do not want to forget.
The third category are countries that are in our
geostrategic interest. Egypt, Jordan, Pakistan are three ESF
countries. They are in a separate category. We must make those
countries' programs be geared to the geostrategic national
security interests, narrowly defined, of the United States
Government. We need to treat them in that category.
Finally, there are countries that just are not close to
making it. We need to ascertain in those countries whether
there is the will to reform, and if there is the will to reform
we will help them move toward MCA status, but it will take a
while to get there. And if there is no will and the country is
really stuck and there is no chance of it getting out because
of the absence of political leadership, we will work
exclusively through the NGO community and the university
community and not deal with the Government.
PREPARED STATEMENT
Senator, I know you have a lot of concerns about several
countries in Asia in that category, which we would very much
agree with you on. But we need to think clearly about which
countries fit in which categories and restructure our program
along those lines.
I would like to submit my written testimony, which is much
more lengthy, for the record.
[The statement follows:]
Prepared Statement of Hon. Andrew S. Natsios
Chairman McConnell, Senator Leahy, members of the subcommittee:
Thank you for inviting me here today to discuss the President's budget
for the U.S. Agency for International Development for fiscal year 2004.
THE STRATEGIC IMPORTANCE OF DEVELOPMENT ASSISTANCE IN THE NEW
MILLENNIUM
We live in an era that has seen dramatic change in recent years--an
era that is rapidly evolving. Globalization, technology, HIV/AIDS,
rapid population growth, terrorism, conflict, weapons of mass
destruction and failing states--these are just some of the issues
shaping today's world. Most of these issues--both good and bad--do not
recognize national borders. They affect us directly and are
dramatically altering the way in which we think and operate.
The Bush Administration is restructuring and revolutionizing our
national security apparatus so we can better respond to the challenges
facing the world today. Under the President's leadership, USAID is also
changing. Where appropriate, we are applying lessons we have learned
over the years, whether in Afghanistan or Iraq, or in the fight against
HIV/AIDS in Africa and around the world. This ability to adapt will
determine our success as part of the President's resolute campaign to
attack poverty, ignorance and the lack of freedom in the developing
world.
In September 2002, President Bush introduced his National Security
Strategy. In it, the President discussed development as a vital third
pillar of U.S. national security, alongside defense and diplomacy. Thus
for the first time, the Strategy recognizes the importance of both
national and transnational challenges, such as economic growth,
democratic and just governance, and HIV/AIDS to our national security.
The President's National Security Strategy identifies eight
concrete goals. Two of them speak directly to our development mission.
The first is to ignite a new era of global economic growth through free
markets and free trade. The second is to expand the circle of
development. Trade capacity building lies at the intersection of these
two goals, and supports both. It promotes USAID's core concern with
development, while reinforcing the core U.S. trade policy goal of
further opening up and expanding international trade.
Foreign assistance will be a key instrument of U.S. foreign policy
in the coming decades. As a consequence, our foreign assistance budget
is poised to rise dramatically. The President's recent budget requested
a dramatic increase in the development and humanitarian assistance
account, from $7.7 billion in fiscal year 2001 to more than $11.29
billion in fiscal year 2004. It is clear that this Administration has
taken development off the back burner and placed it squarely at the
forefront of our foreign policy. But this is only one piece of an
unprecedented and concerted commitment by President Bush and the U.S.
Government make foreign assistance more effective.
THE CHANGING LANDSCAPE OF FOREIGN ASSISTANCE
Looking back over several decades, one must recognize that the
developing world has made significant progress. Of the world's 200
countries in 2001, for example, 124 were democracies at least in some
form. This is an unprecedented number. Similarly, most of the world's
6.2 billion people now live in countries where some form of market
economics is practiced. This is a dramatic increase since 1980.
Population growth rates are down, and in some parts of the world health
and education levels have surpassed U.S. levels of 50 years ago.
Globalization has integrated the world's markets for goods, services,
finance, and ideas. Remarkable advances in biotechnology are bringing
the promise of new cures for the sick and new kinds of seeds and food
for the hungry.
But we still face an uncertain future. In many developing
countries, HIV/AIDS and health issues are having a dramatic impact on
social cohesiveness and economic strength, blocking the very
development goals we seek. Virtually all the new democracies in the
world today are fragile; others are democracies more in name than
substance. Nearly a quarter of the people living in developing
countries, or about one billion people, live in absolute poverty. There
are a host of other threats--ranging from terrorism to infectious
disease and violent conflict--that challenge us and the developing
nations we seek to help.
Events such as the Monterrey Conference on Financing for
Development and our recent report, Foreign Aid in the National
Interest, are helping us focus clearly on what has been accomplished so
far and what needs to be done to meet the challenges that lie ahead.
The President's Millennium Challenge Account (MCA), announced at
Monterrey, is a direct outgrowth of what USAID and our development
partners have learned.
Simply put, development assistance works best when nations have
responsible institutions and governments that pursue policies conducive
to economic growth. Democratic governance, sound policies, and open,
transparent institutions are the keys to development. Performance, not
intentions, is what matters most, so we have learned the importance of
measuring that performance with rigorous and unbiased indicators.
Many of the grave issues facing the developing world require us to
take new approaches. We have to revolutionize how we think about aid in
general and USAID in particular. The issue of how to deal with failed
and failing states is just one example. As the President's National
Security Strategy stated, ``America is now threatened less by
conquering states than we are by failing ones.''
Under the leadership of President Bush and Secretary of State
Powell, we now have both the opportunity and the obligation to
implement a development strategy that clearly defines our challenges
and identifies the best approaches to address them. We are working more
closely than ever at the interagency level to clarify the roles and
linkages of U.S. development institutions. The work done on the MCA is
an example of this renewed interagency coordination. Working with the
State Department to develop a joint strategy should greatly improve
coordination of our foreign assistance programs.
THE MILLENNIUM CHALLENGE ACCOUNT AND THE ROLE OF USAID
As I stated in earlier testimony on the MCA, I find it helpful to
think of countries in five broad groupings:
--MCA countries or the best performers.
--Countries that just miss qualifying for the MCA and with a little
help have a good chance of doing so.
--Mid-range but performing counties with the commitment to reform.
For these countries, our assistance will focus on achieving
progress in specific aspects of development, especially
economic growth and democratic governance.
--Selected failed, failing, and post-conflict states that require
specialized assistance, post-conflict reconstruction or
humanitarian assistance. This is a new element of the Agency's
core business. In these countries our objective will be
establishing greater security, stability and order. Programs
will focus on food security, improving governance, and building
the collective sense of nationhood that must precede evolution
to more democratic forms of government and lay the groundwork
for countries to move toward longer-term development.
--Countries requiring assistance for strategic national security
interests.
I would like to highlight our belief that focusing on responsible
governance and good performers must infuse all our development
efforts--not just the MCA. This should be the case for other bilateral
and multilateral donors as well. In this way, the MCA will serve as a
model for all of our assistance programs. Indeed, we are already
applying an MCA lens to our country programs, informing resource
decisions. The strategic budgeting system that we will be adopting will
base the allocation of resources on criteria such as need, performance,
commitment, and foreign policy priority. The intent is to have a more
performance-driven and cost-effective foreign aid program that is fully
responsive to our national security objectives.
STRATEGIC DIRECTION AND BUDGET PRIORITIES
USAID manages program funds from a number of Foreign Affairs
accounts directed at addressing a broad array of international issues
facing the United States. These range from fighting the HIV/AIDS
pandemic to sustaining key countries supporting us in the war on
terrorism to bolstering democracy, the rule of law and good governance
in countries important to our national security. Many of these issues
were highlighted in Secretary Powell's excellent testimony before this
subcommittee on April 30.
For fiscal year 2004, the Administration's request from the
accounts USAID manages is $8.77 billion in program funds. The account
breakout is provided below followed by a discussion of program
priorities.
--$1.345 billion for Development Assistance, and $1.495 billion for
Child Survival and Health; $235.5 million in International
Disaster Assistance; $55 million for Transition Initiatives.
--$2.535 billion in Economic Support Funds; $435 million for
assistance for Eastern Europe and the Baltics; and $576 million
for assistance for the Independent States of the Former Soviet
Union. We co-manage these funds with the State Department.
--$1.185 billion in Public Law 480 Title II funds are managed by
USAID.
Our readiness to manage these resources and deliver the results
intended is of particular importance to me. The budget request for
salaries and support of our staff that manage these programs is $604
million. In addition we request $146 million for the Capital Investment
Fund, $8 million to administer credit programs and $35 million to
support the Office of the Inspector General.
Economic Growth, Agriculture and Trade.--The Administration's
request for these programs is $2.316 billion, including $584.2 million
in Development Assistance.
Economic growth is an essential element of sustainable development
and poverty reduction. Trade and investment are the principal
mechanisms through which global market forces--competition, human
resource development, technology transfer, and technological
innovation--generate growth in developing and developed countries.
During the 1990s, developing countries that successfully integrated
into the global economy enjoyed per capita income increases averaging 5
percent annually. However, countries that limited their participation
in the global economy saw their economies decline.
In the President's National Security Strategy, he set the goal of
igniting a new era of global economic growth through free markets and
free trade. At the March 2002 International Financing for Development
conference in Monterrey, Mexico, leaders of developed and developing
counties agreed that trade and investment are critical sources of
development finance--far outweighing foreign assistance in the broader
context of international capital flows. President Bush pointed out that
developing countries receive $50 billion a year in aid, while foreign
investment inflows total almost $200 billion and annual earnings from
exports exceed $2.4 trillion.
I am proud that USAID has just issued a new Trade Capacity Building
Strategy as a cornerstone of our economic growth efforts. In developing
this strategy, USAID has worked closely with Ambassador Zoellick, the
U.S. Trade Representative. USAID will enhance trade capacity building
programs with new initiatives to support developing countries'
participation in international trade negotiations and help countries
develop trade analysis expertise. To support trade agreement
implementation, USAID will introduce new programs to promote sound
systems of commercial law and improved customs management. USAID will
also help developing countries establish open and competitive markets
in service sectors that are critical to trade and strengthen economic
responsiveness to opportunities for trade. We will build on the success
of the Africa Growth and Opportunity Act (AGOA) to provide market-
access for goods produced in sub-Saharan Africa. We are also
implementing the President's Trade for African Development Initiative
(TRADE) and preparing Central American countries to adopt a Central
America Free Trade Agreement (CAFTA), for which we began negotiations
earlier this year. We are also carrying out a broad range of trade
capacity building activities throughout the Americas in support of the
negotiations for a Free Trade Area of the Americas.
Economic growth and poverty reduction also depend on increased
productivity at the firm level. Strong micro-enterprise and small
business sectors will continue to receive emphasis as important
elements of USAID's approach to growth.
For many poor countries with largely rural societies, agriculture
connects poor people to economic growth. A vibrant and competitive
agricultural and business sector fosters growth. And a supportive
policy and institutional enabling environment encourages enterprise,
innovation and competitiveness.
Agricultural development remains a critical element of USAID's
approach to economic growth and poverty reduction. Most of the world's
poorest and most vulnerable populations live in rural areas and depend
on agriculture. In fiscal year 2004, the budget request includes $268.4
million in Development Assistance and $470.2 million from all accounts
for agricultural development.
The requirements for agricultural development are well known.
Increasing productivity will lead to higher incomes and more investment
in the agricultural sector. USAID programs will address these factors
at the national, regional and local levels and increase attention to
agriculture in Latin America and Africa. Particular emphasis is being
given to the President's Initiative to End Hunger in Africa. We will
also boost agriculture in developing countries by restoring the budgets
of global agricultural research centers, training scientists, and
funding science-based applications and biotechnology. Additionally, we
will work to connect farmers to global supply chains by encouraging
agricultural trade reform, supporting producer organizations and
promoting needed market infrastructure.
Modern biotechnology offers great promise in addressing food
insecurity in Africa and elsewhere in the developing world. We are
helping build national and regional biotechnology research programs
that focus on increasing the productivity and nutritional quality of
African food crops. A good example is our support for the African
Agricultural Technology Foundation, a partnership between USAID and
several private entities.
Environment.--The Administration's request for environmental
programs is $449.2 million including $286.4 million in Development
Assistance.
Environmental degradation is an increasing threat to long-term
development with severe effects on health, trade, and poverty reduction
efforts in general. Effects can be felt directly in the United States,
as in the case of climate change. It is in our interest to ensure that
policies and institutions actually support sustainable development.
USAID's efforts will focus on four initiatives: Water for the Poor;
Clean Energy; the Congo Basin Forest Partnership; and Global Climate
Change, as well as ongoing programs in natural resource management,
forestry, reducing illegal logging, and minimizing pollution.
Democratic Governance.--The Administration's request for Democratic
Governance from all accounts is $1.0208 billion including $164.8
million in Development Assistance.
Governance based on principles of accountability, participation,
responsiveness and effectiveness is the foundation of development and
the key to achieving progress in the three areas named by President
Bush in the MCA--ruling justly, promoting economic freedom, and
investing in people. Our democracy and governance programs will give
new emphasis to strengthening public administration, assisting policy
implementation, and providing citizen security, all of which are
integral to democratic governance. We will continue to support
assistance programs involving human rights, the rule of law,
strengthening political processes, promoting civil society including
organized labor, and building local government capacity. Anti-
corruption programs will receive special attention and funding.
Programs to prevent trafficking of persons and assist victims of war
and torture will also be continued.
One of the most significant lessons we have learned is that
governance--policies, institutions and political leadership--and not
resources alone, matter most. Thus, USAID will reduce assistance to
countries where a commitment to democratic governance is lacking. This
``tough love'' approach is necessary, if we are to provide resources
where they can be most effective. At the same time, governance is
critically important in ``fragile'' and failed states. USAID will begin
to selectively offer support in such countries towards the provision of
security, stability and reconstruction which will provide the basis for
future development.
While we face democratic governance challenges around the globe,
they are particularly acute at this time in the Mid East and broader
Muslim world.
Health and Education.The Administration's request for Health is
$2,136.2 million from all accounts, with $1.495 billion in Child
Survival funds. Over half of the Child Survival request, or $750
million, is for HIV/AIDS programs. The Education and Training request
is $425 million from all accounts, with $262.4 million of that
Development Assistance.
Fundamental to economic growth is improving people's health and
education. Many developing countries' workforces will grow over the
next two decades. As a result, some developing countries will have more
human resources to invest in economic endeavors. But for that to
happen, investments must be made today so that their economies grow,
and their workers are healthy and educated.
As we are witnessing with HIV/AIDS in many developing countries,
health dramatically affects a country's development prospects and must
be aggressively addressed if overall development is to take place.
USAID remains a global leader in HIV/AIDS prevention, care and
mitigation programs. Under the guidance of the White House Office of
National AIDS Policy, USAID is working closely with the Department of
Health and Human Services to implement the President's Mother and Child
HIV Prevention Initiative and to prepare the foundations necessary for
delivery of treatment, care, and prevention, as outlined in the
President's Emergency Plan for AIDS Relief. USAID will continue and
strengthen support to international partnerships, including key
alliances with the private sector, and the Global Fund for AIDS,
Tuberculosis and Malaria.
USAID's programs in the areas of child survival, maternal health,
vulnerable children, infectious diseases, family planning and
reproductive health are cornerstones of U.S. foreign assistance. Our
health programs save millions of lives through cost effective
immunization, disease prevention, breastfeeding, nutrition, sanitation
and voluntary family planning programs.
While our leadership has brought about important successes, 11
million children under the age of 5 still die every year, the vast
majority of them from preventable and treatable diseases such as
measles, diarrhea and pneumonia. Four out of every 10 people lack
access to basic sanitation; 42 million people live with HIV/AIDS. Our
effectiveness in preventing illness and pre-mature death contributes to
global economic growth, poverty reduction, and both regional and
domestic security.
Global markets are changing, as more developing countries shift
from production based on low-wage labor to higher-end manufacturing.
Doing so requires workers able to learn new skills and master new
technologies. In countries where access to primary schooling remains
incomplete and educational quality remains inadequate, the urgency of
educational reform is increasingly apparent. Where improvements are
enabling more students to finish primary school, countries need to
ensure that new skills can be acquired. Taking full advantage of the
global economy requires workers with the academic and technical skills
to adapt technology to local conditions. While continuing to help
countries make educational improvemenzts, U.S. foreign assistance must
help more successful countries maintain their upward momentum. The
President's Education for Africa Initiative, which addresses a range of
basic education needs, is an important element in this effort. We are
working closely with the international Education for All program to
provide resources for those countries who demonstrate performance and
commitment to educating their children.
Internal Conflict.--This budget request includes $27.7 million in
Development Assistance specifically for intra-state conflict, as well
as $55 million for Transition Initiatives. Additional funding for
conflict management and mitigation can come from our various sector
programs, most importantly Democracy and Governance and Humanitarian
Assistance.
USAID's goal is to be an agent for peaceful change, wherever and
whenever possible. We cannot realistically prevent every conflict. We
are, however, working hard to improve our ability to mitigate and
manage conflict. Some two-thirds of the countries where we work are
entering conflict, engaged in conflict, or just recovering from a
conflict. The causes are complex, and there are no quick and easy
solutions. Yet at a general level, conflict prevention and management
entail a continuum of interventions that, done carefully, can
strengthen the capacity of states to manage sources of tension. A
crucial part of the solution is encouraging innovative institutions
that can deal with problems--local, regional, national, and
international--and resolve them peacefully.
Our Office of Transition Initiatives provides a fast and flexible
response capability to address the needs of countries experiencing
significant political transitions or facing critical threats to basic
stability and democratic reform. Recent interventions, for example,
helped Afghanistan, Burundi, East Timor, and Macedonia. New programs
are being initiated in Angola, Sudan, and Sri Lanka.
Among the most important things that donors can do is develop a
deeper, context-specific understanding of what drives conflict. This
will require a significant investment in research and analysis among
donors and in countries where conflict programs are being considered.
Every major focus of our assistance has at least some bearing on
conflict--from economic growth, to agriculture, to democracy and
governance. We will apply a cross-sectoral, multi-disciplinary
perspective when designing programs in environments of conflict. We
will apply a conflict lens to each area in high-risk countries.
Recognizing the complexity of conflict prevention, mitigation and
management, we will coordinate closely with other USG departments and
agencies, donors, and other partners.
Humanitarian Aid and Failed States.--The Administration's request
is $1.69 billion, including $1.185 billion for food, $200 million for
the new Famine Fund, and $235.5 million for disaster assistance
programs. USAID is addressing the challenge of forging a comprehensive
response to failed and failing states: examining the sources of
failure, working to build institutional capacity, and providing
critical humanitarian aid to the most vulnerable.
More than three million people lost their lives in the disasters of
the 1990s. Conflict-related emergencies were the most deadly, with many
hundreds of thousands of people killed in direct fighting. Millions
more have been internally displaced or forced into refugee status. By
the end of 2000, failed and failing states displaced 25 million people
within their own countries and 12 million refugees who fled across
national boarders. While conflict-related disasters have dominated the
funding and focus of international assistance over the last decade,
natural disasters still take a tremendous toll worldwide. There were
three times as many natural disasters in the 1990s as in the 1960s.
Extreme weather related events are projected to increase. In addition,
HIV/AIDS and other communicable diseases are on the rise in complex
humanitarian emergencies, with more than 75 percent of epidemics of the
1990s occurring in conflict areas.
The United States is the world's largest humanitarian donor. We
provide life-saving assistance to people in need of food, water,
shelter and medicine. Coordinated by our Office of U.S. Foreign
Disaster Assistance (OFDA), USAID deploys quick response teams that
include experts from USAID and other USG agencies. Our Public Law 480
Title II emergency food aid has provided critical food needs in
Afghanistan, Ethiopia, Southern Africa, and other protracted
emergencies. USAID is playing a lead role in providing humanitarian aid
in Iraq. We are prepared, and with the support of other USG agencies
and our implementing partners, we will do our utmost to avert a
humanitarian crisis. Along with immediate humanitarian relief, USAID is
prepared to contribute to political reform and stability.
We will continue to respond to humanitarian needs to save lives and
minimize suffering. But we need to do more to reduce vulnerabilities
that transform natural, socio-economic and political events into
disasters. For example, the promotion of accountable governance and a
free press will help defend against famine and conflict. The
development of local and global capacity to anticipate and respond to
emergencies will be reinforced by enhancing early warning systems that
guide policies and public action in countries at risk. We will do more
to link humanitarian response with longer-term development goals, in
particular in health. Child immunization programs, for example, have
sometimes served as a bridge to peace, with cease-fires respected even
in war zones. Closer coordination with other donors will ensure our
response is effective and the burden of humanitarian aid is more evenly
shared.
We will work to strike a balance among political, military and
humanitarian strategies. By coordinating closely with the U.S. military
we can carry out relief operations even in the midst of war. At the
same time, we strongly affirm the neutrality of humanitarian
assistance, which should be based on assessed need. More emphasis must
be placed on protecting those who receive emergency relief from
violence or human rights abuse, whether refugees or internally
displaced persons (IDPs). We will encourage our implementing partners
to improve accountability of humanitarian aid by adopting standardized
measures of effectiveness.
In his fiscal year 2004 budget, the President announced a new
humanitarian Famine Fund. This is a $200 million contingency fund for
dire, unforeseen circumstances related to famine. Use of the fund will
be subject to a Presidential decision and will be disbursed by USAID,
under the same authority as International Disaster Assistance, to
ensure timely, flexible, and effective utilization. The Famine Fund is
intended to support activities for which other funding is either
unavailable or inappropriate and will increase the ability of the
United States to anticipate and respond to the root causes of famine.
Mobilizing Private Foreign Aid.--Today private sources of foreign
aid account for over 50 percent of the total assistance coming from the
United States. Foundations, corporations, private and voluntary
organizations, colleges and universities, religious organizations, and
individuals provide $30 billion a year in aid. Given this new reality,
we at USAID are expanding our partnerships with a full array of private
sources and undergone a fundamental reorientation in how we relate to
our traditional development partners.
Two important approaches to achieving this are: (1) our Global
Development Alliance which works to mobilize resources from and foster
alliances with U.S. public and private sectors in support of USAID
objectives; and (2) Development Credit Authority which is an Agency
mechanism to help develop credit markets and to issue partial loan
guarantees, thereby mobilizing private capital for sound development
projects. Examples of these partnerships are:
--In Brazil, USAID is working with private companies and NGOs to
encourage low-impact logging.
--The Digital Freedom Initiative (DFI) is an outstanding example of
what can be accomplished when several branches of the U.S.
Government and leading American companies like Cisco and
Hewlett-Packard join forces to help long-time friends like
Senegal build on Senegal's already significant information and
communication technology base. The DFI will also facilitate the
development of information communications technology
applications that enable small and medium-sized businesses to
become more profitable, find new markets, and access credit and
other inputs more easily. Over the life of the pilot activity,
we envision that more than 350,000 small businesses will be
involved.
--In Angola, USAID is cooperating with a U.S. oil company to promote
business development in rural communities. The first activity
planned will assist 150,000 Angolan families affected by the
civil war (former soldiers and internally displaced people) by
providing agricultural support and training. We view this as an
important step in consolidating the recent peace.
--In Guatemala, a credit guarantee covers a portfolio of loans to
small businesses, small-scale producers and cooperatives
operating in the Peace Zone, a rural area of Guatemala that has
suffered from political unrest, and normally is without access
to commercial credit.
OPERATING EXPENSES AND STAFFING
The President's budget request calls for us to manage a program
budget of $8.8 billion at a time when foreign aid challenges are
growing increasingly complex and the environment in which we operate
more dangerous. We face the triple challenge of addressing: (1) the
increased strategic importance of funding key countries and programs;
(2) rising costs of protecting U.S. personnel overseas; and (3) rapid
retirement of many of our most experienced officers. These call on us
to:
--Reform our business systems to enable innovative and streamlined
business models for Washington Headquarters and our field
missions to strengthen our ability to quickly respond in
today's political environment.
--Strengthen our future readiness by ensuring that our Civil Servants
and Foreign Service Officers have the skills and competencies
needed in increasingly complex settings.
--Expand our intellectual/knowledge capital to meet future demands.
--Ensure accountability in program implementation in increasingly
complicated structures.
--Recruit the right people at the right time, train and deploy them
to meet our development mandate.
--Protect the safety of our staff, overseas and in Washington.
We request a total of $604 million for our operating expenses. This
amount, combined with $49.7 million from local currency trust funds and
other funding sources, will provide a total of $653.8 million to cover
the Agency's projected operating expenses.
In addition, we request $146 million for the Capital Investment
Fund (CIF) to fund Information Technology to support major systems
improvements that will strengthen the Agency's ability to respond and
operate effectively; develop enterprise architecture in collaboration
with the Department of State to enable an integrated accounting system
worldwide; and, fund new office facilities co-located on embassy
compounds where the State Department will begin construction by the end
of fiscal year 2003.
We also request $35 million to ensure continued operations of the
Office of the Inspector General associated with USAID's programs and
personnel and $8 million for managing credit programs.
MANAGEMENT IMPROVEMENT
Mr. Chairman, I know that you and this Committee are very
interested in our management reform efforts. I would like to update
you, therefore, on our progress in this area. Meeting foreign policy
and program management challenges requires a modern, flexible and well-
disciplined organization. In close coordination with the President's
Management Agenda, USAID is aggressively implementing an ambitious
management reform program including the introduction of new business
systems, processes and changes to our organizational structures.
--In conjunction with the State Department's Diplomatic Readiness
Initiative, we will ensure that the Agency has adequate numbers
of staff to meet present and future national security
challenges. In fiscal year 2004, for example, USAID will
recruit, train, and assign up to 50 additional direct hire
staff overseas to address staffing gaps resulting from
retirement of Foreign Service Officers.
--We are also evaluating, with the Department of State, the
feasibility of more closely linking some of our business
systems to achieve operating efficiencies.
--And we are working closely with the Department of State to improve
our support for U.S. public diplomacy and public affairs
efforts overseas, especially targeting the Muslim and Arab
worlds.
I am pleased to report to the Committee that:
--We have implemented improvements to the Headquarters core
accounting system and improved financial and performance
reporting. We have expanded cross-servicing and outsourcing,
including grant management (HHS), loan management (Riggs) and
payroll (NFC).
--We have closed the Agency's material weakness on reporting and
resource management, and received an unqualified audit opinion
on four of five principle financial statements (and an overall
qualified audit opinion for the first time.)
--We have made progress in improving employee morale and employee
satisfaction with management services. For example, my second
annual Agency-wide survey of all employees' opinions and
attitudes, completed in November 2002, showed that 63 percent
of those responding rated their morale as ``good'' or
``outstanding.'' Improvements in performance by business
function ranged from 20 points for human resources and
information services to 37 points for financial management and
procurement services. While the results indicate we have made
progress, there remains room for improvement and we still have
a lot of work ahead of us.
--We are in the process of developing a comprehensive Human Capital
Strategic Plan designed to address both USAID's particular
needs and the President's Management Agenda requirements. The
plan will address a critical need to rebuild and train our
workforce, to put the right kind of people with the right
skills in the right place. It will also address our need to
have surge capacity to meet crises such as in Afghanistan and
Iraq.
--We have piloted an automated e-procurement system and deployed e-
procurement capabilities to speed the purchase of frequently
used goods and services.
--We are drafting a knowledge management strategic plan to reposition
the Agency as a global leader on development issues and to
facilitate knowledge sharing among partners and staff.
Completion is expected by mid-2003.
--We have developed a strategic budgeting model to enable us to link
performance and resource allocation more efficiently.
This year we began implementing the plans for human capital,
knowledge management, and strategic budgeting. We will procure new
acquisition and assistance software, begin pilot testing our Phoenix
financial management system overseas, and reintroduce the International
Development Intern program for recruitment and training of junior
Foreign Service officers.
IN CONCLUSION
This budget request is founded on three precepts:
--Foreign aid and the Agency for International Development are
essential elements of our country's national security
apparatus.
--Our programs are evolving to meet the challenges of the new
millennium.
--We are pressing ahead with the management reforms begun in 2001 and
transforming USAID into an organization of excellence.
Mr. Chairman, I would like to assure Congress that USAID's budget
request for fiscal year 2004 rests on a solid foundation of
professional analysis and a strong commitment to performance and
management reform. We know it is impossible to satisfy everyone who
looks to us to address every problem that arises. We have spent many
hours trying to determine the best use for our resources and have had
to make many painful choices. I hope my remarks today have been helpful
in explaining our priorities, and I look forward to working with you
over the coming year as we move our foreign policy agenda forward.
Thank you.
Senator McConnell. As I indicated earlier, that will be
made part of the record.
Since we have a number of Senators here, I am not going to
take my full 5 minutes, but I do want to begin by focusing on
another part of the world that has been very much in the news
this past week--Burma. I introduced yesterday along with
Senator Feinstein and a number of co-sponsors, including my
friend and colleague Senator Leahy, a bill that would impose
sanctions on Burma, including a ban on exports and restriction
on visas and the like.
I have had an opportunity to speak with Deputy Secretary of
State Rich Armitage, Deputy Secretary of Defense Paul
Wolfowitz, and National Security Adviser Condolezza Rice about
the situation in Burma and I am hopeful that the administration
will support the bill and that we can get it through Congress
in short order.
But I want to focus on Burma and USAID. Last year, we put
$1 million in our budget for HIV/AIDS programs in Burma with
the full appreciation that the military regime that runs that
country has no interest in its people and with the condition
that this relief would be administered through international
nongovernmental organizations in consultation with Burmese
democracy leader Avng San Suu Kyi.
I am curious, given the fact that Suu Kyi has, for most of
the last 13 years, been under house arrest, how USAID and its
contractor have been able to consult with her in coordinating
the HIV/AIDS programs in Burma.
Mr. Natsios. Senator, I do not know specifically our
conversation with her, but I will get back to you on the
question. I do know that we have initiated the HIV/AIDS program
through the NGO community. There is also $500,000 I believe the
Congress has appropriated in the budget for 2003 for democracy
programs, which we were also supposed to and will consult with
her as to how that money should be spent.
We are all appalled by what has happened in the last few
weeks. It appears that the regime has moved 10 years back in
time. She is, as you know, under much more constrained
circumstances. She appears to have been physically harmed in
the latest attacks and we are extremely disturbed by the course
of events. So we will work very closely with your staff to see
to it that we structure our program, however modest it may be,
along the lines of what you have suggested in your remarks.
Senator McConnell. Well, we are hoping the U.N. Special
Envoy Mr. Razali Ismael will be able to see her tomorrow when
he is in the country. Somebody needs to see her to verify that
she is still alive and well, given that she has been attacked.
How do you provide any kind of oversight for the use of
U.S. foreign assistance in Burma?
Mr. Natsios. We have opened a regional office in Bangkok,
Thailand, because we are doing increasing programs in countries
in which we cannot have an AID presence. So that new office is
to provide oversight for the programs we run in Laos and the
programs that we run, limited ones, in Burma.
Senator McConnell. Given the difficulty of carrying out any
of these functions--since you have to do it by working around
and not through the regime--could USAID handle an increase in
HIV/AID funding?
Mr. Natsios. Yes, we could.
Senator McConnell. You could.
Mr. Natsios. We work in countries in the middle of civil
wars, with extraordinarily repressive regimes. Sudan, North
Korea we have worked in before. I can give you a list of
countries where we----
Senator McConnell. Does the regime actively interfere with
the NGO's inside Burma trying to help on this issue?
Mr. Natsios. I think in the health sector they do not. It
depends on whether or not the regime believes that the
activities are threatening them in a direct sense, and health
is an area where the programs tend to not be as threatening as
some other kinds of programs.
Senator McConnell. Well, I would be interested in any
thoughts you might have before we start drafting this year's
foreign operations appropriations bill as to how we might
enhance the opportunity to consult with Suu Kyi and the NGO's
to improve the situation in Burma.
Mr. Natsios. We will get back to you, Senator, on that.
Senator McConnell. Okay. I am going to cut short my round
and then go to Senator Leahy and Senator DeWine.
Senator Leahy. Thank you. Thank you, Mr. Chairman.
Incidentally, Mr. Natsios, I want to call your attention to
the efforts of Barbara Best. She has been working with my staff
up in Vermont on the so-called LakeNet Project. It is a good
project. I would invite you up to see it some time. I invite
you up, Mr. Chairman, to see it. The Lake Champlain area is
very pretty.
Mr. Natsios, let me read you an article from a magazine
written recently. I quote it:
The blithe assumptions of the Iraq War's Pentagon
architects that a grateful Iraqi Nation, with a little help
from American know-how and Iraqi oil cash, would quickly pick
itself up, dust itself off, and start all over again are as
shattered as the buildings that used to house Saddam Hussein's
favorite restaurants. In Baghdad and many other iraqi cities
and towns, civic society has degenerated into a Hobbesian state
of nature. Despite the heroic efforts of a scattered minority
of mid-level Iraqi civil servants, the services that make urban
life viable are functioning, at best, erratically. More often,
they do not function at all. One of the few things that thrives
now in Baghdad is a deepening distrust and anger toward the
United States.
In Iraq, what is USAID's role? And how do you feel about--
this was from the New Yorker magazine, incidentally. How do you
feel about that criticism? Is it accurate?
Mr. Natsios. First, I would say that this is a time, an
event in progress, which is to say events change very rapidly.
So what was true a week after the war ended is no longer true
now.
Senator Leahy. Let us just talk about today.
Mr. Natsios. Okay.
Senator Leahy. How many people do you have there today?
Mr. Natsios. We have 100 people between the DART team, the
Disaster Assistance Response Team from the Humanitarian Relief
Bureau, and we have 27 people in the USAID mission, headed by
Lew Lucke, a career foreign service officer we recalled from
retirement who was the mission director in Jordan, speaks
Arabic, knows the Arab world very well.
Senator Leahy. Is he living in Baghdad?
Mr. Natsios. He is in Baghdad right now.
Senator Leahy. He is not living in Kuwait?
Mr. Natsios. He was in Kuwait before the war started and it
was difficult the first month because we did not have
electricity, running water, et cetera, in the place in which we
worked. I think we just moved this week into a convention
center facility, which is quite good and has all of the
conveniences we need to keep our staff functional. So the
staff, more and more of them are moving up to Baghdad now.
Senator Leahy. Would it be more--what would you anticipate
the number of USAID workers be 2 months from now?
Mr. Natsios. The same number. We are at what we need to do.
We are transitioning, though, out of the humanitarian relief
mode because we did not experience a humanitarian disaster. We
expected three things would happen that did not happen, thank
heavens. We expected that Saddam would turn, in his fury on the
Kurds, the Shias in the south, the Turkmen, other ethnic groups
that he hates and that he has visited terrible things on in the
past. He did not do that.
Two, we were afraid--he could consider blowing up the large
dams and flooding the country, which he did during the Iraq-
Iran War. Third, we were afraid there would be large-scale
population movements, internally displaced and refugees. There
were not. There were almost no population movements.
So there were pockets of need. We answered those and we
have moved into a transition phase. So the Office of Transition
Initiatives has taken the leadership now of the DART team and
we will move into public employment programs, which we have
begun in Baghdad neighborhoods now. Four city councils have
been set up in Baghdad--or village councils, I should say, in
neighborhoods, that have been elected or chosen by the people
in the village, in the neighborhood, and they are beginning to
make decisions. We are providing small grants for improvements
in these neighborhoods.
In Umm Qasr, the port, we just opened our first Internet
cafe. They do not have the Internet, they did not until now. I
thought it was sort of a mundane thing. It was a very emotional
thing, because we took people from the mosque and the new city
council and showed them what the Internet was. Several people
were stunned and broke down during the demonstration because
they did not know this thing--they heard rumors of it; they did
not know it really existed. They said: We have been cut off all
these years to this.
Senator Leahy. I think that is an extremely positive thing.
I was a little bit troubled. Maybe I misunderstood what you
said earlier. I agree with you, I am delighted that he did not
lash out at the Kurds while we were in there and that all the
weapons he may or may not have had, that none of them were used
against our troops.
But you had to anticipate that there was going to be real
problems in a number of the cities, just watching CNN at night
and seeing the buildings being bombed, the electricity being
cut off, water being cut off. Seeing the news about the
looting, the destruction at the hospitals--apparently we did
put tanks around the oil ministry, but the other places--I
still do not have a very comfortable feeling about what we are
doing.
Your director is in Baghdad? He is not in Kuwait?
Mr. Natsios. No, no, no.
Senator Leahy. He does not go back there at night?
Mr. Natsios. No, no, no. He comes--part of our procurement
staff and our technical staff that does the paperwork is still
in Kuwait because there is infrastructure----
Senator Leahy. That does not bother me.
Mr. Natsios. The director, in fact we talked to him
yesterday. He is in Baghdad. He has been in Baghdad for the
last week, I believe.
Senator Leahy. For a week?
Mr. Natsios. Well, he was back here to his daughter's
graduation, I think.
Senator Leahy. But he is there now?
Mr. Natsios. Right.
Senator Leahy. So you have got somebody on the ground. What
is his security when he goes out? Can he move around in these
areas?
Mr. Natsios. AID has a set of armored vehicles that we use
around the world. We keep them in a warehouse and we move them
around wherever we need them. We used them in Bosnia and
Kosovo. We used them in East Timor. We are using them here. So
we have our own security, which no other, other than the
military, no other group has, and we do use those, particularly
the DART team.
But let me just answer the question you asked, Senator. In
terms of water and electricity, which are critical functions,
this is not a poor society. This is potentially a very wealthy
society, given they have water. It is an educated society or
was very educated in the 1980s. It has deteriorated since then.
Basically, the infrastructure is there; it simply has not
been maintained for 20 years because the money has been put
elsewhere. Right now in Iraq, other than Baghdad there is more
electrical power and better water than there has been since the
mid-1980s. We did this only in two months. When I say ``we'', I
would like to say we did it all ourselves. We did it with the
British military, the NGO community, the UN agencies. AID paid
for a lot of it and so did DFD, the British aid agency. The
civil affairs units have been very helpful and the rest have
been very helpful.
But right now in Basra, for example, the second largest
city, they have had 24 hours electrical service now for 3
weeks. They have never had that since before the first Gulf
war. The water system is in far better shape. Now, is it what
it should be? No. But it is far better than it has been since
the Gulf war.
So things are actually improving. And I have to give credit
also to some of the Iraqis. We went to some cities in the south
and the Iraqi engineer said that he would not let us fix the
water system: We know how to fix it; we're technically
competent; just give us the parts. We brought the parts and we
watched them. They fixed the water system within 24 hours.
In villages that had not had water in 10 years, Shia
villages, that because they had been in revolt were being
punished, they said we physically were not allowed to repair
them. They did it themselves with our parts.
Our doctors--I thought the doctors would be underskilled,
but one of our very senior medical doctors said: These guys are
as skilled as Western European or American doctors. In fact, we
do not need even to train them. They are highly skilled
technically. Just they have no equipment, the hospitals are in
terrible condition for many years except for the Baathist Party
members' hospitals, and what we need to do is bring the other
hospitals in the Shia and Kurdish areas up to the same standard
as Baghdad's hospitals.
Baghdad still has problems with electrical power, but we
are now at 70 percent of what we were in terms of electrical
levels from before the war, and that is a dramatic increase
over 2 weeks ago.
Senator Leahy. My time is up and I will submit my other
questions for the record, but especially a question I want to
give a lot of attention to. In the supplemental, of the $2.4
billion we put in for Iraqi relief and reconstruction, we
included assistance to Iraqi civilians who suffered losses as a
result of military operations. That is something we can do and
please have your staff work with mine about it.
Mr. Chairman, I went way over time. I appreciate your
courtesy.
Senator McConnell. Thank you, Senator Leahy.
OPENING STATEMENT OF SENATOR MIKE DE WINE
Senator DeWine. Thank you, Mr. Chairman.
Administrator, thank you very much for being with us. I
have two questions. They are obviously related, but they are
separate. One is I want to congratulate you and congratulate
the administration for putting emphasis once again on
agriculture development, very, very important. If you look at
where your numbers are in 2002 and 2003, very positive.
I congratulate also this subcommittee--I was not on the
subcommittee then, so I can say that, I guess--in the money
that was appropriated. Our numbers that you have proposed in
2004 are down just a little bit, but it is still pretty good
numbers.
I would like for you to address your vision for agriculture
development and where that fits in in our whole overall foreign
aid program.
Second, I am concerned about what is the reports and what
is going on in Africa in regard to the famine. I am pleased to
see that the administration has requested money for the
emergency famine fund, but I wonder if this is going to be
enough and I wonder if you can tell us where you think we are
going there and what the rest of the international community is
doing.
Mr. Natsios. With respect to agriculture, Senator, I do
appreciate your bringing it up because this is one of my and
the President's and Secretary Powell's big initiatives. The
President has announced this. We announced it, one, at the
World Food Summit in June of last year, and the President has
made subsequent announcements at the G-8 on agricultural
development to end hunger.
We need to understand there is a relationship between
economic growth in most of these countries and food insecurity
and poverty. Most of the poorest people in the world live in
rural areas and they are farmers or herders. If you do not deal
with agriculture, you cannot deal with poverty.
Why is it that the Asia giants like Taiwan and South Korea
and Thailand have much the best distribution of wealth in the
world? Why does Latin America have the worst distribution of
wealth in the world? The reason is because of the green
revolution in Asia, which AID in the mid-1960--with the World
Bank and the Rockefeller Foundation--orchestrated. This effort
included improving seed varieties and introducing new
technologies in agriculture, and investing in the rural areas.
In Latin America, they did not invest in the rural areas and as
a result of that there is a gross imbalance between the rural
areas in Latin America and the cities, like two different
countries. That is not true in Asia.
I just want to also point out that since 1980 we have
calculated in the developing world that 50 percent of the
improvement in productivity in agriculture is the result of
improved seed technology. Our research scientists have produced
improved seed that has dramatically revolutionized agriculture
in many third world countries.
We believe that investing heavily in these seed
technologies can make great progress, not the end to all
problems, because you have to connect production to markets--
you know, if you grow more food and the prices are wrong,
farmers are not going to grow more food in the future. One of
the causes of the complex food emergency that we are
experiencing in Ethiopia is bad economic policies in the
region--restrictions on trade, for example. Farmers grew more
food 2 years ago, prices collapsed, they could not sell their
food, and as a result many of them were in deep financial
trouble because they had borrowed money to buy seed and
fertilizer. They said: We are not doing this again; we are
going to only grow enough food to survive; we are not growing
any surpluses.
That is when we had the crop failures. It was not just
because of drought. It was also because of economic policies
and lack of free trade in East Africa.
So we believe investing in these technologies can make a
huge difference, and we do appreciate the support of the
committee between 2002 and 2003. There were constraints on us
for 2004, but agriculture is very, very important.
I might also add that there is a perception that it is only
the large lumber companies that are destroying the rain
forests, the Congo rain forest for example or the Amazon, the
big companies. That is not the case. Slash-and-burn agriculture
is widely used in the developing world by farmers who have
completely exhausted the nutrients in the soil because they
have no fertilizer, no improved seeds, and they are so poor
they simply burn down more forest to grow food.
It is a direct connection between sustainable agricultural
development and sustainable environmental programs. They are
connected to each other, and if you get peasants to be more
prosperous and their incomes go up and you do the program
right, you can do a lot for the protection of environmental
diversity in the developing world.
With respect to famine in Africa, we are facing a
catastrophic situation in Zimbabwe. That is entirely manmade.
It is made by Robert Mugabe, who leads a predatory, tyrannical,
and corrupt Government that is wreaking havoc on Zimbabwean
society. That is a manmade event. There was a drought, but in
fact even with the drought there did not have to be any food
insecurity in that country at all because half of the
agricultural system was irrigated. It was large farms, it was
irrigated, and the irrigation reservoirs were full. But because
he confiscated the land and did not have anybody competent to
run the farms, the farms did not produce any food. They would
have produced food even in a drought because of the irrigation
systems.
Now the abuses in Zimbabwe are getting so horrendous that
society is beginning to break down, and there is hyperinflation
on top of it developing.
The other place we face an emergency is in Ethiopia. The
U.S. Government began last September stepping up to the plate
to what was a fast onset famine, which normally does not take
place. Usually we have advance warning. The Ethiopian
Government did not get it and we did not get it and the
international agencies did not get it.
Why is that? Because we did not realize to what degree the
Ethiopian people were vulnerable from the last drought and
famine in 1999. They did not recover from it. They were
impoverished by it and as a result they were right on the edge
of catastrophe when this latest crop failure took place because
of the drought in the eastern part of the country.
We have pledged now 808,000 metric tons of food to
Ethiopia. Walter Kansteiner was with Prime Minister Melis
yesterday and he said there would be millions dead now but for
the intervention of the United States. Fifty-five percent of
all the food that went in this calendar year came from the U.S.
Government, 55 percent.
I do not want to go into the other donors. The British have
been extremely generous. Between the British and the United
States, we are leading the response. It is not just food,
because in a complex food emergency you also have to immunize
the kids because a lot of kids get malnourished and die of
measles. Measles epidemics are one of the most severe
challenges we face in famines, because when the human body
becomes malnourished the immune system breaks down and you die
of things like measles that most kids would not die from.
So we have got to do immunization campaigns. Water has
deteriorated because of the drought. So there are a set of non-
food interventions that we are now undertaking. There is a
Disaster Assistance Response Team in the country right now.
They will return next week and we will continue to step up the
response.
I want to add, Senator, if it were not for you and other
Members of the Senate adding funds for food aid into the
budget, we would not have the resources we need. I want to
thank the Senate for at exactly the right time giving us the
resources we need to increase our pledges to Ethiopia. I
promised Prime Minister Melis in January when I was there we
would not abandon the country and we have not done that. We
have been the leaders, and I think there are comments in Europe
about this now, about the fact the United States is there and
continental Europe is not.
Senator DeWine. Thank you.
Senator McConnell. Senator Landrieu.
OPENING STATEMENT OF SENATOR MARY L. LANDRIEU
Senator Landrieu. Thank you, Mr. Chairman.
Director Natsios, I appreciate the comments. Could you be a
little bit more specific about the current status of women both
in Afghanistan and Iraq? I understand that this is a
particularly difficult and complex situation, but one that, as
you can imagine, is crucial to the development of any
democracy. You touched on it in your statement, but could you
take a moment to just elaborate further on your focus and goals
and what progress we are making?
Mr. Natsios. With respect to Afghanistan, as you know, the
Taliban treated women in a deplorable way. Our goal has been to
raise the status of women within Afghan society, though I have
to tell you it is not us who are raising. They are raising
themselves. We are simply assisting the process. We have funded
a series of women-run newspapers in--not Baghdad--in Kabul that
connect the professional women of the city together, and we are
hoping to extend this to other areas of the country.
The second thing is, the first ministry we rebuilt was the
women's ministry. The roof had been blown off the building and
we put a new roof on and brought office equipment in so that
they could have a functioning ministry. There is a new human
rights commission which is led by one of the great women of the
country, a doctor, and she asked for our assistance in staffing
and we have provided technical assistance to her commission on
the human rights issues in Afghanistan.
The third point I would make is the way in which the status
of women can be improved in Afghanistan as well as many other
countries is through the education system. We made a deliberate
decision early on to invest heavily in educational development.
Two-thirds of the teachers in Afghanistan before the Taliban
were women. So we began a very aggressive campaign to train
teachers, many of whom only were literate. They were the
literate people in the village. They were not trained as
teachers. Many of them do not have college degrees.
So we trained them in how you organize a lesson plan and
how you use the books we printed. We printed books, half in
Dari, half in Pashto, the two major languages, for all the
major subjects from grades 1 through 12. We have printed
already 15 million for the back-to-school campaign last year.
They were so successful, the minister of education asked us to
make this the permanent curriculum of the country and they have
become; and to print another 15 million, and they were printed
recently and they are on a ship now and will arrive shortly for
school.
There were very few girls in school prior to the Taliban,
so what we did was we just allowed kids to go back to school
and then found out where the rates of girl returns were the
lowest and we have provided a vegetable oil subsidy for
families who regularly send their girls to school. We have got
the rate up to about a third now. In other words, it is not 50-
50, what it should be; it is two-thirds, one-third, but it is
better than zero, which is what it was before in many years.
That subsidy of vegetable oil is nutritionally useful. It
is fat content for the diet. But it is on top of their regular
ration, and in villages that are agricultural people love it.
It is very valuable. So we are noticing that this incentive is
having the effect of making sure the girls stay in school,
which is very useful.
Senator Landrieu. I appreciate that. Comment really quickly
about Iraq, if you would?
Mr. Natsios. Women had a much higher status in Iraq. Iraq
is probably the most secularized country in the region. This
was an urbanized society. Seventy percent of the people live in
cities. It was one of the most sophisticated and educated Arab
societies prior to the mid-1980s when the Iraq-Iran War started
the downward slide of the country.
It actually had a much higher rate of female literacy. The
rate of literacy now has dropped dramatically in the last 15
years for women in high school. There are girls in grammar
school, there are not in high school. I do not remember the
exact statistics, but I was shocked at how low the high school
girl rate of participation was.
Our intention is to have an aggressive campaign. A lot of
the money we will be spending will be rebuilding, we expect,
rebuilding or reconstructing about 6,000 schools. We have given
grants to UNICEF to do the curriculum. There were some concerns
we were writing all of the textbooks at AID.
But there is going to be an effort to make sure that there
is an equitable distribution of seats in those classrooms for
girls, because that is an important part of society. There is a
problem in Baghdad right now because security in some
neighborhoods, where parents are not sending their girls
because they have been abducted by some of these criminal
gangs, and so the rates have gone down in Baghdad. But we are
getting them up, we are getting them back up, in the areas that
are now secure.
Senator Landrieu. Well, I appreciate those comments,
because there are a number of us, and not just the women
Senators, although we remain very focused on this, who are
committed to the idea that one of the great and most
substantial long-term development improvements we can make is
providing an excellent education both for boys and for girls.
We must try to get children and people back into education, and
particularly focus on the women as students and teachers. So we
appreciate that.
Mr. Chairman, if I could make just one comment, not a
question, because my time is out. But Mr. Natsios, please
review the work that some of us are doing to establish a
permanent trust fund for the oil revenues in Iraq. This is
important if we wish to communicate in a very concrete way that
Americans, and hopefully our coalition partners, understand
that this resource belongs to the people of Iraq. We want to be
part of helping establish a framework under which those
resources can be used to build this country out of the chaotic
situation to a very bright future.
There are many different models, none of which is perfect.
Alaska has a good model; Louisiana has a smaller, different,
but effective one; Texas has had a model; Kuwait has yet a
different model. There are models around the world that could
be looked at.
The chairman of this committee has indicated an interest in
this and we are working on the exact mechanism, but I would
appreciate your consideration of that idea. Any comments
briefly you might have?
Mr. Natsios. If I could just respond to that, Senator. We
share completely your objective and the objective of other
Senators on the education front, not just in Afghanistan or
Iraq but around the world. In fact, we have increased the
education budget, primary education, by 100 percent in the last
2 years with your support. We do appreciate that.
But AID got out of the education business and out of the
agriculture business in the 1990s and now that money is
beginning to increase for those two areas. We know, for
example, that among farmers who are women in Africa that a
sixth grade education with no additional inputs will
dramatically increase agricultural productivity. So education
has a lot of side effects. It also has an effect on child
mortality rates, has an effect on lots of things.
So it is very desirable, very desirable that we invest more
money, particularly in primary, but also in high school
education.
With respect to the trust fund, the person in charge of
reconstructing Iraq for the United States is Ambassador Bremer.
We are very comfortable having him there because in every
country in the world in which we have an AID mission we report
to an ambassador and Jerry Bremer was a career officer and head
of Kissinger Associates, and he is a very good manager.
He understands AID. One of his division directors is Lew
Lucke, our mission director. Another is headed by Peter
McPherson, who was the AID Administrator from 1981 to 1987. So
Dr. McPherson knows AID well. He is a former Deputy Secretary
of Treasury and one of my best friends in this business, and he
is the head of the economics section.
So we have people who are advising----
Senator McConnell. Is he over there now?
Mr. Natsios. He is there now.
Senator McConnell. Did he resign as President of Michigan
State?
Mr. Natsios. He took a leave of absence from Michigan State
until September. We are hoping it lasts beyond September
because we are so pleased he is there.
But the trust fund is something that we not only endorse, I
think there is comment on the idea in the resolution that went
through the United Nations on reconstructing Iraq. The Pentagon
is in charge of creating that and if they want our help in
anything we will certainly give it to them.
But Ambassador Bremer is in charge. We report to him. We
are very comfortable with that. We are very happy with the way
things are moving in terms of the structure, organizational
structure. He is providing a lot of leadership.
Senator Landrieu. Thank you.
Senator McConnell. Thank you, Senator Landrieu.
Senator Bond.
OPENING STATEMENT OF SENATOR CHRISTOPHER S. BOND
Senator Bond. Thank you very much, Mr. Chairman.
Mr. Administrator, I would like to go back to follow the
line of questions that Senator DeWine asked. I very much
appreciated your comments on agriculture. We have talked about
this many times. I believe the old saying that a well-fed
person has many problems, but a hungry person has only one.
With all the problems you have got on your plate, hunger is
still one that we are very much concerned about, and successful
agriculture development. Just to share with you, a couple weeks
ago I had in my office a cotton farmer from South Africa, Mr.
T.J. Butalesi. He said he had spent 40 years growing cotton
with hard work and poverty. He said 3 years ago, despite Earth
First and Greenpeace, he planted his new genetically improved
cotton seed. He has more than doubled his yield. Instead of
spraying pesticides 10 times, he has sprayed 2 times. He said
he is now working smart rather than hard. He just built a new
brick house and his neighbors think he is the best farmer in
the region.
I very much appreciated your coming to St. Louis last year
to visit the Danforth Plant Science Center. As I think we
discussed, there they are working with Ugandan scientists, the
International Institute of Tropical Agrobiology and NGO's to
develop an exciting new approach to block out the Africa
cassava mosaic virus which is wiping out cassava crops, a
staple in most African diet.
I believe that you are working field trials with this. How
is that project going? What outcome do you expect to have from
it?
Mr. Natsios. I agree with everything you said, Senator. I
want to tell you, one of the highlights of my domestic trips
was the trip to the Danforth Center. It was quite an
extraordinary place and we are very pleased it exists and they
can be partners with us.
During the Johannesburg Summit, where this whole issue of
GMO grain came up for the first time, I had dinner with the top
GMO scientists in the universities of South Africa. These are
South African scientists now, developing seed for South Africa
and African farmers. It was extraordinary.
One of the women scientists was telling me they are
developing a new seed variety using genetic material that does
not require almost any water. They grow almost in rock or
desert conditions. They are going to put that into corn and it
could deal with one of the recurring problems we have in
Africa, which is drought.
I said: I want to know as soon as you have research in from
the trials on it whether this is going to be the success that
you think. She was so excited about it. She has been sending me
some of the material on it. We are helping to support that
research through the suggestions you have made in the budget,
which we strongly support continuing.
So they have extended this GMO material to white corn--
white maize--which we do not grow much of in the United States,
but which is a staple crop in South Africa. In some areas the
farmers have gone from $1,000 per capita income to $10,000
because of these improved varieties. It is not just in cotton;
it is also in maize that this is developing. It is quite
extraordinary.
Senator Bond. I very much appreciate the strong stand you
have taken in promoting improved food and agriculture through
the use of modern biotechnology, and I believe that the
President has stated very forcefully his policy. I thought you
might--I would like to get an update. I heard you were rather
clear in your warnings to certain African officials who were
allowing Eurosclerosis, the European Luddites, to prevent the
use of the fine genetically improved food that all of us here
eat every day. They were refusing to feed that to the hungry
people in their country.
I think you made--did you make some fairly clear warnings
to them? What is happening with that? How are we doing with the
Eurosclerosis?
Mr. Natsios. I will try to be a diplomat here, Senator. You
have a little bit more freedom than I do to characterize things
clearly.
People were shocked when I said, the President eats and all
of us eat our cereal in the morning and it is GMO and it has
been for 7 years, especially if you eat Corn Flakes. And they
looked at me, and I said: My children eat it, and there has not
been one lawsuit in the United States, and we are a very
litigious society, over anything, any health risks from GMO
corn in the United States.
It really is outrageous what has happened. I am so
disturbed after 7 years, 7 years of distributing this food aid
in countries around the world, that the groups that cause the
trouble, these groups that you mentioned earlier as well as
others, did it in the middle of a drought that was turning into
a famine, in the middle of the Johannesburg Summit. They
deliberately chose the middle of a food emergency to do it. I
mean, 7 years we have been distributing it and no one said
anything. And I mean, it was not exactly a secret that we have
been using GMO as a central part of our agriculture for years.
This is a trade issue. It is not a scientific issue. It is
not an environmental issue. In fact, it is damaging the
environment not to allow this technology to deal with these
environmental problems in the developing world. Most countries
in Africa cannot afford all these expensive inputs. This is one
way of them dealing with pesticides, herbicides, and
fertilizers that they cannot afford. This is why they cannot
get their productivity up, but they can through improved
varieties and through scientific research of the kind that we
have been investing in.
It is the potential. It is not going to solve all the
problems because, once again, you got to connect farmers to
markets, you have got to train people. There are other things
you have to do. But scientific research and technology is the
answer to part of our problem in agriculture in the developing
world. I believe genetic research, GMO research, can be one of
the great boons to agricultural development and to the
alleviation of poverty in the developing world, particularly in
Central Asia and in Africa, where the greatest poverty is in
the rural areas.
Senator Bond. Thank you very much, Mr. Administrator. That
is excellent.
I would just conclude, Mr. Chairman, by saying I thought
somebody from the U.S. Government warned leaders in the African
country if they refuse to feed their people the kind of food
that we eat every day because it is genetically modified that
they would haul them up before the World Court on genocide
charges. I do not know who that was.
Mr. Natsios. Well, I do not repeat some things I say.
Senator Bond. I do not remember who that was, but I thought
that was a nice subtle touch.
Senator McConnell. It was indeed.
Senator Burns, top that.
OPENING STATEMENT OF SENATOR CONRAD BURNS
Senator Burns. That is pretty easy.
Thank you very much, Mr. Chairman. Director, thank you for
coming today.
I want to not follow up on what Senator Bond said because
in Montana we have some of the foremost plant breeders and
livestock growers that can increase gene pools around the
world. I have a young man coming from Georgia, the Republic of
Georgia, to the United States this spring. In fact, he will be
in to see me not too long from now. We are talking about
increased agricultural production in Georgia, which they have
every right to expect that country to produce. He is the
minister of agriculture and he is very forward-looking, but he
is running into some of the same problems that we ran into down
in Africa.
But I want to ask you about another subject. In the
rebuilding of the infrastructure in Iraq, there are a couple of
things, and you hit upon one: how surprised they were about the
Internet. We know right now there are only about three phones
per every 100 citizens in Iraq. There is no wireless system,
and for all those systems and the infrastructure--there are
very few computers, of course.
We know that the infrastructure was formerly mostly
controlled by the military and the Government in power. The
Government controlled it and then whenever we took out their
communications systems we also took out the core of the
civilian systems also.
Right now about two-thirds of the 800,000 lines for the
hard-wired infrastructure are there in working order. They only
can talk to people in their local exchanges. There are hardly
any long distance calls at all that are not wireless.
So I am of the understanding that we cannot be very
successful in what we want to do over there unless we have got
a very, very strong communications system. That is part of the
building blocks, no matter what we do in agriculture. We know
that Iraqis have the ability to feed themselves. I mean, they
have some very good land. They have two great rivers that can
provide irrigation and they also have a soil base that is
probably as good as any in the Middle East. It is a lot better
than you'll find in Jordan and would compare to the strongest
of the Middle East countries. We know something of their
production.
I just want to make a point here to you, although I will be
talking to the people who are in charge. Once we start building
wireless systems and that need is probably immediate--the
systems should be interoperable; the systems should be the
newest of wireless technology that offers broadband access to
the world Internet. I feel there has not been a priority set on
the communications system in Iraq. In other words we not only
want to talk within Baghdad, but we want long distance from the
green line to Basra.
I would ask you to remind those that you help when they
come to you to request aid, that we take a good, strong look at
what we are building, at how fast we are building it, and at
the importance of the communications system. That will be the
overriding infrastructure other than ground transportation,
which is pretty well taken care of. We were pretty careful
about that.
But I really believe, Mr. Director, and this is most
important, there is no sense starting with an old technology.
We are trying to get away from them towards something that we
could apply that would give us high-speed and move a lot of
information very, very quickly.
As you have looked at that country, do you have any
thoughts on what is there and where we should be going?
Mr. Natsios. Senator, this is a very important question
because communications is a serious problem in Iraq right now
for us and for the NGO community, our contractors, U.N.
agencies, and for the ministries themselves. Many of them
cannot call the cities from the central ministries in Baghdad.
We are looking at the issue and we will be putting together a
set of recommendations very shortly which I think you will be
pleased with. I do not have anything to announce yet because we
are still researching the issue.
There is a provision within the Bechtel contract that was
written when we wrote it in January--it was not the Bechtel
contract; it was the work, the RFP that was bid--that calls for
reconstruction of the existing infrastructure. So there are two
questions here. One is the land lines, many of which are down
and need to be repaired. Bechtel will be doing that. That is in
their contract. There is money aside for doing it and they have
been ordered to do it. So that is already part of the plan.
The question is on the wireless part of this and that can
also be covered in the Bechtel contract. I am not sure that is
how we are going to do it. We have not looked through that
entirely at this point. But it is clear there is an issue. It
has been brought to our attention and we will be acting on it,
and we will get back to you about the details of that.
Senator Burns. I would certainly appreciate that. They have
hardly any fiber at all that carries their long distance wired
lines or trunks, even in the urban areas. So that is one of my
things. It applies not only to the way we do agriculture, but
it also does what you want to do. In addition, it plays a huge
role in education, for schools in remote areas, especially in
the use of wireless technologies for distance learning.
We have the technology to move fairly rapidly in the
rebuilding of our education infrastructure, which is what we
are going to do. So I appreciate your answer on that. I
appreciate your concern. I look forward to visiting with you on
some of those systems, because I take a very strong interest in
that. We come from a remote State, so we know how large a role
that communications plays in the economic development of our
States.
I thank the chairman. I do not serve on this particular
Appropriations subcommittee, but he did tell me that I could
make this little statement and I appreciate that very much.
Senator McConnell. Glad to have you here, Senator Burns.
Let me just mention, this hearing is going to end no later
than 3:30. It may end sooner, but we will leave the record open
for whatever questions any members want to add.
Let me take another round here, Mr. Natsios. Shifting to
the place the President just left--the Middle East--and the
road map between the Palestinians and the Israelis, how will
USAID be utilized to support the road map? What has USAID been
able to do there in the past, and how you are able to implement
and monitor programs, particularly on the Palestinian side, to
ensure that funds do not end up in the hands of those who are
engaged in homicide bombings?
Mr. Natsios. Thank you, Senator. We of course have a heavy
presence in the West Bank and Gaza, but since the second
intifada began we have altered our program and much of it now
is humanitarian assistance because we simply cannot continue
under these circumstances some of the programs, although I have
to tell you an interesting story. Two days before I was sworn
in as Administrator, I met the foreign minister of Israel at a
reception, Mr. Peres, in Washington. The first thing he said
before I could introduce myself was: I know you are Andrew
Natsios, you are about to be sworn in as the Administrator; do
not touch the water programs, please. I said: Yes, sir.
I met him later at a dinner in the evening. He said exactly
the same thing. He said: I know I said this to you once before.
Let me say it to you again: Do not touch the water programs. I
said: Yes, sir.
There is common interest in some things that cut across the
conflict and the acrimony and water is one of them because it
is so scarce. The water programs AID was running are these huge
water purification plants that will rationalize the water
system in the West Bank and Gaza. But, of course, they all get
their water from the same place Israel does, which is the
underground aquifers or from desalinization plants, which we
are also constructing I think one of in Gaza.
So to the extent that we have been allowed by the violence,
we have continued these important programs. We do not go
through the PA for any of the work we do. We do not transfer
any money. The one thing we are doing now----
Senator McConnell. It is 100 percent NGO, right?
Mr. Natsios. That is correct.
There is one project we are working on now, and this was at
the request of both the Israeli and the Palestinian Authority,
and that involves providing the PA finance ministry with modern
systems of accounting and accountability and auditing to ensure
in the future that they have the skill set to monitor how money
is spent by some of the ministries. We have a major
international accounting firm that is providing this training,
and it is connected to the whole question of revenues being
collected by the PA and by the Israeli Government.
So there was an agreement struck and AID is playing a role
in making--in implementing one of the few agreements that was
made prior to this past week. It was at a mundane level, but
both sides agreed to it, we were asked to do it, we have done
it, and it is working, I am told, quite well. It is capacity
building. There is no money changing hands in terms of being
moved, but there is a training program, a capacity building
program, which we believe will be very useful over the longer
term.
We are looking to the future and we have been asked to
begin gearing up for changes that will will unfold due to
advances in the peace process. We believe that the President
has begun a process that is going to be a success and AID needs
to be ready as soon as an agreement is reached to give legs to
the peace accords from our perspective.
We have a limited role in this, but we do have a role, and
we have to act quickly because the longer you wait the more
risk there is in terms of the peace settlement coming undone.
This happens in conflicts all over the world, where if we do
not act quickly following a peace settlement things
deteriorate.
Senator McConnell. So you are not expected to be asked to
do anything different; just more of the same and quicker?
Mr. Natsios. Well, we may be asked. There may be things in
the peace accord, Senator, that are different than they have
been in the past. So I do not want to presume what we will be
doing because it may be that they actually negotiate some of
these things.
Senator McConnell. Senator DeWine.
Mr. Natsios. I just want to say, I work for Colin Powell. I
go to the morning meeting every morning at 8:30, and this is an
issue of intense interest to him, Rich Armitage, my good
friend, and Secretary Grossman. And we do what they ask us to,
enthusiastically and energetically, and we will continue to do
that.
Senator McConnell. Well, I have a number of other questions
about various parts of the world, but I am going to restrain
myself. Let me end by telling you I ran into a young friend of
mine in the airport in Louisville on the way back to Washington
last Sunday. He was on his way to Bosnia. He works for the
World Bank, and he was extremely complimentary of your efforts,
the efforts of your agency in Bosnia. He was extremely
complimentary of the USAID effort and I thought that I would
pass that along to you because you probably do not hear as many
compliments as you do criticisms from Members of Congress.
Mr. Natsios. Senator, if you could get me his name so I can
take him out to dinner next time I visit Bosnia, I would
appreciate it.
Senator McConnell. I will do that.
We thank you very much for being here today and we will
look forward to drafting your budget for next year.
Mr. Natsios. Thank you, Senator, for your support. We do
appreciate it.
ADDITIONAL COMMITTEE QUESTIONS
Senator McConnell. There will be some additional questions
which will be submitted for your response in the record.
[The following questions were not asked at the hearing, but
were submitted to the Agency for response subsequent to the
hearing:]
Questions Submitted by Senator Mitch McConnell
OTHER DONORS IN AFGHANISTAN
Question. Have contributions from other donors kept pace with
needs? What have Middle Eastern countries provided?
Answer. Like the United States, a number of donors have disbursed
more than they pledged, including the United Kingdom, Japan, the
Netherlands, Denmark and Australia.
Contributions from the Middle East have been less generous and
slower in disbursement.
ACCOUNTABILITY OF ASSISTANCE IN AFGHANISTAN
Question. How is USAID ensuring that assistance to Afghanistan is
being used for the purposes intended? Are regular audits conducted?
Answer. Given the security strictures in place for U.S. Government
employees in Afghanistan, it is challenging for USAID staff to directly
monitor all of our programming.
In order to address this constraint, USAID has a Field Program
Manager, whose job it is to travel around the country with the U.S.
military for project monitoring and oversight.
USAID has also placed Field Program Officers in each Provincial
Reconstruction Team (PRT) to help with this critical function. On the
Kabul-Kandahar-Herat highway project, USAID has requested a concurrent
audit by our Inspector General.
In addition, our Inspector General (IG) is also monitoring USAID's
economic governance contract.
ELECTIONS IN AFGHANISTAN
Question. How can the international community ensure that the
elections are credible and reflect the will of the people--is more time
needed to prepare?
Answer. Successful implementation of the Bonn Agreement, including
the June 2004 elections, is a high priority for the USG.
We are working closely with the United Nations and other donors to
ensure that adequate funding is made available on a timely basis for
the elections process. Voter education and registration are immediate
priorities.
We are encouraging the establishment of an independent Afghan
electoral management body, the approval of an electoral law (through
the constitution or interim measures), and either a political party law
or regulations that permit an enabling environment for political
parties or movements to form, organize and participate in the election.
The USG is providing technical support for elections processes,
aiding the development of democratic political parties and coalitions
of reform-minded political parties and movements, as well assisting
civic/voter education.
Question. What is the international community doing to ensure a
stable and secure environment for the proposed polls?
Answer. Security is a serious concern for all activities related to
the elections process.
We are working with the Afghans, the United Nations and other
donors to determine how best to address security concerns leading up to
and immediately following elections.
WOMEN'S POLITICAL PARTICIPATION IN AFGHANISTAN
Question. What programs is USAID supporting to increase political
participation of women?
Answer. SAID believes the Afghan Ministry of Women's Affairs (MOWA)
provides a voice within the government to advocate for increased
political participation for women in Afghanistan and, accordingly, has
provided support for MOWA. USAID has also assisted NGOs working to
increase women's political participation.
Ministry of Women's Affairs.--This was the first Afghan Ministry to
receive USAID assistance. USAID assisted in the physical rehabilitation
of the Ministry of Women's Affairs (the auditorium and 11 offices) and
provided the Minister with a vehicle, office furniture and supplies,
two computers and a satellite phone. USAID's Gender Advisor provided
extensive assistance in helping the Ministry develop its first National
Development Budget recently. (Total activity funding: $178,718)
The NGO, Afghan Women's Network, is providing returnees with job
skills, including managerial training, and training women to
participate in the political process. (Total activity funding: $27,352)
The NGO, AINA, provided support to Afghan women filmmakers to make
a film on the experience of the Afghan woman during the Taliban period
and their hopes for the future. (Total activity funding: $97,110)
USAID is supporting the Constitutional, Human Rights and Judicial
Commissions to ensure that women's concerns are taken into account.
USAID is supporting a number of programs oriented at civil society
groups which will work to include women as well as minority groups into
the political process. In addition, there will be targeted NGO-
implemented programs working out of the women's centers which will
direct attention to this issue. USAID also supports to the Human Rights
Commission.
USAID, through the International Foundation for Election Systems
(IFES), is advising the Afghan Government and the United Nations on
needs for women's registration and voting.
USAID, and its partners, the International Republican Institute
(IRI) and National Democratic Institute (NDI), are ensuring that women
are recipients of education in the voter education process and
encouraging women to join political parties and movements, and for
parties and movements to include women.
IRAQ RECONSTRUCTION
Question. How do the ground realities in Iraq today differ from
your pre-conflict expectations and how does this impact budgeting--for
example, do fewer bridges need repair than originally anticipated?
Answer. War damage was less severe than anticipated, while the
extent of looting immediately post-conflict and the dilapidation of
existing infrastructure has been extensive. With respect to
infrastructure reconstruction, USAID, with guidance from the Coalition
Provisional Authority, has been prioritizing emergency communications
repair, power/electricity, and water and sanitation facilities.
Question. Are press reports on the slow pace of reconstruction
accurate? In addition to the security situation, what are the major
obstacles for reconstruction?
Answer. While the security situation poses challenges for
reconstruction efforts, the pace of USAID reconstruction activity is
consistent with and in some cases ahead of the pre-planning estimates
submitted to Congress in the April supplemental request. A fundamental
objective of all USAID support is to ensure Iraqi ownership of the
process and sustainability of efforts, but there is a fear among Iraqis
that Ba'athist elements could target them in retribution for their
reconstruction work.
Question. Are Ba'athist loyalists or Shi'a religious leaders
actively undermining reconstruction activities?
Answer. This question is most appropriately addressed to the
Department of Defense. However, USAID has productively-worked with
Shi'a religious leaders in delivery of essential services in the
southern regions and Baghdad.
EGYPT
Question. What is your assessment of USAID's democracy and
governance programs in Egypt?
Answer. The current democracy/governance (DG) program consists of
three activities: (1) the NGO service Center, which strengthens civil
society by providing direct grants, training and technical assistance
to NGOs aimed at improving their internal governance, financial
accountability, and advocacy skills; (2) the Administration of Justice
(AOJ) project, which modernizes commercial court administration and
expedites case processing through computerization, re-engineering, and
training of judges; and (3) the Collaboration for Community Services
project which, through locally or appointed entities in four pilot
communities, improves the delivery of public services.
Proposed new components include: (1) Promote the Rule of Law
through civil and criminal court reform and human rights activities
such as revitalization of the legal education in Egypt, English as a
second language training and support for NGOs that provide legal
services to poor and disadvantaged citizens; (2) Promote Reform of the
Egyptian Media by sending 50 journalists to the United States for
training; (3) Support to the Embassy's Public Affairs Section to put on
study tours to the United States and region to foster an enabling
environment for economic, education and social reforms; (4) Support the
Creation of an Independent Egyptian Council on Human Rights to ensure
the adherence to human rights by receiving and investigating complaints
and acting as a mediator, commenting on legislation involving human
rights and ensuring that Egypt adheres to international human rights
agreements; (5) Support the Egyptian Branch of Transparency
International to combat government and corporate corruption by
organizing citizen ``watchdog'' groups and, GOE cooperation permitting,
assisting the GOE in establishing a government-wide code of ethics; and
(6) Support Parliamentary 2005 Elections if GOE concurrence can be had.
Question. Can you point to any specific achievements of these
programs?
Answer. AOJ successes include: Case processing time has been
reduced from years to months; public confidence in the judiciary is
increased; the Ministry of Justice has demonstrated its commitment to
judicial reform through its massive investments ($50 million) for
upgrading courts and providing judicial training; and building
constituencies among judges, lawyers and court staff to support
judicial reform.
NGO Service Center successes include the promotion of political and
legal rights for women in Qena governorate where a local NGO received a
grant to assist 2,000 women obtain civil documents, and 1,200 women to
obtain electoral registration cards and access social insurance
benefits. More women have since petitioned local party official to
nominate increased numbers of women for positions on local councils and
to form a committee to promote women's awareness of their legal rights
to obtain available services from government agencies. Another example:
The village of Tablouha had long-suffered from poor environmental
conditions and disease due to lack of systems for solid waste and
garbage disposal. With USAID project assistance, a local NGO organized
a public hearing attended by 700 residents to discuss these needs. The
hearing resulted in two important decisions for the community: to use
both the Village Council's and an agricultural cooperative's clean-up
equipment to collect garbage and solid waste and to collect a monthly
fee from 550 local inhabitants to ensure sustainability of the service.
The fees have been used to purchase and plant over 1,000 trees in the
area.
CCLS: Two industrial communities that contribute significantly to
Egypt's exports have improved their community level services. An
employment services office and websites to promote the communities and
their industries have been created there. The city of Dumyat is a major
manufacturer and exporter of furniture. Manufacturers and small
workshops have expanded their market to the United States and Europe by
collaborating amongst themselves and with government to gain access to
services that will help them be more competitive by improving
marketing, designs, and quality control.
Question. What action is USAID undertaking to ensure that its
programs are not unduly influenced by the Egyptian Government?
Answer. USAID maintains dialogue with the GOE concerning democracy
and governance emphasizing: (1) USG commitment to significantly expand
funding in this area; (2) general themes around which we propose to
focus programming; (3) illustrative examples of the types of programs
we propose in each area; and (4) the need to rethink funding mechanisms
to reflect the changing nature of our assistance in this area. The USG
is also committed to reach more Egyptians at the grassroots level and
to implementing more activities through NGOs.
A U.S. inter-agency group agreed that USG projects should parallel
directly our policy approach to the GOE. For example, we should fund
projects that are consistent with the need to open political space for
new parties. The inter-agency group also agreed that the Embassy/USAID
should lay out the following themes and related indicative projects
with the GOE as primary areas of emphasis in democracy and governance
in Egypt: political openness; media and exposure to outside views;
civil society; and rule of law and governance.
BURMA
Question. How closely is USAID--and its contractor--coordinating
HIV/AIDS programs with Suu Kyi?
Answer. USAID's HIV/AIDS program was designed in close coordination
with the U.S. Embassy in Rangoon. When the program was designed USAID
met with representatives of the National League for Democracy (NLD) and
other democratic opposition groups. Comments and suggestions from the
groups were incorporated into the program design. The representative
visited one of the project sites and liked the work that was being
implemented. USAID continues to work closely with the U.S. Embassy and
to seek NLD guidance on the program.
Question. Given Burma's repressive environment, how does USAID
ensure oversight of the use of funds inside Burma?
Answer. USAID-managed programs inside Burma are currently limited
to: (1) activities that enhance the ability of the American Center in
Rangoon, within the U.S. Embassy, to reach out and provide some
training and materials on democracy and human rights issues to members
of Burmese democratic organizations; and (2) HIV/AIDS prevention and
treatment. Activities to reach out to democratic opposition groups are
carried out under the supervision of the U.S. Public Affairs Office in
the Embassy. HIV/AIDS activities are implemented by organizations with
whom USAID has worked for many years. These organizations have
developed, and discussed with USAID, monitoring plans that ensure
adequate oversight of their programs. In addition, USAID has made
periodic site visits to monitor program activities. USAID has recently
opened a Regional Development Mission in Bangkok to better manage and
oversee activities in the region.
Question. As the generals in Rangoon do not let foreign NGO workers
travel unaccompanied throughout the country, how do these NGOs ensure
oversight of their programs?
Answer. USAID's experience from site visits to HIV/AIDS programs
inside Burma has been that in many areas NGO's have relative freedom of
movement and are not subject to government interference in their
programs. USAID-funded NGO's have consistently reported that they are
able to work with relative ease in many areas of Burma. Conditions vary
greatly within Burma, and NGO's with whom we work choose areas where
adequate program oversight is possible.
CAMBODIA
Question. With parliamentary elections scheduled for July 2003, how
confident are you that the elections will be free and fair?
Answer. We feel that this will be difficult to judge at the present
moment. While we are confident that the Cambodian people would really
like to have a free and fair election it is really too early for them
to tell at this point--and thus it is difficult for us to know as well.
The elections will be determined to be free and fair IF the Cambodians
feel that the process was valid and that the results indicate what was
actually voted. In truth, this will not be determined until several
days after the polls close--we therefore hope Washington is wary of any
reports immediately after the election.
Question. Would USAID support increased assistance to Cambodia if
the repressive Cambodian People's Party (CPP) was no longer the ruling
party?
Answer. We would welcome increased assistance as Cambodia has
enormous needs and the Cambodian people could benefit greatly from
increased assistance in areas such as education, health, democratic
development, economic growth and employment, environment, and anti-
trafficking in persons.
SECURITY AND ELECTIONS IN CAMBODIA
Question. Cambodia is a case study of the long term development
challenges that arise when substandard elections are held after years
of turmoil. How do you assess the current security environment in
Afghanistan, and how might security impact the 2004 elections?
Answer. Election security is a serious concern that could impede
the conduct of free and fair elections.
If not adequately addressed, regional populations may be inhibited
from organizing into parties or movements, campaigning, attempting to
register and voting their conscience. We are working with the Afghans,
the United Nations and other donors to determine how best to address
security issues.
INDONESIA
Question. What specific programs are being supported to counter
extremist influence throughout the country?
Answer. USAID's support for moderate groups long predates 9/11;
USAID programs have provided support to moderate groups responding to
emerging social issues, voter education including the 1999 election
process, and women Muslim groups. Since 9/11, USAID programs to counter
extremism in Indonesia have expanded and include work on promoting
religious tolerance through the Islam and Civil Society Program, on
strengthening local government management of education so that public
schools can become better alternatives to private religious-based
schools, and on helping Indonesia to establish a legal and policy
environment that disrupts material support for terrorists. The three
current programs USAID supports are:
1. Islam and Civil Society Program (ICS)
Implementer: The Asia Foundation (with 30 Muslim Partner
Organizations)
Timeframe: 1997 to 2004
Funding to date:$4,900,000
--The ICS supports the efforts of 30 moderate Muslim organizations to
directly counter religious extremism and promote
democratization through Islamic teachings and texts in four
main areas: gender, media, education policy and political
parties.
--Moderate Muslim groups supported by this program have played an
increasingly public and vocal role in calling for tolerance and
peace during critical periods of time such as the recent
military action in Iraq.
--Education programs are based upon the premise that Islamic
militancy thrives on lack of knowledge and understanding of how
Islamic principles support democracy, tolerance, gender
equality, pluralism, and rule of law. Education on these
principles and on tenets of secular democracy and civil society
is an effective tool in preventing/countering militancy.
--ICS education programs work through two main channels--formal
institutions of higher education, and informal programs
conducted in pesantren (Islamic boarding schools) or campus
groups. ICS-supported media programs are directly aimed at
countering visibility of militant Islam within the public
media.
Program examples and results include:
--New civic education curricula focused on the rule of law, citizen
rights and gender equality are now being implemented in 47
affiliates of the Islamic National University, Jakarta and in
six University of Muhammadiya, Yogyakarta universities (to be
expanded to all 35 in September 2003). 40,000 students a year
take this required course.
--The Institute for Research and Pesantren Development, Makassar has
developed a civic education curriculum and textbook countering
rigid Islamic doctrines that marginalize women and restrict
religious pluralism, to be piloted in 24 pesantren in South
Sulawesi, then integrated into all 2,000 affiliated pesantren
in South Sulawesi.
--Islam Liberal Network, Jakarta explicitly aims to counter militant
and radical Islamic movements in Indonesia. They produce a
weekly radio talk show on pluralism and tolerance that reaches
10 million listeners through a network of 40 radio stations
nation-wide, and publish a weekly half-page column in the daily
newspaper Jawa Pos and 35 syndicated affiliates, reaching 2
million readers with messages of anti-violence, pluralism and
religious tolerance. They also maintain a bi-lingual website
that actively campaigns against militancy
--Islamic Education Laboratory, Yogyakarta, a university student
group, facilitates routine campus discussions on ``Islam and
pluralism'' and civil society building projects among campus
groups on six prominent universities in Central and East Java,
bringing its message of pluralism and tolerance within Islam
directly to target hardline student populations.
--Study-Action Group on Indonesian Democracy/Institute for Human
Resources Development, Jakarta--these two organizations both
work directly with khotib (Mosque preachers) and mosque youth
groups to promote messages of pluralism and tolerance. One
produces a bulletin handed out by mosque youth groups to
worshippers after Friday prayers. The other trains Khotib, who
preach at the Friday prayers, and provides them with a
``preachers' handbook'' of ``sermons'' on rule of law, civil
society, and religious tolerance.
--Paramadina University, Jakarta, has created a handbook entitled
``Islamic Jurisprudence on Pluralism'' for Muslim leaders that
references classical and modern Islamic texts and jurisprudence
that support pluralism, religious tolerance, and gender
equality.
--Institute for Advocacy and Education of Citizens, Makassar, a
grassroots student group, broadcasts an hour-long interactive
talk show on five radio stations with a listenership of 1.2
million people in South Sulawesi.
--Syir'ah, Jakarta is a monthly magazine explicitly designed to
counter the top-selling Islamic militant magazine Sabili.
Syir'ah has the same size, format, cover design, and
distribution pattern as Sabili--but a different content.
Instead of promoting violence and radicalism, it preaches
tolerance, anti-violence, gender equality, and religious
pluralism.
2. Economic Law, Institutional and Professional Strengthening (ELIPS)
II Program
Implementer: Nathan-MSI Group
Timeframe: 2001 to 2004
Funding to date: $8,400,000
The ELIPS II provides institutional-building support to strengthen
independent regulatory commissions, the Ministry of Justice, law
schools and professional associations, and to provide technical
assistance in drafting, promoting, passing, understanding, and
implementing laws, decrees, administrative orders and decisions related
to financial crimes. Key results to date:
--ELIPS II assisted the GOI in drafting and passing the new Anti-
Money Laundering Law enacted in late 2002. Follow-up work
includes drafting of implementing regulations and key
amendments related to FATF compliance. Additional work is
assisting the newly formed Financial Intelligence Unit and
addressing cyber crimes. These activities are complemented
technical assistance being provided through the Financial
Services Volunteer Corps focusing on exposure to the U.S. anti-
money laundering system.
--ELIPS II also provided extensive input to the draft Anti-Terrorism
law including co-sponsoring a major conference on the Economic
Impact of Terrorism.
--ELIPS II has completed a study and plan for initiatives in
financial crimes and completed needs assessments for financial
crime unit at the Attorney General's office.
3. Managing Basic Education
Implementer: Research Triangle Institute
Timeframe: 2003-2005
Budget to date: $3,000,000
This program aims to improve the efficiency and effectiveness of
local government on strategic planning, administrative management,
finance and budgeting to provide better quality basic education
services in the context of decentralization, and helping to make public
schools more viable alternatives to religious based private schools. In
addition, the program strives to increase community involvement in
local government decision-making on education. The program will work
with 9 local governments on a pilot basis.
Question. How can education programs effectively counter the
influence of Muslim extremist schools in Indonesia, given the country's
vast geography and USAID's relatively limited resources?
Answer. A majority of Indonesian public and private schools are
considered moderate and do not fall in the category of extremist or
radical extremist schools. Indonesia is a very large country with many
ethnic and cultural groups. To effectively counter the influence of
Muslim extremist schools across Indonesia, a multi-faced approach needs
to be pursued to address extremism, which includes building on our
decentralized local government program and broadening local
government's capacity and capability to increase community and local
government decision-making on education. Also, the number of extremist
schools which do not offer the national approved curriculum
incorporating secular subjects should be encouraged to do so. Other
elements within the multi-faced approach are described below.
--Better understanding of Indonesia's educational system which
includes better monitoring of the education sector by
government, community groups, and NGOs concerning curriculum,
text books, and quality that builds on the strengths and ideals
of indigenous groups; greater involvement of parents and
community leaders in local school programs, textbooks, and
administration; teacher training and adequate incentives and
rewards for teachers; exchange programs which broaden teacher
and students views and their understanding of different
cultures and value systems which respect universal human values
of dignity, compassion, and tolerance; and strengthening civic
education in public and religious schools.
--Promoting Tolerance and Compassion.--Combating terrorism and the
extremist ideas that fuel it is especially difficult because of
an education system that fails to include liberal democratic
values and religious tolerance in public and religious schools.
While not a silver bullet, improving the Indonesian education
system is a critical tool for advancing the war against
terrorism in the long-term and serves as an avenue for helping
reduce the potential sway of radical fundamentalism and
intolerance.
--In a tough economic situation, Indonesian families are turning to
low-cost, but not necessarily better quality, educational
alternatives such as Islamic madrasahs and pesantren. Most
teach the national secular curriculum, but some focus only on
religious studies, sometimes with fundamentalist and anti-
American themes sympathetic to terrorists. Expanding economic
opportunities for at risk-groups is critical to broadening
their access to quality public and moderate religious schools.
--Expanding students access to alternative views.--The appeal of
extremism can be reduced by expanding the access of Muslim
students to democratic systems and values, and alternative
worldviews. The key mechanisms for assuring access to more
diverse and balanced points of view are increased enrollment
and retention of students in higher quality government-managed
public schools, and support to moderate religious schools,
focusing on civic education and promotion of democratic values.
By making public schools a more effective, accessible and
viable alternative to religious schools, we can reduce the
exposure of Indonesian students to extremist views.
--Strengthening the Quality of Secular Education Provided in Muslim
Schools. The quality and relevance of secular education in
Muslim schools is often poor. In most cases, the quality
problems are even more acute than those found in public schools
because Islamic school teachers are usually not academically
equipped to teach secular subjects. To help create a more
favorable learning environment in classrooms, teachers should
be introduced to ``modern'' pedagogical methods that are
participatory and student-centered. Also, the curricula should
promote activity-based learning, including apprenticeships and
on-the-job-training to better facilitate the absorption of
Islamic school students into the job market once they compete
school.
--Engaging Islamic School Leaders to Participate in Providing
Education to all Learners. Local government and community
leaders should be encouraged to take a more proactive and
positive approach to becoming more engaged with public and
moderate Muslim school leaders to discuss how they can better
cooperate and work together to reach all learners and broaden
the process for a shared vision of quality and relevant
education for all and guard against the proliferation of
extremist elements in Muslim schools.
PAKISTAN
Question. The North West Frontier Province in Pakistan recently
implemented sharia--Islamic--law. The Taliban provided a vivid insight
into the repression of freedom that occurs under sharia.
What programs is USAID conducting in this province, and what
programs can we conduct to protect and enhance the rights of women and
freedom of speech and thought?
Answer. USAID's programs are helping improve the quality of life
for Pakistani girls and women, through greater education, health care
and economic opportunities. In our Democracy and Governance program we
have a legislative orientation activity that has provided training to
new legislators of which 30 percent are women. In the Federally-
Administered Tribal Areas (FATA) bordering Afghanistan, USAID supports
120 schools where we plan to repair and provide desks, chairs, and
blackboards. When parents believe girls are receiving quality
education, they are much more likely to allow girls to remain in
school. Additionally, in our Education program we are engaged in early
education teacher training which includes women teachers. This helps to
reduce the disparity between professional development for women and
men. The program also helps teachers and administrators build stronger
and more balanced curricula, addressing the needs of both boy and girl
students. In our Economic Growth program, we are designing micro credit
activities that specifically target women-owned and run businesses in
some of the most impoverished regions of the country. In addition
economic growth activities include a merit-based scholarship fund for
needy students, especially women who would not otherwise have access to
higher education, to attend established business schools. Finally, the
Mission's Health program is designed to improve the overall quality of
healthcare and to specifically address the needs of women.
Question. What steps are we taking to ensure the financial
integrity of assistance provided to Pakistan?
Answer. USAID's Controller, a U.S. Foreign Service Officer, arrived
at post in December 2002. He leads the USAID team to monitor the
program for financial and programmatic integrity. In addition to these
regular monitoring plans, USAID sent out a request for proposal from
seven accredited Pakistani firms to undertake the following: (a)
Financial pre-award surveys and periodic financial reviews of NGOs and
other partners; and (b) Performance monitoring of the program in each
province to measure the progress and maintain a check on the
implementation of USAID's programs in the field. The Office of
Inspector General (OIG) of USAID in Manila has determined that each of
the seven Pakistani firms meets rigid U.S. standards for auditing and
monitoring programs. In addition, later this year the OIG in Manila is
planning a training session in USG accounting/auditing standards for
all accounting firms including cognizant personnel from recipients and
the Auditor General's Office of Pakistan.
Question. How many Afghan refugees remain in Pakistan?
Answer. While the drought has ended and many Afghans have returned
to Afghanistan, some 235,000 refugees continue to reside in sixteen
Pakistani camps. The camps are located in remote and harsh frontier
areas where the refugees have little access to food and sources of
income. Food assistance is crucial to their survival. The U.S.
Government, through Public Law 480, Title II, will provide 2,070 MT of
commodities in fiscal year 2003 to meet the needs of 235,000 refugees.
U.S. assistance consists of 970 MT of vegetable oil and 1,100 MT of
lentils. The estimated cost of the U.S. contribution is $2,036,200
including the cost of commodity, ocean freight, and internal transport,
storage and handling.
ENVIRONMENTAL HEALTH IN ASIA
Question. While SARS has captured the attention of the world's
media, there are other serious health issues in southwestern China, and
Tibet, where millions suffer from environmental health problems related
to heavy metals in domestically used coal and severe water quality
problems. These include arsenic and mercury poisoning and fluorosis.
The region is characterized by a karst topography, which is exceedingly
vulnerable to groundwater contamination. These environmental health
problems particularly strike children, condemning them to lives of
chronic disease. This in turn affects the economic growth and vitality
of the region.
There are relatively simple, cost-effective solutions to these
problems. Western Kentucky University, in concert with other
institutions, has established a consortium of geoscience, biomedical
and public health researchers from the United States and China. By
studying and implementing solutions to these environmental health
problems, the consortium will serve as an example and as a resource for
what can be accomplished elsewhere in China and in other developing
countries. Will your Agency work with this Consortium to implement
solutions to these environmental health problems and save the rising
generation of Chinese children from lives of disfigurement and disease
and also remove the health impediments to economic growth?
Answer. USAID follows the policy guidance of the Department of
State on all proposed activities in China. USAID implements a Regional
HIV/AIDS program with NGO's in southern China, and manages, at the
direction of the State Department and the Congress, limited activities
on the Tibetan Plateau and a rule-of-law grant to Temple University.
Generally, USAID's environmental health activities focus on infectious
diseases, especially the prevention of diarrhea disease and pneumonia
in children, as well as malaria. USAID has chosen to focus its limited
resources in these areas because the public health threat in terms of
both child mortality and the overall disease burden in these areas are
greatest and because there are proven and effective interventions. In a
very few countries USAID has addressed specific problems of chemical
contamination in the environment, such as lead exposure in children and
arsenic contamination of drinking water. Within the existing legal and
policy framework that guides and directs USAID's involvement in China,
we would, of course, give full and complete consideration to such a
proposal.
FISCAL YEAR 2004 USAID BUDGET REQUEST FOR RUSSIA
Question. The fiscal year 2004 budget request for Russia is $75
million below the last year's level. While some of this decrease can be
attributed to the transfer of exchange programs to the Department of
State Bureau of Educational and Cultural Affairs, what programs or
activities will USAID cut in the ``graduation process''?
Answer. You are correct that $30 million of the $75 million
decrease is due to the transfer of exchange programs to the Department
of State Bureau of Education and Cultural Affairs. These important
exchange programs with Russia will continue to be funded.
The anticipated reduction in FREEDOM Support Act funding in 2004,
and its implications for future funding, will force USAID, in
consultation with the Assistance Coordinator's Office in the State
Department, to make difficult decisions among important activities.
During the phase-out period, we will likely continue to focus on
the sustainability of civil society institutions across all sectors
that will be instrumental in continuing to push for reforms and for
building a democratic society in Russia. We will probably also continue
to emphasize our programmatic emphasis on Russia's critical health
problems--particularly HIV/AIDS, tuberculosis, and unhealthy
lifestyles. In addition, given the resources and development potential
of the Russian Far East, as well as its cultural and historic ties to
the United States, we anticipate continuing to emphasize programs in
this region. In view of the economic progress Russia has made, most of
the proposed budget cuts will likely be borne by our economic growth
programs; some are slated for early termination and others will likely
be curtailed entirely. In some cases, those cuts are being made in 2003
to ensure that we have the resources for other priority areas in 2004.
Question. How will democracy programs be impacted by the decrease
in assistance for Russia?
Answer. We recognize that Russia's transition, particularly toward
democracy, may well not be complete by 2008, and that as FREEDOM
Support Act programs end, the U.S. Government must nevertheless remain
to stay engaged in Russia's transition. It is our understanding that
other USG agencies plan to continue to support civil society
development and democracy via National Endowment for Democracy, Embassy
Democracy Commission, United States-Russian citizen contacts, and
professional and student exchanges.
We realize that Russia continues to face challenges in democratic
development. We are developing a strategy to phase out FSA assistance
to Russia over the next several years that will seek to ensure a legacy
of sustainable institutions to support civil society and democratic
institutions. During this time, we will increasingly focus on democracy
and rule of law to ensure that we consolidate and sustain the progress
made over the past decade. We will seek to advance structural changes
that are needed to create a hospitable environment for Russian civil
society.
FSA technical assistance programs have played a vital role in
advancing progress toward rule of law in Russia, including vital
support for the professionalization of Russian court administration and
judicial training; emphasis upon the importance of judicial ethics
(resulting in more openness by the Russian courts concerning
disciplining of judges); reform of law school curriculum, including
introducing and supporting clinical legal education; and supporting
every aspect of the development of the new criminal procedure code,
which has drastically changed the roles for Russian judges, prosecutors
and defense attorneys. As another example, legal volunteers from
Vermont, including judges, practicing attorneys, and staff of Vermont
Law School, have worked with the Republic of Karelia on a professional
development program for Karelian judges, legal educators, and
practicing lawyers. Our focus is now on helping the Russian bar
consolidate the gains it has made, particularly by sponsoring
professional education events to help the bar hone its advocacy skills.
FISCAL YEAR 2004 USAID BUDGET REQUEST FOR ARMENIA
Question. The fiscal year 2004 budget request for Armenia is $40.5
million below last year's level. Is this cut too drastic, and what
programs will you terminate should Congress provide the budget request?
Answer. While a reduction in FREEDOM Support Act (FSA) funding in
fiscal year 2004 would reduce the scope of USAID programs, USAID does
not believe that such a reduction would be detrimental to the progress
and momentum in reform that it has achieved in its efforts to date.
USAID/Armenia conducted an initial analysis on what a reduced FSA
budget would do to its programming. Armenia has made progress in
certain areas over the past few years, and we are able to wind down
successful programs. For example, some of our micro-credit programs are
now self-sustaining, our energy metering program has been successfully
completed, and the Earthquake Zone Recovery program will end in fall
2004. While we would not eliminate any of our major program areas, as
described in more detail below, we would have to phase out and/or scale
down certain programs.
USAID/Armenia has an integrated strategy to assist in economic and
political transition to a law-based market economy and an open,
pluralistic democracy. The strategy also anticipates support to lessen
the distress of Armenia's transition. With reduced funding levels, the
Mission would continue its integrated approach, but would reduce the
scope of activity in each of its program areas. Anticipated activities
are grouped into five broad areas: A more competitive private sector
(economic reform), improved democratic governance (governance),
improved primary healthcare (healthcare reform), improved social
protection (social protection), and more efficient and environmentally
sound management of energy and water resources (energy and water). If
funding is reduced, USAID/Armenia, in collaboration with partners and
stakeholders, would focus on a more limited set of key objectives in
each of these areas.
Economic reform, with a focus on micro, small and medium enterprise
development and job creation, remains a primary focus areas of the
Mission portfolio because it is viewed as a major driving force in
Armenia's advancement toward economic growth, equity, and political
stability. The Mission intends to shift its emphasis toward
strengthening institutions that implement commercial laws and policies
in order to create a legal and regulatory environment that will
encourage greater foreign direct investment. At a reduced funding
level, technical assistance to micro, small, and medium enterprises in
the sectors would be focused on sectors with the greatest growth and
employment potential.
Work in democracy and governance continues to be a high priority
for the Mission, addressing three interlinked problems: dominance of
the executive branch, a lack of democratic political culture, and
corruption. USAID programs support strengthening citizen participation,
non-governmental organizations, non-state media, local governance,
anti-corruption, legislative strengthening, and rule of law. Citizens
have demonstrated greater interest in community issues, and USAID plans
to continue its efforts fostering this developing sense of community
ownership and responsibility. Projects that encourage citizens to
participate in public issues cover a variety of issues ranging from
condominiums, police, human rights, the Constitution, local government
and elections. These activities stimulate the ``demand side'' for
improved democratic process. The ``supply-side'' for improved
democratic governance is achieved through strengthening governance
institutions to make them more effective, transparent, and accountable
to citizens. To promote democratic governance, funding at a reduced
level would require limiting the focus to three or four of these seven
areas, with priorities being to strengthen the demand for better
governance and anti-corruption.
In healthcare reform, efforts address transition from the Soviet-
legacy system for the provision and administration of healthcare.
Programs target financial reform, institution building, training,
enhanced transparency, community mobilization, health education,
medical outreach, and nutrition. With reduced funding, there would be
fewer United States-Armenia partnerships; a decreased effort to
strengthen primary care, reproductive health and system reform; and
smaller-scale direct assistance programs. Efforts would continue in
financial reform, which is essential to develop a system in which
patients are allowed to choose care providers. Financial reform must be
accompanied by training to shift care provision from highly-
specialized, hospital based system to preventive, primary care. The
pace of healthcare reform would slow down with reduced funding in this
area.
Social protection programs serve a humanitarian purpose and build
popular support for market and democratic reforms. With the existing
levels of poverty, unemployment and other forms of vulnerability,
social protection remains a priority for USG assistance in Armenia.
USAID/Armenia will support a new vocational training program partnered
with targeted labor development programs, as well as strengthening core
assistance programs, including pensions for the elderly and poverty
family benefits. At a lower funding level, our assistance in the social
insurance system aimed at the improving pension and disability support
and payment systems would decrease, as would the proposed skills
training and labor development programs. Fewer vulnerable populations,
such as the aging, will be assisted.
The Mission's energy and water sector activities will promote more
efficient and environmentally responsible development of these key
public services. Improving the performance of the institutions that
manage and regulate water and energy will improve the delivery of heat
and water services and increase Armenia's energy security. USAID's
support is aimed at promoting sustainable energy and water management,
enhanced economic growth and competitiveness, reduced negative
environmental impacts, energy security, and improvement to the quality
of life of Armenians by supporting improved delivery of water and heat
supply. At a reduced funding level, these goals will be harder to
achieve due to their complexity and the length of time required.
However, because the Mission's plans to focus on institution building,
policy development, and pilot projects where other donors will make the
major infrastructure investments, key objectives can be achieved at the
reduced funding level, with careful attention to focus, planning and
implementation.
Question. Armenia's presidential elections in February 2003 were
mired in controversy. How is USAID bolstering democracy in that
country, and should more programming be done?
Answer. By all accounts, the conduct of the recent presidential
election in Armenia was controversial. It highlighted the strong
tendency toward executive branch domination. Consequently, multiple
efforts in democracy and governance continue to be a high priority for
the Mission. These efforts address three interlinked problems:
dominance of the legislative and judicial branches of government by the
executive branch, a lack of democratic political culture, and
corruption. USAID programs support greater citizen participation, an
expanded role for non-governmental organizations, improved news
coverage by non-state media, stronger local governance, targeted anti-
corruption activities, legislative strengthening of the National
Assembly, and increased dependence on the rule of law. Armenian
citizens continue to demonstrate great interest in community issues. As
such, USAID plans to continue its efforts to foster this nascent sense
of community ownership and responsibility. Projects that encourage
citizens to participate in public issues cover a variety of issues
ranging from condominiums, human rights, the Constitution, local
government and elections. These activities stimulate the ``demand
side'' for improved democratic processes. An improved ``supply-side''
for improved democratic governance is achieved through strengthening
governance institutions to make them more effective, transparent, and
accountable to citizens.
USAID SUPPORT FOR THE COOPERATIVE DEVELOPMENT PROGRAM
Question. Israel.--Is USAID considering reinstating support for the
Cooperative Development Program?
Answer. The Cooperative Development Program (CDP), a centrally-
funded USAID program that has enabled MASHAV, the development
assistance arm of the Government of Israel's Ministry of Foreign
Affairs, to develop collaborative relationships with developing
countries around the world, is receiving its last tranche of central
funding in fiscal year 2003. This program, which has involved
commitments of nearly $75 million since the late 1980s, was felt to
have fully accomplished its goals.
In fiscal year 2001, MASHAV and USAID initiated a new partnership
that emphasizes relationships between our two organizations at the
country level. Individual USAID Missions are encouraged to consider
collaborating with MASHAV on projects in which Israeli expertise is
deemed to be appropriate. The USAID Mission in the Central Asian
Republics has been the first to enter into such a partnership. It will
continue to utilize Israeli expertise directly through a Mission-funded
$5 million agreement with MASHAV, which runs until the end of fiscal
year 2005.
RURAL ELECTRIFICATION
Question. What funding level does USAID anticipate providing for
international rural electrification in fiscal year 2004, and what is
USAID's commitment to these programs?
Answer. Globally, USAID anticipates providing approximately
$35,500,000 in fiscal year 2004 for rural electrification. This number
represents a wide range of technical assistance, capacity building, and
policy and regulatory work that facilitates increasing access to
electricity in rural areas. This total is at this time provisional as
actual figures will depend on appropriation numbers and final
determination of field programs based on field mission strategies and
current needs. USAID is fully committed to this issue through the
Global Village Energy Partnership (GVEP), a program under the White
House Signature Clean Energy Initiative (CEI). The CEI aims to provide
millions of people in the developing world with access to affordable,
reliable, clean, healthy, and efficient energy services. USAID is the
appointed USG Agency to lead up the GVEP which seeks to reduce poverty
and promote sustainable development through increased access to modern
and affordable energy services in areas either not served or under-
served by current energy delivery systems. The Partnership brings
together developing and industrialized country governments, public and
private organizations, multilateral institutions, consumers and others
in an effort to ensure access to modern energy services by the poor and
aims to help reduce poverty and enhance economic and social development
for millions around the world. It builds on existing experience and
adds value to the work of its individual partners. It reaches out to
non-energy organizations in the health, education, agriculture,
transport and enterprise sectors, and offers a range of technology
solutions to meet their needs. This covers renewable energy, energy
efficiency, modern biomass, liquefied petroleum gas (LPG) and cleaner
fossil fuels. The Partnership will help achieve the internationally
recognized Millennium Development Goals. The partnership will also
address gender issues in order to reduce health and environmental
hazards and increase social and economic welfare; it will build on the
knowledge and capacity of each member of the community in energy
delivery and use.
______
Questions Submitted by Senator Arlen Specter
U.S. COMPANIES AND USAID PRIME CONTRACTORS
Question. How best can prime contractors utilize U.S. companies as
suppliers in reconstruction efforts--is this something that can be
written, or amended, into contracts?
Answer. USAID policy is to buy American products as often as
possible. However, where American equipment cannot be maintained or
repaired, USAID documents the reasons why the purchase of U.S. products
was not feasible. USAID cannot direct its prime contractors in terms of
what subcontractors to use. However, in order to facilitate procurement
opportunities for interested companies, USAID has established an
extensive website containing detailed information on our Iraq
reconstruction activities and direct links to our prime contractors.
USAID CONTRACT PROCESS
Question. Mr. Administrator, I have been recently contacted by Dick
Corporation of Pittsburgh, Pennsylvania, a company that is interested
in assisting in the reconstruction of Iraq. Dick Corporation is a major
contractor that provides quality construction services to the Army
Corps of Engineers, the Navy, and the General Services Administration.
In serving all of these clients, the company has been a recipient of
numerous awards for performance excellence. Currently, Dick Corporation
is rated by Engineering News Record as 36th in the listing of the Top
400 Contractors and 22nd of the Top 50 Contractors working abroad. What
is the process Dick Corporation should go through to work with AID in
obtaining construction contracts? Has AID issued any similar
construction contracts in the effort to rebuild Iraq?
Answer. USAID encourages firms with demonstrated expertise in
particular sectors to contact USAID's prime contractors. USAID posts
the names of the prime contractors on the USAID website as contracts
are awarded. Given that the prime contractor is legally bound to the
parameters of the contract, the prime must determine the most
technically appropriate and cost-effective sub-contractor relationships
to meet the deliverables within the contract. USAID's capital
construction requirements are being implemented by Bechtel National,
Inc., with technical oversight provided by the Army Corps of Engineers.
______
Question Submitted by Senator Judd Gregg
PEREGRINE FUND
Question. What is the status of USAID's funding for The Peregrine
Fund's (TPF's) Neotropical Raptor Conservation Program in Panama?
Answer. USAID has provided funding of $1,000,000 to the Peregrine
Fund ($500,000 each in 2001 and 2002) and will provide $500,000 in
2003. Management of the grant is being transferred this year from the
Washington based Regional Sustainable Development Office to the USAID
mission in Panama.
______
Questions Submitted by Senator Robert F. Bennett
ACCOMPLISHMENTS IN AFGHANISTAN
Question. What are some of the accomplishments we can point to in
Afghanistan?
Answer. Below we provide USAID accomplishments organized by sector:
Humanitarian (following 24 years of conflict and 4 years of
drought):
--Averted famine for between 8-10 million Afghans in 2001-2002.
--Ensured that 5.9 million Afghans were able to survive the winter of
2002-2003 by prepositioning food aid and providing emergency
shelter kits.
--Kept the major north-south artery (Salang Tunnel) open
--Provided opportunities for thousands of Afghans to regain their
dignity and a measure of livelihood security through the
implementation of dozens of cash-for-work programs
Revitalizing Agriculture and other Livelihood Options (70 percent
of Afghans dependent on agriculture for their income):
--Provided 3,500 MT of seeds and 3,100 MT of fertilizers for the
spring 2002 planting season that produced 100,000 MT of wheat
benefiting 60,000 farmers. These inputs helped to contribute to
an 82 percent increase in production from the previous year and
contributed to a decrease in the number of Afghans who will
need food aid this year.
--In fall 2002, 5,000 MT of seed and 9,000 MT of fertilizer were
distributed to 113,000 farmers in 13 provinces. Estimated
increase in wheat crop production from this contribution is
42,000 MT, which translates into an additional $69 net income
per farmer. (Note: There is no data on average annual income in
Afghanistan. However, other countries with comparable social
indicators have annual average incomes between $100-$200 per
year.) FAO's crop forecast produced just prior to harvest in
summer 2003 indicates that the harvest could be, ``the best
harvest in 25 years'' and a 60 percent increase over 2002. The
report indicates that good rainfall, additional land in
production, and widespread availability of seed and fertilizer
account for the increase. If actual harvests are as good as the
pre-harvest survey predicts, Afghanistan could realize a
national surplus in cereals, particularly wheat, in 2003.
--In spring 2003, 227 MT of seed and 339 MT of fertilizer were
distributed to 4,500 farmers in three provinces. This
distribution focused on increasing seed production for improved
varieties of a wider range of crops, rather than just cereals
as had been the focus in spring 2002 and fall 2002.
--Repaired over 5,000 km of rural roads through cash-for-work;
carried out 250 projects related to road infrastructure
(culverts, retaining walls, etc.); reconstructed 31 bridges.
--Carried out 5,245 small agricultural water infrastructure projects
(irrigation canals, small dams, levees, etc.)
--Repaired and managed the traffic control system for the Salang
Pass, the major north-south route for Afghanistan.
--Provided over 11,000,000 person-days of cash-for-work jobs; the
equivalent of 1 month of employment for half a million Afghans.
Upcoming Accomplishments:
--$150 million three year Rebuilding Afghanistan's Agricultural
Markets Project (RAMP), awarded July 2003, will include major
sub-programs in rural agricultural infrastructure, rural
financial services, and technology improvement and market
development.
Kabul-Kandahar Highway Reconstruction:
--Rebuilding 390 km of 482 km Kabul-Kandahar highway; successfully
met mobilization and implementation challenges presented by
President Bush's direction to accelerate reconstruction for
first layer asphalt completion by December 31, 2003. Paving
initiated July 1, 2003; five separate construction
subcontractors now mobilized and working five road segments.
Enhancing Educational Opportunities:
--Provided 15 million textbooks for the start of school in 2002 and
10.7 million in 2003.
--Provided 4,000 basic teacher training kits.
--Providing, since March 2002, a food salary supplement, equal to 26
percent of income, to 50,000 teachers.
--Rehabilitated 142 schools, daycare centers, vocational schools, and
teacher training colleges.
Upcoming Accomplishments:
--Start accelerated learning programs for upwards of 60,000 girls who
missed education under the Taliban.
--Provide emergency training for 30,000 community-selected teachers.
--Rebuild 1,000 schools over 3 years.
Improving Health, particularly Maternal/Child Health (Second
highest maternal mortality rate in the world; one in four children die
by the age of five):
--Immunized 4.26 million children against measles.
--Provided one-quarter of the Kabul water supply, focusing on the
poorest districts.
--Carried out 3,114 small potable water supply projects (wells,
springs, small distribution systems).
--Launched a water purification solution product, called Clorin, to
combat child mortality due to diarrhea; in partnership with
private sector, Clorin is being produced in Afghanistan.
--Provided access to basic health services to an area covering 3.8
million people in 17 provinces; 191,724 persons have been
treated at these clinics (75 percent of whom are women and
children).
--Rehabilitated the water systems for Kandahar and Kunduz, benefiting
650,000 people by increasing supply, pumping capacity,
extending service lines, and eliminating direct discharge of
human waste through provision of sanitary latrines.
Upcoming Accomplishments:
--Expand basic health services to an area covering 16.5 million
Afghans.
--Build or renovate up to 400 basic health centers in rural areas.
Strengthen Afghan Institutions to Assure Stability:
--Provided $58 million total to the Afghan Reconstruction Trust Fund
for budget support.
--Provided a food salary supplement, valued at 26 percent of income,
to 270,000 civil servants over 6 months. Recent assessment
concluded that a number of qualified civil servants returned to
their jobs because of this supplement.
--Effectively managed the currency conversion process on behalf of
the Central Bank through the provision of personnel to staff
the 52 exchange points, counters, shredders, and transportation
for moving the currency. Currency has maintained value and
stabilized against the dollar, since its roll-out in fall 2002.
--Rehabilitated 13 government ministries, including the provision of
daycare centers so that women can return to work.
--Provided critical assistance to the United Nations for the
emergency Loya Jirga, including logisticians who developed the
plan for implementation; air operations support; educational
films on the Loya Jirga process for communities; international
observers to ensure transparency in the selection of delegates;
and nationwide expansion of Radio Kabul broadcasts with
messages about the Loya Jirga process.
--Rehabilitated (i.e., electricity, office repairs) and/or provided
equipment (communications equipment, computers) to 19
Government ministries and offices.
--Provided daycare centers to Ministries to enable women to return to
work.
--Provided a satellite phone system and pouch mail so that the
central government in Kabul can communicate with its regional
offices.
--Established Afghanistan's first private sector FM radio station.
--Work with the Ministry of Finance and Central Bank to rebuild key
economic institutions, such as the banking system, revenue
collection, government financial management systems,
privatization, utility reform, and trade reform.
--Establishing 18 Women's Centers nationwide with accelerated
learning and health education programs.
--Supporting the Constitutional, Judicial, and Human Rights
Commissions.
--Establishing community radio stations.
CLEAN WATER IN IRAQ
Question. It is my understanding that access to potable water is
one of the more pressing problems facing Iraq today. What has USAID
done with respect to providing clean water to Iraqis?
Answer. USAID, through support to UNICEF, is addressing the need
for improved water supply by establishing a water and sanitation
coordination team comprising U.N. agencies, ICRC and international
NGOs, completing extensive water assessments and procuring and
distributing water treatment chemicals for communities in South and
Central Iraq.
USAID's private sector partner for capital construction, Bechtel,
will be rehabilitating up to 8 water treatment facilities in Basra, 6
water treatment plants in south central Iraq, and the Sabah Nissan
water treatment facility in Baghdad to increase treated water in east
Baghdad by 45 percent and in overall Baghdad by 15 percent.
Lastly, USAID plans to rehabilitate seven wastewater treatment
plants in Baghdad, the Central region and Mosul. All require
significant rehabilitation due to neglect during the sanctions period.
Some have suffered additional degradation due to looting. Reducing
sewage flow into the rivers is a key element to providing clean water
to Iraqis and to reducing Iraq's high infant mortality rate.
USAID USE OF AMERICAN GOODS IN IRAQ RECONSTRUCTION
Question. Home Depot believes that $50 million in sales of supplies
and equipment to Iraq could result in at least 300 new American jobs.
How is USAID maximizing the use of American goods and supplies in the
reconstruction of Iraq?
Answer. USAID has awarded all of its primary contracts and grants
to American firms. However, USAID is also maximizing the amount of
Iraqi goods and services to ensure that Iraqis are fully invested in
the reconstruction of their own country, which is also consistent with
Administration policy.
EGYPT
Question. How would you assess the effectiveness of AID's very long
and extensive program in Egypt? What are the prospects for real
economic and political reform in Egypt, and how could U.S. assistance
be used more specifically to promote those goals?
Answer. USAID has provided Egypt with over $25 billion since the
Camp David Accords. We have helped Egypt move from a socialist
centrally planned economy towards a more open, market-oriented economy.
In the 1970s, USG assistance helped restore and reopen the Suez
Canal, one of Egypt's major foreign exchange earners, along with oil/
gas and tourism.
Over $6 billion has been invested in physical infrastructure
programs including electric power, water, wastewater and sanitation,
telecommunications and transportation. Results: 95 percent of Egyptians
have access to electricity; 22 million citizens have access to water/
wastewater services; the number of telephones increased over seven-
fold.
Social and economic development strategies in health care, basic
education and agriculture have improved the quality of life for
millions of Egyptians. USAID has provided $134 million since 1990 for
small and medium enterprise development and micro-lending programs.
With USAID assistance, six not-for-profit business associations and two
banks are now implementing efficient and effective Small and Medium
Enterprise (SME) lending programs that are operating on a self-
sufficient basis. To date, 840,000 loans, valued at over 2.1 billion
Egyptian pounds, have been extended to 340,000 Egyptian entrepreneurs
with less than a two percent default rate. These loans have, in turn,
helped to create more than 240,000 jobs.
Child survival programs have been successful with infant mortality
falling by 45 percent and mortality rates for those under age five
falling by 53 percent.
USAID's program has helped the Government of Egypt (GOE) take the
steps to create a globally competitive economy by emphasizing policy
reforms supportive of increased foreign and domestic investment, export
oriented growth, workforce and business skills development, and
privatization and investment in Information Technology (IT). USAID's
efforts also culminated in the recent inauguration of an Egyptian IT
center in Chantilly, VA that will strengthen the U.S./Egyptian
technology partnership. In the 1990s, major reforms strengthened macro-
economic discipline, reined in inflation and privatized many state-
owned enterprises. Real economic growth averaged more than 4.6 percent
over the decade, and per capita GDP has climbed above $1,400.
The USG is currently negotiating with the GOE reforms that will be
necessary to strengthen the financial sector and underpin Egypt's
recent pound float. The floating of the pound is viewed as a
preliminary show of commitment from the GOE to financial sector reform.
It will enhance the competitiveness of Egyptian exports, tourism and
economy.
The USG is prepared to provide financial and technical assistance
towards strengthening the banking sector, including the privatization
of State Banks, as well as assistance to strengthen/reform insurance
and pension systems and securities.
The GOE hopes to negotiate a Free Trade Agreement (FTA) with the
USG. In order to achieve success in this effort a number of actions
will be required on the GOE's part.
While the USG intends to continue to provide some technical
assistance resources to trade and custom reforms, the GOE will need to
undertake on its own initiative certain steps towards achieving an FTA.
AMERICAN EDUCATIONAL INSTITUTIONS IN LEBANON
Question. The American educational institutions in Lebanon are
considered by most Lebanese and Lebanese Americans as a key component
of the American assistance program. Congress consistently supports the
American educational institutions. This support is demonstrated yearly
in bill and report language. Despite strong Congressional direction,
AID appears to resist funding the schools.
In fiscal year 2003, Congress provided $35 million in assistance
for Lebanon. The conference report directed that not less than $3.5
million should be provided to the American educational institutions.
Despite this clear statement of congressional intent, Administration
officials have indicated they plan to provide only $2.5 million for the
schools. Does the Administration plan to disregard the conference
report language on the American educational institutions in Lebanon?
Answer. The Administration continues to support to all of the
American Educational Institutions (AEI) in Lebanon: the American
University of Beirut (AUB), the Lebanese American University (LAU), the
International College (IC), and the American Community School (ACS).
However, USAID's program objectives and goals have grown, while
available funding has decreased. The program now includes: promoting
economic growth, building democracy and good governance, enhancing
Lebanese government control in southern Lebanon, and protecting the
environment, in addition to supporting the four AEIs. In order to meet
these goals, we have turned to funding projects using implementing
partners, such as NGOs and private-sector organizations, which have the
capability to execute our projects but lack alternative funding
resources. In contrast, AEIs do have endowments and the ability to
fundraise from their alumni. The USG has a commitment to those NGO
partners that are working on a sound and successful development program
that has and will continue to benefit millions of people all over
Lebanon.
Please note that during the period of 1999-2002, the AEIs received
$9.852 million in support from the American Schools and Hospitals
Abroad (ASHA) fund, managed by USAID. That support averages out to be
$2.463 million a year. For fiscal year 2003, ASHA funding to the AEIs
will continue.
In fiscal year 2003, the Administration has made available $24.77
million in economic support funds (ESF) for the Lebanon program. This
number reflects the 0.65 percent across the board cut for all ESF
assistance levels and the $10 million which is restricted, from being
provided to Lebanon under Section 1224 of the Foreign Relations
Authorization Act of fiscal year 2003. Given these constraints, and
consistent with the spirit of the language on AEIs in Lebanon contained
in the Conference Report on Foreign Operations, Export Financing, and
Related Programs Appropriations Act, fiscal year 2003 (which states
that $3.5 million of the original appropriation of $35 million should
be allocated to the AEIS), we are allocating 10 percent of the fiscal
year 2003 ESF funding made available for Lebanon, or $2.477 million, to
the American educational institutions in Lebanon.
PALESTINE
Question. The United States has been providing approximately $75
million a year since the Oslo process began to the Palestinians to help
alleviate their economic difficulties. Just last month, Congress
approved a supplemental bill that included an additional $50 million in
U.S. assistance to the Palestinians. Since the Palestinians began their
campaign of violence two and a half years ago, however, it has been
increasingly difficult to send U.S. personnel into the areas
administered by the Palestinian Authority to either monitor existing
programs or create new ones. How would you assess the effectiveness of
AID's programs in the West Bank and Gaza? How have you been able to
effectively monitor and initiate new programs, given the security
situation on the ground? How have you been able to ensure that US money
does not go directly into the hands of leaders of the Palestinian
Authority and that no U.S. money, either directly or through
subcontractors, goes to groups or individuals involved in terror?
Answer. Effectiveness of USAID's Programs in the West Bank and
Gaza:
--Over the past 2\1/2\ years escalating violence, terrorism, closures
and curfews have resulted in the virtual collapse of the
Palestinian economy and a growing humanitarian crisis. This
period has been tumultuous for Palestinian and Israeli
societies alike, and a potential disaster for the peace
process.
--The Palestinian Authority's (PA) ability to address the severe
problems faced by the population has been negatively impacted
by the destruction of PA infrastructure and the lack of
internally generated resources. Consequently, much of the
burden for addressing the on-going crisis falls to local and
international NGOs, and the international donor community.
Reform efforts have focused on working with key PA ministries,
while at the same time supporting a more dramatic overhaul of
PA institutions and operating styles.
--Despite a difficult political and security situation, program
implementation continues, albeit with some delays caused by
often limited access to project sites and border closures by
the Israeli Defense Force (IDF).
--USAID/WBG has achieved significant results across the portfolio,
through use of innovative implementation approaches and the
dedication of the staff, contractors and grantees, and other
Palestinian and Israeli counterparts.
--The Mission has helped to avert a humanitarian catastrophe;
initiated efforts to revitalize the Palestinian private sector
and to support reform; and maintained infrastructure,
institutional and human capacity development programs critical
for the formation of an independent Palestinian state.
Effective Monitoring Given the Security Situation:
--Because of the security situation, monitoring has been a major
concern. As such, the Mission has increased visits to project
sites through enhanced reliance on FSN staff and through the
expansion of Embassy and Consul General Regional Security
Office personnel, which permits our U.S. Direct Hire and
Personal Services Contract (PSC) staff to travel to the West
Bank and Gaza more frequently.
--We arranged for an IG Risk Assessment and enhance audit activities
during the coming year pursuant to the specific recommendations
from the IG.
--he Mission has exerted considerable effort to improve bilateral
relations with relevant Israeli officials, which has resulted
in permits for Mission, contractor and grantee staff to travel
more freely between Israel and the Palestinian Territories and
has facilitated cooperation generally with respect to project
planning and implementation.
Ensuring That U.S. Money Does Not Go To Groups Or Individuals
Involved In Terror:
--USAID funds its programs through U.S. contractors, U.S. Private and
Voluntary Organizations (PVO), Palestinian Non-Governmental
Organizations (NGO), and Public International Organizations
(PIO).
--To minimize the risk of Mission resources being used to support
terrorist organizations, USAID introduced a vetting process,
which has allowed the Mission to continue funding more than 400
Palestinian civil society organizations.
--All USAID programs are carried out through American contractors,
American and international non-government organizations (NGOs)
and Palestinian NGOs. Furthermore, working closely with the
Embassy's Country Team, USAID carefully checks the references
of all Palestinian NGOs who are to be recipients of funds to
ensure that there are no links to terrorist organizations or to
organizations advocating or practicing violence. These
reference checks are periodically updated.
--USAID and the Country Team preview requests for grants from
Palestinian NGOs, purpose of the grant, the NGO's previous
experience with managing grants, and the NGO's key personnel--
including their dates of birth to avoid false positives in the
vetting process. Decisions on whether or not to approve grants
to certain Palestinian NGOs are based on the totality of the
circumstances.
--USAID uses this information as part of its due diligence process in
deciding which NGOs should receive its grant funds.
Ensuring That U.S. Money Does Not Go Directly To The Palestinian
Authority:
--Until now, U.S. law has required that no USG funds are to obligated
or expended for direct assistance to: (a) the Palestine
Liberation Organization; (b) the Palestinian Authority; (c) a
Palestinian state; nor to; (d) the Palestinian Broadcasting
Corporation.
--The USG has now decided, for the first time, to give direct
assistance to the Palestinian Authority. A $20 million cash
transfer will be used to support municipal services and for
repair and rehabilitation of municipal infrastructure, such as
roads and water works.
--The U.S. stands solidly behind Prime Minister Abbas. Under his
leadership, a constructive change and empowerment of
Palestinian governing institutions is underway. His efforts to
end terror and violence present real opportunity to move
forward on President Bush's two-state vision. Palestinian
reform efforts are in progress. Besides having Prime Minister
Abbas to work with, Palestinian Authority finances are under
the stewardship of Finance Minister Fayyad, and are now largely
transparent and therefore, accountable to the Palestinian
people.
--The United States believes it is important to act now to reinforce
this positive progress and to signal support for Prime Minister
Abbas, Finance Minister Fayyad, and to help them establish
their authority on the ground.
--USAID will keep close track of how these funds are used via ongoing
consultations with Minister Fayyad, our Consulate General in
Jerusalem, and our USAID presence in Gaza and the West Bank.
All parties are well aware that the prospect of future such
direct transfers would depend on the degree of success of this
one.
institutionalizing private property rights
Question. What efforts has the agency made to instill the
principals of institutionalizing private property rights and leveraging
capital in developing countries as propounded by Hernando de Soto and
Institute for Liberty and Democracy (ILD)?
Answer. USAID has a long and highly productive relationship with
the Institute for Liberty and Democracy (ILD) and its director,
Hernando de Soto. USAID considers ILD a key partner in its long-
standing commitment to improving property rights systems and counts it
as one of our major success stories. The relationship began in 1982
when ILD was a fledgling institution and continues up to the present
day.
Over these 20 years, USAID has provided approximately $39 million
of financial assistance to ILD. In fiscal year 2003, USAID will provide
an additional $6 million to ILD. A main focus of this effort is the
establishment of an International Training Center.
ETHIOPIA FOOD CRISIS
Question. The news from Ethiopia about the food situation is not
encouraging. Could you please describe the U.S. efforts to alleviate
the suffering in Ethiopia? Are the Europeans and non-traditional donors
(such as China and Russia) doing their fair share?
Answer. The U.S. Government has provided over $400 million in
humanitarian assistance to Ethiopia this fiscal year to address both
food and other emergency relief needs. The food, health, nutrition,
water and sanitation, and agricultural recovery programs supported by
the U.S. Government have already saved and will continue to save people
from starvation and disease in Ethiopia.
In response to the Ethiopia 2003 appeal for emergency food
assistance, the U.S. Government has pledged approximately 878,790
metric tons (MTs) valued at over $393 million. This represents 57
percent of Ethiopia's total food aid requirements for 2003. Since the
onset of the emergency in 2002, U.S. Government food aid pledges to
Ethiopia now total over 1,000,000 metric tons valued at approximately
$475 million. The European Community has pledged 283,570 MTs. Other
donor countries have pledged an additional 338,786 MTs.
Regarding non-traditional donors, India has provided 10,000 MTs of
food aid.
FAITH-BASED HEALTH/DEVELOPMENT EFFORTS
Question. What is USAID doing to encourage faith-based health/
development efforts?
Answer. The Bureau for Global Health (BGH) is coordinating its
efforts with the newly opened Office of Faith-Based and Community
Initiatives (OFBCI) within USAID. In order to effectively address the
health needs in the developing world USAID will continue to partner
with religious organizations and local community initiatives in an
effort to reach areas in a comprehensive manner. The OFBCI is holding
regular meetings with the Bureau for Global Health to assess and reach
out to new partners.
The BGH is also coordinating with the OFCBI on eight regional
conferences, to encourage and reach out to new partners interested in
participating in USAID global health programs. These events will be
held throughout the United States.
______
Questions Submitted by Senator Ted Stevens
Question. Please provide a chart of agriculture funding.
Answer.
CHART OF USAID AGRICULTURE FUNDING 1992-2004
----------------------------------------------------------------------------------------------------------------
Dollars in
Fiscal year thousands Fund type Source
----------------------------------------------------------------------------------------------------------------
1992..................................... 625,277 Obligated................. Title XII Report
1993..................................... 449,535 Obligated................. Title XII Report
1994..................................... 415,258 Obligated................. Title XII Report
1995..................................... 434,530 Obligated................. Title XII Report
1996..................................... 307,825 Obligated................. Title XII Report
1997..................................... 244,754 Obligated................. Title XII Report
1998..................................... 331,231 Obligated................. Title XII Report
1999..................................... 346,365 Obligated................. Title XII Report
2000..................................... 338,104 Obligated................. Title XII Report
2001..................................... 328,985 Obligated................. Title XII Report
2002..................................... 446,303 Obligated................. Title XII Report
2003..................................... 473,877 Allocated................. USAID PPC/SPP
2004..................................... 470,200 Requested................. 2004 CBJ
----------------------------------------------------------------------------------------------------------------
Question. Please provide a breakdown of food aid funds for fiscal
year 2003 and fiscal year 2003 Supplemental.
Answer.
FISCAL YEAR 2003 USAID FOOD FOR PEACE (TITLE II) SPENDING PLAN JULY 2003
----------------------------------------------------------------------------------------------------------------
Fiscal year 2003
Fiscal year 2003 Fiscal year 2003 Bill Emerson
Country non-emergency emergency Humanitarian
Trust
----------------------------------------------------------------------------------------------------------------
Angola \1\................................................ $3,164,400 $111,012,000 ................
Afghanistan............................................... ................ 59,464,000 ................
Balkans................................................... ................ 15,536,000 ................
Bangladesh................................................ 38,566,000 ................ ................
Benin..................................................... 5,749,100 ................ ................
Bolivia................................................... 29,011,614 ................ ................
Burkina Faso.............................................. 6,761,300 ................ ................
Cameroon.................................................. 141,609 ................ ................
Cape Verde................................................ 5,177,900 ................ ................
Central African Republic.................................. 300,485 ................ ................
Central America........................................... ................ 10,500,000 ................
Chad...................................................... 3,959,194 ................ ................
Congo..................................................... ................ 2,300,000 ................
Djibouti.................................................. ................ 3,240,000 ................
North Korea............................................... ................ 50,000,000 ................
Democratic Republic of Congo.............................. ................ 35,000,000 ................
Egypt..................................................... 2,028,338 ................ ................
Eritrea................................................... 2,873,400 65,000,000 ................
Ethiopia.................................................. 25,891,089 328,000,000 $129,173,200
Gambia.................................................... 691,281 ................ ................
Ghana..................................................... 23,214,003 ................ ................
Great Lakes............................................... ................ 45,000,000 ................
Guinea.................................................... 6,190,200 ................ ................
Guatemala................................................. 24,930,399 ................ ................
Haiti..................................................... 36,957,200 4,000,000 ................
Honduras.................................................. 8,121,245 ................ ................
India..................................................... 44,774,900 ................ ................
Indonesia................................................. 14,379,600 17,000,000 ................
Iraq...................................................... ................ 170,000,000 45,785,500
Kenya..................................................... 23,779,600 10,000,000 ................
Laos...................................................... 660,810 ................ ................
Lesotho................................................... 1,630,635 ................ ................
Liberia................................................... 1,334,214 ................ ................
Madagascar................................................ 10,481,038 726,000 ................
Malawi.................................................... 3,287,200 ................ ................
Mali...................................................... 203,089 ................ ................
Mauritania................................................ 8,652,292 ................ ................
Mozambique................................................ 17,756,116 ................ ................
Nicaragua................................................. 13,738,579 ................ ................
Niger..................................................... 10,639,592 ................ ................
Pakistan.................................................. 4,289,936 ................ ................
Peru...................................................... 24,551,900 ................ ................
Rwanda.................................................... 13,369,300 ................ ................
Sahel/Mauritania.......................................... ................ 15,000,000 ................
Somalia................................................... ................ 20,000,000 ................
Southern Africa........................................... ................ 150,000,000 ................
Sri Lanka................................................. 682,895 ................ ................
Sudan..................................................... 347,590 100,000,000
Tajikistan................................................ ................ 10,000,000 ................
Uganda.................................................... 19,281,517 57,122,000 ................
West Africa Regional...................................... 1,142,000 ................ ................
West Africa Coastal....................................... ................ 42,000,000 ................
West Bank/Gaza \1\........................................ ................ 10,000,000 ................
Yemen..................................................... ................ 2,569,610 ................
Zambia.................................................... 1,500,000 ................ ................
Personal Services Contractors............................. 1,000,000 6,000,000 ................
Prepositioned Stock....................................... ................ 30,055,935 ................
Temporary Institutional Support........................... ................ 2,000,000 ................
International Food Relief Partnerships.................... ................ 5,000,000 ................
World Food Program \3\.................................... 2,218,830 51,000,000 ................
Farmer to Farmer.......................................... ................ 10,000,000 ................
-----------------------------------------------------
Subtotal............................................ 446,000,000 1,434,955,935 174,958,700
=====================================================
GRAND TOTAL \3\..................................... 2,055,914,635
----------------------------------------------------------------------------------------------------------------
\1\ Pending final country allocations.
\2\ Fiscal years 2003-2002 ITSH & Unallocated.
\3\ Includes $140,380,935 prior year funds & $174,958,700 from Bill Emerson Trust Drawdown ($1,880,955,935 in
new obligation authority).
RUSSIA BUDGET
Question. As you are aware, the President cut $75 million from the
budget for Russia, leaving a base budget of $73 million in total aid. I
am concerned that such a drastic cut does not take into account the
needs of the Russian Far East.
The RFE faces numerous challenges, including limited access to
these areas, a lack of infrastructure, a lack of basic amenities like
running water, waste disposal and sewer systems, and high rates of
fetal alcohol syndrome, alcoholism, and tuberculosis. This is similar
to the situation faced by many rural villages in my state.
Given the situation in the Russian Far East, what are USAID's plans
for allocating scarce resources to this area?
Answer. The anticipated sharp reduction in FREEDOM Support Act
funding in 2004, and its implications for future funding, will force
us, in consultation with the Assistance Coordinator's Office in the
State Department, to make difficult decisions among important
activities.
During the phase-out period of our Russia program, we will likely
continue to focus on the sustainability of civil society institutions
across all sectors that will be instrumental in continuing to push for
reforms and for building a democratic society in Russia. We will
probably also continue to emphasize our programmatic emphasis on
Russia's critical health problems--particularly HIV/AIDS, tuberculosis,
and unhealthy lifestyles. In addition, given the resources and
development potential of the Russian Far East, as well as its cultural
and historic ties to the United States, we anticipate continuing to
emphasize programs in this region.
In view of the economic progress Russia has made, most of the
proposed budget cuts will likely be borne by our economic growth
programs; some are slated for early termination and others will likely
be curtailed entirely. In some cases, those cuts are being made in 2003
to ensure that we have the resources for other priority areas in 2004.
IRAQ RECONSTRUCTION
Question. How can smaller companies and 8(A) minority businesses
such as Alaska native corporations participate in the rebuilding
effort?
Answer. USAID is indeed focused on the issue of business
opportunities for the smaller companies and 8(A) businesses during the
Iraq reconstruction effort.
Under the special authority which USAID awarded the Iraq prime
contracts, it was determined in the best interest of the government to
seek Small Business Subcontracting Plans from five of the eight
contracts awarded. Of those five, the percentages achieved by the prime
contractors are extremely promising and evidence that the Agency is
determined to raise the levels of small business utilization in its
contract award process. The resulting percentages achieved under the
Plan reflect both the Agency's determination and the primes' compliance
to significantly increase their draw on qualified small and
disadvantaged businesses as reconstruction activities continue in Iraq:
IRG (Personnel Support) at 14 percent; RTI (Local Governance) at 30
percent; Abt (Health) at 58.5 percent; Creative Associates (Education)
at 30 percent; and RMS (Logistics) at 29 percent. The Agency is also
requiring a similar plan under the agriculture contract currently being
awarded under full and open competition.
Since USAID does not have privy of contract with any
subcontractors, USAID holds the prime contractors responsible for
meeting the contractual requirements, as they will select the
subcontractors. Although USAID has provided significant and detailed
advice on qualifying for a subcontract on the our Agency's own website,
our Office of Procurement as well as Office of Small and Disadvantaged
Business have encouraged interested entities as Alaska native
corporations to contact Bechtel directly through its website where they
can register as a qualified candidate for subcontracting opportunities
in Iraq. We have been advised that Bechtel will review all electronic
applications and determine which will compete on future Iraq projects
as they arise.
In USAID's continuing effort to support small and disadvantaged
businesses in their drive to qualify for, and succeed in achieving
contracts, we are seeking to improve the Agency's capability to track
the levels of compliance of the large businesses with their
subcontracting plans. We are also working on expanding our current data
base of qualified small and disadvantaged businesses from which the
large businesses and prime contractors can draw for both Iraq
reconstruction projects as well as the Agency's universe of contracting
opportunities.
Question. In light of the need to create American jobs during this
economic downturn, what are your plans to utilize American suppliers,
shippers and contractors to rebuild Iraq?
Answer. USAID has awarded all of its primary contracts and grants
to American firms. However, USAID is also maximizing the amount of
Iraqi goods and services to ensure that Iraqis are fully invested in
the reconstruction of their own country, which is also consistent with
Administration policy.
______
Questions Submitted by Senator Larry Craig
PEREGRINE FUND
Question. During the fiscal year 2002 and 2003 processes, the
subcommittee twice provided $500,000 for The Peregrine Fund's
Neotropical Raptor Program. The project is based in Panama and extends
throughout the Neotropics.
Although The Peregrine Fund is not as well known as other
conservation organizations, it is still one of the most respected. They
are best known for the successful recovery of the Peregrine Falcon and
Mauritius Kestrel. Their work, however, extends beyond those species
and beyond the borders of this country. Domestically, they have
projects in Idaho, Arizona, Utah, and Texas. Internationally, they have
projects in Greenland, Panama, Mexico, West Indies, Peru, India,
Madagascar, Kenya, Papua New Guinea, and other countries. They focus on
endangered birds of prey to conserve nature.
Shortly before the Peregrine Falcon was recovered and removed from
the Endangered Species List, The Peregrine Fund drafted Raptor 2100,
the organization's strategic plan for the 21st Century. The objective
of this plan is to conserve the world's 296 species of diurnal birds of
prey. The importance of the Neotropics is obvious since the Neotropics
is home to 91 of these species.
The partnership between USAID and The Peregrine Fund dates back
several years with projects in Guatemala and Madagascar. The
Cooperative Agreement with USAID for the Neotropical Raptor Program was
signed in September 2002. The purpose of this agreement is to establish
hands-on conservation programs in critical areas of interest to USAID
and to help ensure the long-term sustainability of biodiversity
conservation through capacity building in the region.
The Cooperative Agreement requires The Peregrine Fund match the
$500,000 provided by the subcommittee and USAID with an additional
$125,000. I am pleased to say that The Peregrine Fund matched these
funds with an additional $600,000 in fiscal year 2002 and $600,000 in
fiscal year 2003.
Highlights from the first eighteen months of the agreement include:
--Completed educational needs and methods assessment in the Panama
Canal Watershed and Darien Province.
--Designed and implemented environmental education programs among
target communities near release sites in the Panama Canal
Watershed, forest frontier communities in Darien, and the
general population of Panama.
--Recruited and trained seven indigenous Ember and Wounaan
parabiologists in the Darien Province of Panama.
--Completed the first-of-its-kind Neotropical Raptor Conference that
brought together 150 raptor conservation practitioners and
decision makers from 16 countries.
--Established Harpy Eagle captive propagation program, with 17 eagles
hatched and 13 released to date, and staff undergoing training
in raptor food production, raptor propagation, and raptor
release techniques. Worldwide, only 15 other Harpy Eagles have
ever hatched in captivity.
--Implemented monitoring programs for two highly endangered species
of raptors on Grenada and the Dominical Republic.
I have been told that during briefings before staffs of this
subcommittee that USAID has not been complimentary about this project.
``Unproductive'' and ``not providing the agreed upon cost share'' are
two of the comments that have been reported to me.
The conclusion I reach when I review the quarterly reports and
financial status reports provided by The Peregrine Fund to USAID is
different. The results and cost share significantly exceed the
contractual obligation.
Please elaborate on these comments. What was said about the
projects and the basis from which it was said? Did you discuss these
views with the project manager at The Peregrine Fund? If not, why not?
If so, what was their response? Which individuals from USAID in DC have
visited the project's headquarters? Any other locations? Any plans to
visit?
Answer. Latin America and Caribbean Deputy Assistant Administrator
Karen Harbert has had discussions with Senator Craig's staff on these
issues. The Assistant Administrator of Latin America and the Caribbean,
Adolfo Franco, recently visited the Peregrine Fund in Panama. The Latin
America Bureau recently hosted a meeting with the Vice-President and
Program Manager of the Peregrine Fund in Washington to discuss this
year and future year funding.
______
Questions Submitted by Senator Patrick J. Leahy
IRAQ RECONSTRUCTION
Question. We were given the impression, before the war, that the
Administration was prepared to move quickly to address the immediate
relief and reconstruction needs. In fact, OMB, USAID, the Pentagon and
State Departments were very upbeat about their plans to avoid some of
the mistakes we saw, and continue to see, in Afghanistan.
I don't want to diminish what has been done, but clearly the
Administration has not met expectations. The humanitarian crisis that
some predicted did not happen, but there are still many Iraqis without
electricity, shelter, telephone service, gasoline, or other basic
necessities that many of them had before the war. Law enforcement seems
to be virtually non-existent. How do you explain this?
Answer. Despite challenges associated with security and looting, as
of July 6 national electrical generation was at 3,100 MW about 75
percent of the pre-war highest level. A key 400 kv line from Bayji to
Baghdad West was repaired and re-energized allowing excess power from
the North to be sent to Baghdad. High tension lines between Baghdad and
Basra remain down, preventing excess power from the South from reaching
the capital. Electricity in northern and southern Iraq has been
restored to pre-conflict levels and connected areas experience 24-hour
availability. Electricity availability in central Iraq is at 1,350 MW,
against an estimated current demand of 1,900 MW.
USAID has received reports that gas station lines in Baghdad are
much shorter and on June 5, gasoline distribution exceeded pre-war
levels of 5-5.2 million liters/day, with 5.5 liters delivered. Reports
from other cities such as Kirkuk indicate that fuel lines are almost
non-existent.
IRAQI CIVILIAN VICTIMS
Question. Thousands of Iraqi civilians were killed or injured, or
had their homes damaged or destroyed, in the war, many as a result of
U.S. bombs. In the Supplemental, Congress included the following
language:
``[$2.4 billion is appropriated for Iraq relief and reconstruction in
Iraq] including . . . for assistance for families of innocent Iraqi
civilians who suffer losses as a result of military operations . . .''
The Statement of the Conferees reads as follows:
``. . . The managers intend that USAID and the Department of State, in
coordination with the Department of Defense and nongovernmental
organizations, will seek to identify families of non-combatant Iraqis
who were killed or injured or whose homes were damaged during recent
military operations, and to provide appropriate assistance.''
This language is modeled on what we did in Afghanistan, where we
are trying to relieve some of the suffering and the anger and
resentment resulting from our mistakes. I don't know if you saw the May
10th NY Times article, ``For Family That Lost 10 to Bomb, Only Memories
and Grief Remain'', but I would encourage you to read it.
Would you get back to me or my staff with a strategy to implement
the law, so we can show that we are not turning our backs on these
people?
Answer. USAID is applying lessons learned from its experiences in
Afghanistan to apply to Iraq, including assistance in the repair of
damaged infrastructure based on community participation and
prioritization. USAID has a number of mechanisms that are available to
assist civilian victims, including its Community Action Program and
infrastructure reconstruction efforts that address health and education
facilities. Mission staff is actively assessing an appropriate strategy
and will be consulting with the Office of Coalition Provisional
Authority.
ARAB OPINION OF AMERICA
Question. Last year, this subcommittee held a hearing on democracy
programs. One of the issues we discussed was the low opinion of the
United States held by many in the Arab world. We found it both deeply
troubling and somewhat baffling, given that there is strong support in
many Muslim countries for American culture and technology.
I know that we have launched the Middle East Peace Initiative,
increased our public diplomacy, and reviewed our aid programs to these
countries to make them more effective.
In spite of this, the situation seems to be getting worse, not just
in the Middle East but in Muslim countries everywhere. A new Pew poll
found that Arab hostility towards the United States is on the rise,
including in key--and moderate--nations like Turkey, Indonesia, and
Jordan. For example, when asked who they have more confidence in,
President Bush or Osama bin Laden, 55 percent of Jordanians favored bin
Laden and only 1 percent favored President Bush. In Indonesia it was 58
percent to 8 percent.
Why do you think we are losing the battle of hearts and minds in
the Arab world?
Do you think these programs be effective if there is no resolution
to the Israeli-Palestinian conflict?
Answer. We defer this question to the State Department.
MILLENNIUM CHALLENGE ACCOUNT
Question. $1.3 billion of the President's fiscal year 2004 budget
is for the first installment of the new Millennium Challenge Account. I
support this, although I do not agree with the White House's plan to
create a new corporate bureaucracy to manage it. Who would implement
these programs?
Answer. The MCA is still a legislative proposal and as such a
number of the details await definitive legislative treatment.
Nonetheless, the Administration has given a great deal of thought to
how the MCC could be best implemented.
MCA programs would be founded on a partnership and be very focused
on one or two key strategic objectives that the country has identified
as its top priority to stimulate growth. In order to develop a
proposal, the MCA would ask countries to engage in a consultative
process with all the relevant civil society and private sector groups.
One of the central principles of the MCA is that it be a transparent
process from start to finish. This is why it is important that the
initial phase of developing a country proposal set the tone and
foundation for the development partnership. While the process may vary
considerably from country to country, the themes of transparency and
country leadership and ownership of the proposal are critical.
In some cases, technical assistance may be required to help a
country develop a proposal, which the MCC could offer. However, the
country would be managing the process; it would not be a case of the
MCC hiring consultants to develop a proposal it wants.
If a country's proposal is selected, a country contract would be
negotiated between the MCC and government. This does not imply that
those funds would only go to the government. To the contrary, it is
anticipated that MCC funds would go to a variety of national and
community actors and alliances. However, the government would sign the
agreement with the MCC and have overall responsibility for managing and
overseeing the contract. The reason a contract approach was chosen was
to underscore that both parties have an obligation to meet the terms
and conditions outlined in the contract.
The Administration anticipates that MCC funds would mobilize a
variety of economic actors in each country; to the extent that a
development result requires a public sector investment (schools or
roads), funds would be channeled through the government. However since
economic growth inevitably depends on the activities and investments of
the private productive sectors, community groups and civil society
organizations, the Administration expects that these institutions would
also participate, and even implement the bulk of the investments. In
all cases, the Administration expects that MCC funds would be disbursed
directly to the institutions implementing activities under the MCC
contract through the most flexible, but accountable mechanisms.
If a country selected for MCC funding has a USAID mission and
program, USAID would likely undertake a strategic review of the
program. In many cases, the USAID program would likely transition to
support the MCC contract. Some programs, such as those fighting HIV/
AIDS or trafficking in persons, might well be continued, while others
might logically be phased out or incorporated in the MCC program.
Indeed, one of the ways that USAID would complement the MCC is that
USAID has the ability to address regional issues, such as disease,
water resources, transport linkages, etc., that the MCC, by virtue of
being country-specific, cannot.
One of the basic premises for implementation of the MCC is that it
should be demand-driven. The Administration does not want to prescribe
the mechanics of how activities would be implemented. The
Administration anticipates that this would vary considerably from
country to country, knowing there are no ``cookie-cutter'' approaches
that would work across the board. However, the goal would be to employ
simple implementation mechanisms that require less oversight and less
U.S. management than traditional projects. There are a variety of
mechanisms for spending the funds, such as contracts or grants, but
these could be managed by the host country, following their policies
and procedures.
Because the management approach of the MCC would be to employ local
institutions for country development, it is appropriate that the MCC,
too, rely heavily on strong local institutions for the in-country
expertise it requires. Economic and financial analysis of specific MCC
investments can be contracted locally. Technical advisory services to
the MCC can be contracted locally. Monitoring and evaluation can
largely be contracted locally. Therefore, the Administration
anticipates that the full-time presence of U.S. Government employees
needed to manage the MCC could be significantly reduced.
Even though the Administration envisions a strong reliance on local
institutions, there would still be a need for limited MCC staff
presence in the field to facilitate, manage and oversee the
partnership. Due to the limited staffing, the Administration
anticipates that the Ambassador and Embassy staff would play a strong
supportive role of the MCC. We also believe that USAID field staff,
with its development expertise and knowledge of local culture and
context, would play a key role in supporting the MCC.
USAID presence in the field has rightly been repeatedly recognized
as its strongest suit. Thirty years of development experience has
taught the Agency that country context matters a great deal. USAID's
very capable field Missions could provide critical support to the MCC,
helping to work with local partners, finding creative, local solutions
to problems, and generally facilitating the work of the MCC. The basic
USAID activity in many of the likely MCA countries has been knowledge
transfer and building local capacity and institutions. In some cases,
continued USAID programs in institution building might be necessary for
a time to further build country capacity to manage MCC programs and
resources. USAID anticipates having a key role in supporting MCC
programs, USAID does not want to adopt a black or white approach to how
it would relate to the MCC in every country; rather we think each
country would need to be reviewed on a case-by-case basis.
Question. This is supposed to be new money, yet both the Child
Survival and Health Programs account and the Development Assistance
account, are being cut in the President's budget. How do you explain
this?
Answer. The MCA reflects a key part of President Bush's historic
commitment to increasing foreign assistance. The President's national
security strategy placed unprecedented emphasis on the role of
development as a tool of foreign policy. This emphasis is reflected in
his budget for foreign affairs. In his fiscal year 2004 Budget,
President Bush requested $28.516 billion for the Function 150 Account,
an 11 percent increase over $25.652 billion for the fiscal year 2003
Request. The fiscal year 2004 request for the Child Survival account is
higher than the request for fiscal year 2003. With respect to
Development Assistance, it is anticipated that activities in this
account would be complemented by the MCA and the Famine Fund and would
improve the overall delivery of effective foreign assistance.
Question. I also have questions about eligibility for the
Millennium Account. Countries must show that they are taking serious
steps to combat corruption, support health and education, and good
governance. That makes sense. But a country like Brazil would not be
eligible for the MCA because its per capita income is too high. Brazil
is a country of 100 million people of immense importance to the United
States, where a small percentage of the population is very rich and the
vast majority is desperately poor. Shouldn't we look at ways to use the
MCA to promote better policies in regions or states of a country with
such serious needs, and of such importance to the United States, as
Brazil?
Answer. MCA is part of an unprecedented and concerted commitment of
President Bush to increase and improve the effectiveness of foreign
assistance. It is the President's intention that the MCA, if enacted,
would focus on the poorest countries. In the first year of the MCA, the
President proposed that only the world's 74 poorest countries, those
that have a per capita income of $1,435, and that are eligible for the
soft window of the World Bank, would be considered for the program.
That is because the MCA is targeted on spurring growth in the best
performing poorest countries, providing the level of resources that can
really make a difference in moving them to a higher growth trajectory.
It will rely on country institutions--investors, business people,
political leaders and civil society--to design and lead the economic
growth of the country. MCA, as proposed, would therefore only assist a
limited number of countries. That leaves the large majority of the
developing world to USAID and other agencies and actors. Since the MCA
has not yet been enacted, countries have not yet been selected so it is
unclear if Brazil would qualify for MCA assistance. Nonetheless,
assuming Brazil would not qualify for MCA, the country would still
receive assistance from USAID.
DEVELOPMENT ASSISTANCE
Question. Despite the $2.5 billion increase above the fiscal year
2003 level, the President's fiscal year 2004 budget request would cut
funding for the Development Assistance account by $35 million. This
account funds everything from agricultural research to children's
education to environmental conservation to democracy building. It funds
the bulk of USAID's programs to alleviate poverty. How do you justify
cutting these programs? The total amount requested for Development
Assistance for fiscal year 2004 is $1.345 billion. That is less than my
tiny State of Vermont spends on public education. Do you believe that
this is enough for the richest, most powerful country in the world to
spend on combating global poverty?
Answer. In his fiscal year 2004 Budget, President Bush requested
$28.516 billion for the Function 150 Account, an 11 percent increase
over $25.652 billion for the fiscal year 2003 Request. This commitment
reflects President Bush's strong support for programs to assist those
less fortunate overseas. USAID's Development Assistance funding will be
complemented by other presidential initiatives such as the Millennium
Challenge Account ($1.3 billion requested) and the Famine Fund ($200
million requested) to assist in the effort to combat global poverty and
its ill effects.
COMPLEX EMERGENCY FUND
Question. Among the increases is $100 million for an emergency fund
for ``complex foreign crises.'' Are you familiar with this? Isn't it
essentially a blank check? What limits would there be on the use of
this fund? Could it be used for weapons?
Since the President has asked for this authority ``notwithstanding
any other provision of law,'' what is to prevent the fund from being
used to supply weapons to an autocratic government that violates human
rights?
Between the Peacekeeping Operations, Refugees, and Disaster
Assistance Accounts, it seems like the Administration already has broad
authority to respond to the complex foreign emergencies. What would
this fund allow you to do that you can't already do?
Answer. As the President's fiscal year 2004 budget states: This is
a proposal for a new appropriation that is intended to assist the
President to quickly and effectively respond to or prevent unforeseen
complex foreign crises by providing resources that can be drawn upon at
the onset of a crisis. This appropriation will be used to fund a range
of foreign assistance activities, including support for peace and
humanitarian intervention operations to prevent or respond to foreign
territorial disputes, armed ethnic and civil conflicts that pose
threats to regional and international peace, and acts of ethnic
cleansing, mass killing or genocide. Use of this appropriation will
require a determination by the President that a complex emergency
exists and that it is in the national interest to furnish assistance in
response. This appropriation will not fund assistance activities in
response to natural disasters because existing contingency funding is
available for that purpose. (Source: Budget of the United States
Government, fiscal year 2004--Appendix: International Security
Assistance, pp. 906-7).
FOOD AID AND FAMINE
Question. During the consideration of the last two appropriations
bills--the Omnibus and the Iraq Supplemental--I worked with Senators
Nelson and Kohl to attach two amendments that added over $1 billion
dollars to help address food shortages, especially Africa.
Unfortunately, during the conferences on these bills, the House
majority, working with OMB, knocked out $500 million of this badly
needed food aid funding. What would USAID do with an extra $500 million
in food aid? Could it be put to good use, for instance, in Ethiopia?
Answer. The United States remains far and away the largest donor of
emergency food aid in the world. USAID targets its emergency food aid
to the most severely affected populations worldwide. In the past 18
months, the Administration has provided 500,000 metric tons of
emergency food aid to Southern Africa. This year, U.S. donations to the
Horn of Africa will reach about 1 million metric tons. The President's
budget reflects a careful prioritization among the competing demands
for international humanitarian assistance. The President's request for
fiscal year 2004 retains our commitment to addressing the most severe
and critical emergency food aid needs. In addition to the requested
Public Law 480 Title II resources, the President has proposed a new
$200 million Famine Fund specifically designed to provide a new,
flexible tool to meet dire, unexpected famine needs. The Bill Emerson
Humanitarian Trust is available to meet unanticipated needs.
Question. I recognize that the Administration has requested $200
million for a new Famine Fund. I strongly support this request.
However, wouldn't the Famine Fund be more effective if the President's
request did not cut more than $300 million from the Disaster Assistance
and Title II food aid budget that could be used to augment resources of
the Famine Fund? Aren't we just moving money around?
Answer. Regarding your questions on food aid and famine, the
Administration believes that the $1.185 billion Public Law 480 Title II
request for food aid will enable the United States to meet its fair
share of anticipated worldwide emergency, protracted relief and
recovery, and non-emergency food aid requirements. The President's
combined request for Public Law 480 Title II and the Famine Fund for
fiscal year 2004 represents an increase in USAID-managed food aid
resources of over 16 percent compared to the fiscal year 2003
President's request. The Bill Emerson Humanitarian Trust is available
to meet any significant unanticipated emergency food aid needs. The
additional authority the Administration hopes to receive with the
Famine Fund will provide it with the necessary additional flexibility
to respond more effectively to famine threats than is currently
possible.
Question. What will the President's budget request mean for U.S.
contributions to world food needs, compared to historic levels for U.S.
contributions of 33-50 percent? What percentage of total contributions
will the President's budget provide?
Answer. The President's budget request was based on a review of
projected 2003 emergency needs and emergency trends for the past
several years. Exclusive of Iraq, if worldwide emergency food needs
remained static, the fiscal year 2004 Title II budget request would
provide sufficient food aid resources to meet approximately 28 percent
of worldwide emergency, protracted relief and recovery needs. Resources
will benefit drought victims, internally displaced populations,
refugees, and other food insecure groups. The Administration also
considers the Bill Emerson Humanitarian Trust as a viable tool for
unanticipated humanitarian food needs, as has been evidenced in its
effective use in fiscal year 2002 for the Southern Africa drought
response and in fiscal year 2003 for Ethiopia drought relief and Iraq
post-conflict support.
UGANDA
Question. Mr. Natsios, what do believe that it will take, in terms
of diplomatic capital and foreign assistance funding, to obtain a
peaceful resolution to the conflict in Northern Uganda that involves
the Lord's Resistance Army and Government of Uganda. Please discuss
specifics such as staffing needs, types of additional assistance, or
legislation that may be helpful in resolving this crisis.
I have been informed that USAID plans to spend $1.4 million in
emergency relief to the northern areas. Is this correct? Do you believe
that this is sufficient?
Answer. The longstanding conflict in northern Uganda has it's
origins in ethnic and political conflict going back to Uganda's
earliest years as a nation. The Lord's Resistance Army (LRA) leadership
is erratic and its objectives obscure. So in spite of the efforts of
many well-intentioned parties, the situation is as bad as ever.
Nevertheless, the United States is now committed to redoubling our
efforts, and we are working to see if we can help bring about a better
situation for the people in northern Uganda.
USAID has responded to this humanitarian crisis with both food and
disaster assistance, as well as development assistance resources to
support a northern Uganda peace effort. The U.S. Ambassador in Uganda
and the USAID Mission Director are coordinating their efforts to
develop confidence-building measures between the Government of Uganda
and the Lord's Resistance Army to work toward a peaceful settlement to
the current conflict. USAID staff in Washington and the U.S. Department
of State are also working closely together to support our diplomatic
and foreign assistance efforts with personnel and financial resources.
USAID/Uganda's strategic development assistance interventions in
the northern and western districts of Uganda aim to mitigate the impact
of conflict and increase community resilience through humanitarian and
relief-to-development assistance. USAID's $16 million Community
Resilience and Dialogue activity, which began in September 2002 and
will continue through 2007, assists the victims of conflict and torture
including communities living under threat of attack, families that have
moved to internally displaced persons (IDP) camps, current and former
abductees, and ex-combatants taking advantage of amnesty. USAID/Uganda
and the Government of Uganda have plans to begin a National
Reconciliation Dialogue to explore the roots of Uganda's various
conflicts and how to move Uganda beyond its cycle of mistrust among
certain groups. USAID/Uganda currently has sufficient resources to do
this under its Community Resilience and Dialogue Program.
In fiscal year 2003, USAID's Africa Bureau has provided an
additional $538,000 to fund full-time staff, third-party mediation
efforts, and conflict resolution activities. In the future, additional
development assistance resources will be needed to fund a program that
will provide expertise to the Government of Uganda on negotiating a
peaceful settlement with the LRA. This technical assistance would
support the Government of Uganda's Presidential Peace Team to
effectively engage the LRA.
In response to the humanitarian crisis in fiscal year 2003 as of
July 1, USAID Office of Foreign Disaster Assistance has provided over
$3.7 million in emergency humanitarian assistance to Uganda in the
sectoral areas of emergency health, nutrition, water and sanitation.
Working through nongovernmental organizations, OFDA has assisted
affected populations in Gulu, Kitgum, Pader and Lira districts. In
addition, USAID/OFDA has provided funds to the American and Ugandan Red
Cross Societies and the United Nations Office for the Coordination of
Humanitarian Affairs to support general assistance programs and the
coordination of activities throughout the region.
USAID's Office of Food For Peace has also provided 81,660 metric
tons (MT) of Public Law 480 Title II emergency food assistance, valued
at $50.1 million, through the World Food Program to meet immediate food
needs. This amount is more than triple the fiscal year 2002 spending
level of $15.3 million. As a result of the caseload in the north and
the southern drought, the caseload has jumped dramatically from 250,000
to 1.3 million people. The majority, 800,000 beneficiaries, are in the
north and the remaining 500,000 are in the drought-stricken Karamoja
region in the Northeast.
In the event of a peaceful resolution to the conflict, additional
development and humanitarian resources would be required to meet the
needs of demobilization and reintegration of populations affected by
the conflict. Resource levels will be determined by needs assessments
and conditions on the ground.
SUDAN
Question. Additionally, what resources will you need to do quick
impact programming in Sudan to help facilitate peace there?
Answer. USAID is currently developing plans, jointly with the
Sudanese parties and other donors, to address the funding needs of a
quick-impact program after a peace agreement is signed. Any peace
agreement must be followed by quick-start activities of rapid visible
benefits to communities, rehabilitation of basic infrastructure and
services, assistance to returning internally displaced persons (IDPs)
and refugees, and support of the new southern entity governing the
South. We welcome congressional interest in this matter and look
forward to further communication as plans develop.
WOMEN IN DEVELOPMENT
Question. Year after year, the Congress has recommended $15 million
for USAID's Office of Women in Development, but USAID has consistently
funded the Office at only about $10 million. This year I am told you
have cut it to $6 million. What do we have to do to get the funds for
this office that we believe it needs? Should we earmark it?
Answer. The budget allocation for WID for fiscal year 2004 reflects
the realignments necessary to accommodate the overall budget reductions
for the EGAT bureau. This will not adversely affect WID field
operations because the new ``Gender Matters'' indefinite quantity
contract (IQC) insures that field missions will have expanded access to
gender-related technical assistance.
CHILD SURVIVAL AND HEALTH PROGRAMS
Question. As I mentioned in my statement, the President has
received justifiable praise for signing the AIDS authorization bill.
But at the same time his budget would cut key foreign aid programs. As
I said on the Senate floor 10 days ago, funding for vulnerable children
is cut by 63 percent, funding to combat other infectious diseases
besides AIDS is cut by 32 percent, Disaster Assistance is cut by 19
percent, and Development Assistance is cut by 3 percent. There are also
cuts in food aid, refugee assistance, and other global health programs.
In response to my remarks, the White House spokesman said I was
making an ``apples and oranges'' comparison and that the Administration
has proposed programs that would accomplish some of the same goals. Can
you explain what he meant? Wasn't the MCA supposed to be new money?
Do you support these cuts, at a time when SARS is showing, once
again, how vulnerable we are to infectious diseases that originate half
way around the world?
Answer. The foreign assistance budget request reflects an attempt
to maintain a balance between health and other important development
areas. Within our parameters, our fiscal year 2004 request for health
programs has increased compared to our fiscal year 2003 request.
At the same time, the Administration has made HIV/AIDS its highest
health priority. This, unfortunately, has meant a reduction in funding
for child survival, maternal health and infectious diseases from
previous years. To minimize the impact of lower funding, we will
continue to work with partners in the public and private sector to
leverage efforts, and focus on populations most in need and on the most
effective interventions. In infectious disease we would protect
globally important core programs in TB and malaria--given the
tremendous burden of these diseases.
SARS, for the time being, is still a new outbreak requiring
investigation and emergency control, rather than a developmental issue.
Our priority must remain focused on addressing TB and malaria, which
kill millions each year and devastate families, communities and local
economies. Nevertheless, SARS clearly demonstrates that health
challenges and epidemiology will continue to change, and highlights the
importance of planning and flexible and sufficient funding to address
these changes quickly and effectively.
HIV/AIDS
Question. Mr. Natsios, the HIV/AIDS authorization bill that the
President signed recently recommends that funding to combat HIV/AIDS be
allocated as follows--55 percent on treatment; 15 percent on care, and
20 percent on prevention. In addition, one-third of the amount of the
money for prevention must be spent on abstinence programs.
How is [this] different from the way in which the Administration
currently spends funds on HIV/AIDS programs? Do you support these
percentage earmarks? Why not 50 percent, 10 percent and 30 percent ?
Why not earmark all your health programs like this?
The bill also establishes an AIDS ``Coordinator'' for all the U.S.
Government's international AIDS activities. But rather than just be a
coordinator, this person would have the final say over how every dollar
is spent, including USAID's budget for AIDS, TB, and malaria. Why does
this make sense?
Answer. USAID's HIV/AIDS programs have been traditionally
prevention-focused. However, in recent years, we have begun to
integrate significantly more care and treatment into our programs. The
availability of care options is essential in order for people to agree
to voluntary testing and counseling. With major declines in the price
of antiretrovirals (ARVs), and with greatly increased worldwide support
for ARVs, we are now adding ARV treatment to the care programs we have
been supporting for some time. While this will increase our treatment
budget, it does not necessarily diminish our focus on prevention.
As you know, the needs are great in all areas of prevention, care
and treatment. The scope and ``maturity'' of the epidemic, and the
available resources from the Global Fund, other donors and host
governments vary by country. There is, then, variation in the balance
of need between these categories in different countries. USAID,
therefore, seeks the greatest possible flexibility in deciding how to
program its funds, and would prefer not to have to adhere to strict
percentages in administering these funds on a country-by-country basis,
but can meet these percentages overall.
Assisting in the international struggle against HIV/AIDS does have
foreign policy implications, and needs foreign country expertise. The
State Department, therefore, is the right place for coordinating and
overseeing these efforts. Further, a single AIDS coordinator can
facilitate division of responsibilities among the increasing numbers of
U.S. agencies involved in the fight against HIV/AIDS. For over a
decade, USAID was the only U.S. Government agency fighting the pandemic
internationally. In recent years, however, the Departments of Health
and Human Services, Defense and Labor have all joined the fight. More
resources and expertise are what we need in this complex battle.
Finally, the coordinator model for the SEED and FSA account funds has
been successful, and we believe such a model for HIV/AIDS would be
equally successful.
FISCAL YEAR 2004 BUDGET REQUEST FOR FORMER SOVIET UNION
Question. The President's fiscal year 2004 budget request would cut
funding for the former Soviet Union from $755 million to $576 million.
Aid to Russia would fall from $148 million to $73 million. I know of
many USAID programs to promote legal reform, improve health care,
combat organized crime, improve market-based agriculture, clean up
toxic pollutants, and other initiatives that will be shut down because
of this cut. Does that make sense to you?
Answer. Part of the apparent large cut in the overall fiscal year
2004 request for Freedom Support Act (FSA) assistance reflects a shift
in funding for educational and professional exchanges from the FSA
account in the Foreign Operations appropriations request to the Bureau
for Educational and Cultural Affairs line item in the Commerce, State,
Justice appropriations request.
The lower request level also recognizes, particularly for Russia,
progress already achieved on reform, especially economic reform.
Programs in this area will likely be phased out over the next several
years.
We realize that Russia continues to face challenges in democratic
development. We are developing a strategy to phase out FSA assistance
to Russia over the next several years that will seek to ensure a legacy
of sustainable institutions to support civil society and democratic
institutions. During this time, we will increasingly focus on democracy
and rule of law to ensure that we consolidate and sustain the progress
made over the past decade. We will seek to advance structural changes
that are needed to create a hospitable environment for Russian civil
society.
FSA technical assistance programs have played a vital role in
advancing progress toward rule of law in Russia, including vital
support for the professionalization of Russian court administration and
judicial training; emphasis upon the importance of judicial ethics
(resulting in more openness by the Russian courts concerning
disciplining of judges); reform of law school curriculum, including
introducing and supporting clinical legal education; and supporting
every aspect of the development of the new criminal procedure code,
which has drastically changed the roles for Russian judges, prosecutors
and defense attorneys. As another example, legal volunteers from
Vermont, including judges, practicing attorneys, and staff of Vermont
Law School, have worked with the Republic of Karelia on a professional
development program for Karelian judges, legal educators, and
practicing lawyers. Our focus is now on helping the Russian bar
consolidate the gains it has made, particularly by sponsoring
professional education events to help the bar hone its advocacy skills.
In 2001, an interagency task force identified health as one of the
three priority areas for FSA assistance in Russia. Russia's growth rate
in HIV/AIDS in 2001 was one of the fastest in the world. Multi-drug
resistant TB is another serious problem, particularly in prisons.
Funding for health programs has increased over the last two years and
we plan to continue these programs for some years to come.
Some anti-crime activities that had been funded under FSA, such as
programs to combat organized crime and money laundering, will likely
continue, perhaps at different levels, with alternate funding sources.
Our strategy is not yet complete, so we don't have all the answers.
But we are determined to help Russia preserve the remarkable gains it
has made since 1992 and to complete the transition into a market-based
democracy.
RENEWABLE ENERGY
Question. There are more than 2 billion people in emerging markets
without electricity. There is an enormous opportunity for U.S.
companies that could help develop renewable energy resources to serve
their needs. Just as an example, I'm told that there is a $700 billion
global market to supply small hydropower technology and know-how over
the next few years.
While USAID seems to give a lot of attention to the oil and gas
areas within the energy sector, renewable and clean energy technologies
have not enjoyed the same strong support by USAID even though
congressional intent has been clear. Last year, we provided $175
million for energy conservation, energy efficiency, and clean energy
programs. Are you using any of this money for oil and gas development?
What steps are you taking to ensure that these funds are used to
promote a wide range of renewable energy sources?
Last year we required the President to submit a report on
greenhouse gas emissions, as we have in past years, ``not later than 45
days'' after the President's submission of his fiscal year 2004 budget
request. We should have received that report already. Do you have any
idea where it is?
Answer. For fiscal year 2003, Congress directed USAID to spend $175
million on global climate change mitigation and adaptation, energy
conservation, energy efficiency, and clean energy programs. The report
containing information on how USAID is complying with this directive is
currently at OMB. The energy expenditures for this directive total
$94.4 million which includes transfers to DOE and NRC. USAID's energy
assistance programs focus on three critical policy dimensions of the
energy sector: improved governance of the energy sector; enhanced
institutional capacity of public, private and non-governmental energy
sector participants, and increased public understanding of, and
participation in, the energy sector. Creating the conditions for
economic growth and poverty reduction requires increasing access of
people and business to modern energy, and increasing the affordability
of energy for consumers. This access and affordability, in turn,
requires a transformation of energy markets for all energy
technologies. Such market transformation involves changing the
foundation of the sector from politics to market economics and in
improving the effectiveness of government, private sector, and consumer
institutions in terms of management practices, technical operations,
resource use, and energy consumption. Therefore, our energy governance
programs benefit all fuel sources, including oil, gas, as well as
renewable energy and energy efficiency. Our programs in the oil and gas
sector are modest and include developing legal and regulatory
frameworks and some pilot scale oil field clean up activities in
Kazakhstan. With respect to renewable energy sources, USAID funds
activities that ensure that reformed energy sectors pay particular
attention to all clean energy technologies and incorporate clean
technologies and alternative energy into the mix. USAID's programs seek
to overcome market and institutional barriers to increasing access to
energy in rural areas and encouraging widespread adoption and use of
clean and renewable energy systems to meet development needs. Elements
include: supporting policies, technologies and business models that
result in increased access to modern energy services in underserved
areas; fostering implementation of policy or regulatory changes that
clarify or establish rights and incentives for the cost-effective
utilization of clean and renewable energy resources and technologies;
mobilizing business entities to pursue clean energy projects;
leveraging financial commitments to clean energy sources; and
catalyzing the establishment or strengthening of host-country
institutions for the explicit purpose of promoting clean and renewable
energy to meet rural development needs. This program directly supports
the White House Signature Clean Energy Initiative's (CEI) and the
Global Village Energy Partnership (GVEP). Our programs make extensive
use of Cooperative Agreements with U.S. NGOs that partner with in-
country institutions, Letter Grants with international development
organizations and multi-lateral development banks, Inter-Agency
Agreements with other USG agencies (DOE labs, EPA, USDA), and works
closely with other USG agencies (State and Commerce).
ENERGY PROGRAMS
Question. I have worked with Senator Byrd and others to open and
expand international energy markets and export U.S. clean energy
technologies to developing countries. These efforts help meet our
national and international energy needs as well as address related
trade and environmental objectives.
The Clean Energy Technology Exports Initiative can help meet that
challenge. This bipartisan initiative had its genesis in the Senate
Appropriations Committee, and could aid in meeting other nations'
infrastructure and development needs while also increasing the
deployment of a range of clean energy technologies, including
renewable, energy efficiency, clean coal, and hydroelectric
technologies. The Administration has talked about this, but little has
been done.
I assume you agree that it is in the long-term strategic interest
for the United States to help open and expand international energy
markets and export a range of U.S. clean energy technologies?
Are you aware that USAID is a leading agency involved in the
implementation of the Clean Energy Technology Exports Initiative? How
you are working to fulfill your agency's mandate under the Initiative's
strategic plan?
What actions is USAID taking to work with other federal partners
and non-governmental organizations, private sector companies, and other
international partners to implement this plan?
Answer. USAID, the Department of Energy, and the Department of
Commerce, working in collaboration with U.S. industry, spearheaded the
preparation of a five-year strategic plan for a clean energy technology
exports (CETE) program. A draft of the five-year strategic plan was
completed and submitted to the U.S. Congress. The strategic plan
outlines a program to increase U.S. clean energy technology exports to
international markets through increased coordination among federal
agency programs and between these programs and the private sector.
While supplemental legislation to fund the five-year plan has not been
forthcoming, CETE Agencies have used the strategic plan as a basis for
reconciling inter-agency relations in a way that emphasizes
institutional strengths and avoids overreaching for areas not in
Agencies' missions.
COFFEE CRISIS
Question. As you know, the rapid decline in the price of coffee has
had a devastating impact on economies of developing countries,
especially in Latin America. The coffee price crisis has also hampered
our foreign aid and counter-narcotics efforts. The President of
Colombia wrote a letter to me making the connection between the coffee
price crisis and our foreign aid programs.
In November 2002, the House and Senate passed bipartisan
resolutions urging the Administration to come up with a global,
coordinated strategy to deal with this crisis. What progress has been
made in formulating this strategy? Is USAID involved?
Answer. The Department of State is leading an interagency USG
effort to prepare a strategy on the coffee crisis. USAID is a member of
the drafting committee. A discussion draft has been completed and
circulated through an inter-agency review process. It is scheduled to
be submitted to the Deputies meeting hosted by the National Economic
Council the week of July 21.
UNIVERSITY REQUESTS
Question. We developed a new approach that USAID strongly supported
and which I believe you are familiar with. Unlike in the past, we no
longer specify which university requests USAID should fund, nor do we
specify a recommended dollar amount. We do list the university
proposals which we believed deserve serious consideration.
Unfortunately, it has not turned out as we had hoped. Universities
are still getting the run around. First, assuming they can locate
someone who can give them an answer, they are told that Washington
makes the decisions. Then they are told that the missions make the
decisions. This goes on until the universities eventually give up,
USAID declares victory, and we get the complaints.
I think we may have no choice but to earmark a pot of money for
these programs. We tried to help you, but it has not worked out. Do you
have anything to say?
Answer. We believe that the new Agency approach to managing
university requests is working well. We have processed 68 university
proposals (from 58 higher education institutions), which are listed on
the House and Senate Reports. A summary of this approach and a status
report on the 68 proposals follow below.
Two years ago USAID established a Higher Education Community (HEC)
Liaison position in its Office of Education in the Bureau for Economic
Growth, Agriculture and Trade. Martin Hewitt now serves as the HEC
liaison and is the key point of contact for universities seeking
information and advice on the opportunities and programs within USAID.
For tracking and management of unsolicited concept papers and
proposals, the HEC Liaison is supported by a working group within the
Agency. This working group is composed of representatives from the
regional and technical bureaus. The working group shares the
responsibility for either reviewing the proposal in the regional or
technical office (if the proposal is technical or sector specific with
no country cited) or for distribution to a USAID Mission (if the
proposal is explicit regarding a country where the planned activity
will be conducted). The working group shares the responsibility for
tracking the status of higher education proposals with the HEC Liaison.
The group communicates frequently to ensure that the improvements in
procedures and information flow are achieving their desired results.
In the House Appropriations Committee Report 107-663 and the Senate
Appropriations Committee Report 107-219, Congress included the
requirement that USAID report on the status of 68 university proposals
listed in the House and Senate reports.
The following actions have been taken concerning university
proposals:
--The HEC Liaison sent e-mails to every higher education institution
mentioned in the University Programs section of the Senate and
House Reports to direct them toward information about Agency
solicited competitive processes and opportunities. (Ten of the
universities mentioned submitted applications to the University
Partnerships competitive grant program).
--The HEC Liaison made personal telephone calls to thirty higher
education institutions listed in the Senate and House Reports
to ascertain the status of their proposal submissions and to
provide guidance.
--The HEC Liaison has been contacted by at least thirty higher
education institutions to request information about guidelines
for developing concept papers, proposals, and for information
about how the review process works (if the proposal aims to
work in a particular USAID/Mission, then the proposal is shared
with the Mission for review, if not, the proposal is reviewed
in a technical or regional bureau). Every call or e-mail from
higher education institutions to the HEC Liaison is responded
to in an informative and timely way.
--The HEC Liaison has participated in numerous conferences, meetings,
site visits, regarding the USAID-University relationship and
the specifics for how Universities can address Agency policies,
programs, projects and obtain support for doing so.
Following is the status of university proposals mentioned in the
House and Senate Reports (June 23, 2003):
------------------------------------------------------------------------
Total number of universities cited......................... 58
Total number of proposals cited............................ 68
Number of proposals received............................... 37
Number not received........................................ 31
Of those received:
Number of proposals approved........................... 17
Number rejected........................................ 12
Number under review.................................... 8
Total proposal funding (millions of dollars)............... 15
------------------------------------------------------------------------
Summary:
(1) 54 percent of proposals mentioned in the House and Senate
Reports have been received.
(2) 46 percent of proposals received have been funded.
(3) 32 percent of proposals received have been rejected.
(4) 22 percent of proposals received are under review.
The 17 successful proposals were approved because they met the
review criteria contained in USAID's brochure and website U.S. Higher
Education Community: Doing Business with USAID. The criteria include
two, which bear on the proposed activities' consistency with foreign
policy and development goals. They are: the extent to which the
proposal supports USAID's mandate and objectives, and the anticipated
long-term impact of the project and the nature of the on-going
relationship between institutions.
The major reason that the twelve proposals were rejected included:
--The failure to meet or support USAID's mandate or objectives in the
country, region, or sector
--The duplication of ongoing efforts
--Budget limitations in targeted bureaus, countries
--Lack of technical merit
In each case where proposals were rejected, a letter was sent to
the applicant informing them of the reasons why the proposal was not
accepted.
______
Questions Submitted by Senator Tom Harkin
PEOPLE WITH DISABILITIES IN AFGHANISTAN
Question. As you may know, I have been a long-time advocate for the
rights of people with disabilities and was one of the main authors of
the Americans with Disabilities Act. It is very important to me that
any reconstruction supported with U.S. funding be accessible to people
with disabilities and allow them to equally participate in civic and
community life. As I am sure that you will agree, it is critical that
at this crucial period in Iraq and Afghanistan where the people in
these two nations are rebuilding their futures, all voices be heard. It
is my hope that the Administration has given this some thought and I
would be eager to learn what the short-term and long-term plans USAID
has developed to address this important issue? I use the term
reconstruction to mean both physical structures and civil society. What
programs does USAID have to assist people with disabilities in
Afghanistan? Again, I would be interested in the short-term and long-
term programs.
Answer. In answer to both questions, USAID has taken an active role
in the development of two programs aimed at war-victims and people with
disabilities through the Leahy War Victims' Fund. One is a million
dollar grant to the Comprehensive Disabled Afghans Programme (CDAP) run
by UNOPS, to address needs of disabled Afghans. The other is a $2
million program from the Displaced Children and Orphans Fund (DCOF)
which will address some of these issues as well.
The Comprehensive Disabled Afghans' Programme (CDAP) has been
selected as the lead entity to assist the Ministry of Martyrs and
Disabled in developing national capacity in the field of disability.
This project provides quick impact interventions that will help to
address the problems faced by the Government of Afghanistan.
Consultation with the disabled population of Kabul, particularly
those involved in recent political activities, has established the need
for community-based outreach centers for the disabled in Kabul. The
disabled community would like to see basic rehabilitation services
provided, along with some ancillary services, such as job assistance.
Current procurement is open for bids for the running of five
rehabilitation centers. It is expected that the centers will open no
later than September 01, 2003 providing jobs, training and
comprehensive rehabilitation services.
DCOF has awarded a $2 million grant to three leading child-focused
agencies-Child Fund Afghanistan (CFA--also known as Christian
Children's Fund in the United States, International Rescue Committee,
and Save the Children/U.S.--to assist 50,000 vulnerable children and
families, including orphans, displaced children, working children, and
former child soldiers.
The three agencies, which work together as part of the NGO
Consortium on the Care and Protection of Children with CFA playing the
finance management role), will each focus on vulnerable children in a
particular geographic area. CFA will work in northeastern provinces
(Kunduz, Takhar, and Badakhshan); IRC will work in the Herat region;
and Save the Children will work in Kabul. The work will include:
--Specialized Community-based training
--Targeted Community Programs like youth-led civic works projects,
vocational training, income generation, and infrastructure
rehabilitation.
--Targeted assistance to highly vulnerable children, youth and
families through small grants, supplies and referrals.
In addition, USAID will be constructing handicapped accessible
schools and clinics throughout Afghanistan, and is facilitating the
distribution of 10,000 privately donated wheel chairs to the disabled
of Afghanistan.
SECURITY IN AFGHANISTAN
Question. Last year, President Bush said: ``We will help the new
Afghan Government provide the security that is the foundation for
peace.''
A month ago, the Washington Post reported that a private USAID
assessment concluded that: security issues have made it ``almost
impossible'' to manage some programs in much of the country and
``security risks will remain high for the foreseeable future.''
The U.N. Peacekeeping Force is limited to operating in Kabul; the
Afghanistan National Army is years away from being an effective force;
and there are too few U.S. troops to bring order to many of the
outlying areas. We are told there is talk of a NATO force, but so far
it seems to just that--talk.
In the meantime, the Karzai government is increasingly seen as
incapable of wielding authority outside of Kabul. I assume you saw last
Sunday's NY Times Magazine article about the continuing power of Afghan
warlords. Aren't you concerned that this is undermining USAID's ability
to rebuild the country? Shouldn't the United States be showing more
muscle against the warlords, to back up the central government and keep
reconstruction efforts in Afghanistan moving forward?
Answer. The security situation continues to be a constraint and has
hampered the development and reconstruction efforts. For example,
demining on the highway had to stop for a couple of weeks because of
attacks against the deminers. Security problems will continue to impact
reconstruction efforts and are a serious concern for the upcoming
elections. USAID staff are not able to visit and monitor projects
without being accompanied by armed security guards, or in some cases,
the military. This can also impact the monitoring of project
implementation.
AFGHAN MINISTRY OF EDUCATION
Question. What is USAID doing to support the Afghan Ministry of
Education? Are you providing training and equipment, so it can begin to
do its job?
Answer. USAID has recently awarded an $18.5 million contract to
Creative Associates International, Inc. (CAII), to implement the
``Afghanistan Primary Education Program'' (APEP). This program supports
the Ministry of Education (MOE) by providing textbooks for the current
academic year, teacher training, radio-based distance education for
teachers and accelerated learning opportunities for girls and boys who
were denied educational opportunities under the Taliban. In addition,
USAID fielded an education advisor to work with the ministry and assist
with curriculum revision and other activities to support capacity
development at the ministerial level. CAII is providing assistance to
the MOE with budgeting, planning, and data collection and analysis.
USAID, working with the University of Nebraska at Omaha and other
partners, provided 15 million textbooks for Afghan children for the
opening of schools last year. The University of Nebraska is also
continuing with teacher training. USAID has also committed to building
1,000 schools over the next three years.
AFGHAN MINISTRY OF WOMEN'S AFFAIRS
Question. What about the Ministry of Women's Affairs (MOWA)? Are
you helping to build its capacity, so it can work to address the needs
of women who have been so repressed?
Answer. Immediately upon reopening the Kabul Mission in January,
2002, USAID fielded a Gender Advisor, who works closely with the
Minister in planning activities, and initiated repairs to the MOWA
headquarters. USAID is also working with MOWA on its financial
management systems. USAID is funding the construction of 18 women's
centers in Afghanistan, one in each province, thereby covering over
half the country. We are also developing programs for these centers
whereby women can come together and learn basic technical and
vocational skills. In addition to supporting the Ministry of Women's
Affairs, USAID has integrated gender issues into its programming, so
that it can address the needs of women. USAID believes that the MOWA
should work to increase the capacity of relevant ministries to
mainstream issues that are relevant to women. We are concerned that
strengthening the MOWA alone will not ensure programs effectively
targeting women and girls are incorporated in the development agenda of
the TISA.
PEOPLE WITH DISABILITIES IN IRAQ
Question. As you may know, I have been a long-time advocate for the
rights of people with disabilities and was one of the main authors of
the American with Disabilities Act. It is very important to me that any
reconstruction supported with U.S. funding be accessible to people with
disabilities and allow them to equally participate in civic and
community life. As I am sure that you will agree, it is critical that
at this crucial period in Iraq and Afghanistan where the people in
these two nations are rebuilding their futures, all voices be heard. It
is my hope that the Administration has given this some thought and I
would be eager to learn what the short-term and long-term plans USAID
has developed to address this important issue? I use to term
reconstruction to mean both physical structures and civil society.
Answer. USAID's policy regarding people with disabilities stresses
the inclusion of people who have physical and mental disabilities and
those who advocate and offer services on behalf of people with
disabilities. This commitment extends from the design and
implementation of USAID programming to advocacy for and outreach to
people with disabilities. USAID's short-term plan has been to highlight
this policy to our private sector partners, especially before starting
rehabilitation evaluations of public facilities such as schools,
hospitals and airports.
USAID is also supporting $40 million in program funding to U.N.
agencies, including UNICEF, and NGOs including the American Refugee
Committee, CARE, Goal, IMC, IRC, Mercy Corps, Save the Children/U.S.,
and World Vision. The programs focus largely on Iraq's most vulnerable
populations, which include people with physical and mental
disabilities.
USAID PROGRAMS ENGAGING ISRAEL IN DEVELOPMENT ACTIVITIES
Question. The United States and Israel are in the last stages of
terminating a program called CDR/CDP that has been remarkably effective
in spreading Israeli technology and its unique agricultural advances to
nations in Africa, Asia and, particularly, in Central Asia. With the
increased AID focus on decentralization of aid programs, is there
anything that could be done to encourage our AID missions to utilize
the special expertise Israel brings to rural development in the
developing world?
Answer. First, a clarification will be helpful. CDR (the
Cooperative Development Research program) and CDP (the Cooperative
Development Program) are two distinct programs. Only the CDP is in its
final year of funding. CDR continues to be funded centrally at a level
of $1.5 million per year.
The Cooperative Development Research Program (CDR) has been an
effective way of partnering researchers from developing countries in
the Middle East, Africa, Asia, and Latin America with Israeli
scientists. In addition to agriculture, research teams who have
competed successfully for peer-reviewed grants have focused on projects
in health and the environment.
In recent years, the CDR Program has included a special initiative
that enabled scientists in the Central Asian Republics to partner with
Israeli and U.S. researchers. Due to a funding decision made by the
regional mission in the Central Asian Republics, this special CDR
program will no longer continue.
The Cooperative Development Program (CDP) received its last
allocation of central funding in fiscal year 2003. This program was
designed to enable the Israeli development program, MASHAV, an arm of
the Ministry of Foreign Affairs, to work with partners in developing
countries on agricultural issues and to provide training on a variety
of subjects in Israel. After many years of successful expansion and the
commitment of about $75 million, it was agreed that central funding
from USAID for this Program was no longer needed. However, USAID
missions have been encouraged to continue working with MASHAV, in areas
where they and their partner institutions have great strength. USAID/
Central Asian Republics has been one of the missions that has done so,
starting in fiscal year 2001. The program in the region has involved
agriculture, health, and agribusiness. The Mission-funded agreement
runs until the end of fiscal year 2005.
IOWA UNIVERSITY REQUESTS
Question. Over the past several years, a few universities and
colleges in Iowa have submitted proposals to USAID for funding. They
have been frustrated by the endless bureaucracy and the lack of a
transparent process wherein all universities and colleges that are
interested in pursuing possible USAID funding would be fully informed
in a timely fashion about submitting their proposals and supporting
rationales to the appropriate USAID office(s) for peer review and
merit-based decisions on which proposals would be funded. Furthermore,
the Committee has pointed out this problem to USAID and has urged
action on this issue in previous reports yet this continues to be a
problem. What steps, if any, are being taken by USAID to address this
problem?
Answer. Two years ago USAID established a Higher Education
Community (HEC) Liaison position in its Office of Education in the
Bureau for Economic Growth, Agriculture and Trade. Martin Hewitt now
serves as the HEC liaison and is the key point of contact for
universities seeking information and advice on the opportunities and
programs within USAID.
For tracking and management of unsolicited concept papers and
proposals, the HEC Liaison is supported by a working group within the
Agency. This working group is composed of representatives from the
regional and technical bureaus. The working group shares the
responsibility for either reviewing the proposal in the regional or
technical office (if the proposal is technical or sector specific with
no country cited) or for distribution to a USAID Mission (if the
proposal is explicit regarding a country where the planned activity
will be conducted). The working group shares the responsibility for
tracking the status of higher education proposals with the HEC Liaison.
The group communicates frequently to ensure that the improvements in
procedures and information flow are achieving their desired results.
In the House Appropriations Committee Report 107-663 and the Senate
Appropriations Committee Report 107-219, Congress included the
requirement that USAID report on the status of 68 university proposals
listed in the House and Senate reports.
The following actions have been taken concerning university
proposals:
--The HEC Liaison sent e-mails to every higher education institution
mentioned in the University Programs section of the Senate and
House Reports to direct them toward information about Agency
solicited competitive processes and opportunities. (Ten of the
universities mentioned submitted applications to the University
Partnerships competitive grant program).
--The HEC Liaison made personal telephone calls to thirty higher
education institutions listed in the Senate and House Reports
to ascertain the status of their proposal submissions and to
provide guidance.
--The HEC Liaison has been contacted by at least thirty higher
education institutions to request information about guidelines
for developing concept papers, proposals, and for information
about how the review process works (if the proposal aims to
work in a particular USAID/Mission, then the proposal is shared
with the Mission for review, if not, the proposal is reviewed
in a technical or regional bureau). Every call or e-mail from
higher education institutions to the HEC Liaison is responded
to in an informative and timely way.
--The HEC Liaison has participated in numerous conferences, meetings,
site visits, regarding the USAID-University relationship and
the specifics for how Universities can address Agency policies,
programs, projects and obtain support for doing so.
Following is the status of university proposals mentioned in the
House and Senate Reports (June 23, 2003):
------------------------------------------------------------------------
Total number of universities cited......................... 58
Total number of proposals cited............................ 68
Number of proposals received............................... 37
Number not received........................................ 31
Of those received:
Number of proposals approved........................... 17
Number rejected........................................ 12
Number under review.................................... 8
Total proposal funding (millions of dollars)............... 15
------------------------------------------------------------------------
Summary:
(1) 54 percent of proposals mentioned in the House and Senate
Reports have been received.
(2) 46 percent of proposals received have been funded.
(3) 32 percent of proposals received have been rejected.
(4) 22 percent of proposals received are under review.
The 17 successful proposals were approved because they met the
review criteria contained in USAID's brochure and website U.S. Higher
Education Community: Doing Business with USAID. The criteria include
two, which bear on the proposed activities' consistency with foreign
policy and development goals. They are: the extent to which the
proposal supports USAID's mandate and objectives, and the anticipated
long-term impact of the project and the nature of the on-going
relationship between institutions.
The major reason that the twelve proposals were rejected included:
--The failure to meet or support USAID's mandate or objectives in the
country, region, or sector
--The duplication of ongoing efforts
--Budget limitations in targeted bureaus, countries
--Lack of technical merit
In each case where proposals were rejected, a letter was sent to
the applicant informing them of the reasons why the proposal was not
accepted.
As for the four proposals from the two Iowa Universities (the
University of Iowa and Northern Iowa University) cited in the
University Proposals section of the Senate and House Reports, one
proposal was accepted (Northern Iowa--$272,000), one was supported by
the Department of State (Northern Iowa University), and two were
rejected (the University of Iowa and Northern Iowa University).
______
Questions Submitted by Senator Mary L. Landrieu
COMMITMENT TO AFGHANISTAN
Question. Is the United States committed to a long-term presence in
Afghanistan? Are we dedicating enough funds to Afghanistan? What areas
are deserving of greater support and attention? How many years do you
anticipate USAID's involvement?
Answer. As President Bush has stated, the United States is
committed to Afghanistan for the long-term and that includes USAID.
With Administration and Congressional support, USAID intends to stay in
Afghanistan as long as we have a role to play in assisting the Afghans
recover from years of war, drought, and underdevelopment. The needs of
Afghanistan have far outstripped donor resources. However, the United
States has been, and will continue to take a lead role in delivering
reconstruction assistance in many of the most critical areas. Since
September 11, USAID alone has programmed nearly a billion dollars in
assistance.
More needs to be done to rejuvenate Afghan livelihoods to include
job creation in both traditional (e.g., agriculture) and non-
traditional sectors. Afghans need to feel secure in order to invest in
their and their children's future. Without a more secure environment,
free of crime and corruption, reconstruction will be slowed. So the
other area deserving of attention is security.
Question. Do you support Secretary Powell's funding goal of $8
billion for Afghanistan?
Answer. I do support the Secretary's funding goal for Afghanistan.
WOMEN IN AFGHANISTAN
Question. Would you support a requirement to set a percentage of
aid to be directed toward the advancement of Afghan women or be
conducted by women-led relief organizations?
Answer. This Administration, as well as prior ones, does not seek
or encourage earmarks, however well-intentioned. USAID's approach to
assisting Afghan women is to incorporate them into all our programming,
with a special emphasis on their most critical needs, rather than
promote specific set-asides. The most critical need of Afghan women is
improvement in healthcare. Afghanistan has the highest maternal
mortality rate in the world along, with Sierra Leone. Many of these
deaths are preventable. USAID's $133 million (over 3 years) health
program focuses on maternal/child health in the rural areas where 80
percent of Afghanistan's population live and where there are completely
inadequate health services for women.
The second most critical need is education. USAID's $60 million
education program (over 3 years) emphasizes drawing girls back into
school including construction of girls-only schools; accelerated
learning programs for girls who missed out on education under the
Taliban; and other incentives, such as cooking oil to families that
send their daughters to school.
Both the health and education components include job creation
opportunities (teachers and community health workers) for women.
USAID's agricultural programs are seeking to expand income generation
opportunities to women, such as food processing and vegetable gardens.
We have worked with a number of Afghan women-led groups and we look
forward to continuing and expanding these relationships.
ENHANCING WOMEN'S ROLE IN AFGHAN SOCIETY
Question. What are we doing to ensure Afghan women will have a
direct role in society?
Answer. USAID is supporting activities in women's education,
employment, and women's centers which empower them to assume a more
direct role in society. Below we provide specific activities, with
funding amounts, in each of these areas:
Education/Training for Afghan Women and Girls:
--Assistance in 2002 school year: Trained 1,359 teachers, 907 of whom
were women, and printed 15 million textbooks for 2002 school
year, contributing to an increase in girls' enrollment from
90,000 under Taliban in 2001 to 900,000 in 2002 school year.
(Total project funding including teacher training and textbook
printing: $7,709,535) Reconstructed 142 schools, daycare
centers, teacher training colleges, and vocational schools.
(Total activity funding approximately: $5.5 million) In
addition, USAID provides a food salary supplement to 50,000
teachers equal to 26 percent of pay. (Total USAID food aid
funding in fiscal year 2002: $158,600,000; Total USAID food aid
funding to date in fiscal year 2003: $42,662,800)
--Assistance in 2003 school year and going forward: USAID printed and
distributed 10.7 million textbooks for 2003 school year. Early
indications show about a 30 percent increase in enrollment over
2002; many of these new students are expected to be girls,
which will be known with greater certainty when the enrollment
survey is completed in summer 2003. USAID's new education
program will support accelerated learning programs for up to
60,000 children, mostly girls that missed education under the
Taliban. USAID intends to rebuild between 1,000-1,200 schools,
benefiting 402,000 students, over three years. In addition,
USAID continues a food salary supplement to 50,000 teachers
equal to 26 percent of pay. (Education budget is $60.5 million
over three years; $7.41 million has been obligated to date)
--Food-for-Education Program: Through WFP, USAID is supporting
distribution of food to schoolchildren in several districts of
Badakhshan Province, in northeastern Afghanistan. Approximately
27,000 children and 1,500 teachers and service staff in 50
schools have received a four-month ration of wheat flour. Under
this program, girls receive five liters of vegetable oil every
month as an extra incentive for regular school attendance. The
program increases school attendance, reduces dropout rates, and
encourages families to send girls to school.
--Through the Afghan NGO, ACBAR, USAID supports a program to
encourage Afghan women and girls to read by hosting reading
classes and improving the country's libraries. The staff of
nine libraries within eight provinces is receiving training and
supplies of books. (Total activity funding: $61,180)
Employment for Afghan Women:
--Widow's Bakeries: USAID supports the World Food Program's (WFP) 121
Widow's Bakeries in Kabul, Mazar, and Kandahar. In Kabul, the
bakeries provided 5,000 children with fresh bread in school.
Overall, through employment and provision of subsidized bread,
WFP reports that 200,000 urban vulnerable people benefited from
this program in CY 2002. USAID support represented over half of
WFP's CY 2002 budget in Afghanistan.
--Daycare Centers: Seventeen centers have been built for Government
ministries and offices to enable women to return to work.
(Total activity funding: $151,506)
--Women's Entrepreneurship: Through USAID's work with the Ministry of
Finance in trade and investment promotion, USAID has written an
action plan, approved by Minister of Finance Ghani, which
includes: capacity building for women in all areas of trade,
including export promotion, administrative trade barrier
issues, licensing, and small and medium business development.
--Income Generation Opportunities: Some examples include:
--3,200 women, primarily widows, receive approximately $30 for 15
days work, producing clothing and quilts in three women's
centers in Charikar, Taloqan, and Maimana ($2/day is also
the typical wage for male labor). In addition, the women
receive basic health education and some English training
while working in the centers.
--The women of northwestern Afghanistan are receiving tools and
materials to generate their own income through activities
such as growing kitchen gardens, embroidering, producing
cheese and yogurt and crafting shoes. (Total activity
funding: $51,072)
--400 women returnees in the Shomali, an area devastated by the
Taliban's ruin of its household poultry stock, have
received 10 breeding chickens each to generate family
income.
--100 women, mostly widows, employed in raisin processing in
Kandahar.
--Rehabilitation of the offices of the NGO, ARIANA so they can
provide vocational training to 1,800 women. (Total activity
funding: $12,470)
--Women's Employment through USAID's Major Agriculture and Rural
Incomes program (RAMP): Agriculture employs 70 percent of
Afghanistan's labor force, and Afghan women play a large part
in agriculture, especially in raising livestock. RAMP will
improve the technical capacity of Afghans for raising
livestock. RAMP will also provide women entrepreneurs with
innovative opportunities for credit and business training. This
activity will be particularly helpful for women-headed
households, which are among the most vulnerable in Afghanistan.
Afghan Women's Centers:
--USAID built and furnished the first Women's Resource Center. (Total
activity funding: $60,000) USAID is currently engaged in
building and providing programming for seventeen women's
centers throughout Afghanistan. Three of these are currently
under design in Jalalabad, Samangan, and Taloqan. (Total
activity funding: $2.7 million) The Ministry has recently
identified 14 more sites for USAID to build and furnish
centers. ($2.5 million obligated in fiscal year 2002
Supplemental funds) In addition, USAID will fund programming
for the centers, e.g., health education programs, daycare, etc.
($5 million of fiscal year 2003 funds to be obligated early
this summer)
Lastly, improved women's health is strongly linked to the ability
of Afghan women to assume a more direct role in society. One of the
central goals of the three year, $100 million REACH program is to
reduce Afghanistan's high maternal mortality rate. The program will
accomplish this goal by building 400 new clinics and funding
performance grants to NGOs to provide a basic package of health
services, particularly in rural areas, where medical care is most
scarce. A major component of this program will be to increase women's
access to skilled birth attendants and essential obstetrical services
through an extensive training program. The first obligation for REACH
is expected in the first week of May.
IRAQ RECONSTRUCTION BUDGET
Question. What is the total reconstruction budget for Iraq--
including funds seized from Iraqi assets?
Answer. This question is most appropriately addressed to the
Department of Defense. USAID is using congressionally appropriated IRRF
funds to provide rapid improvements to the quality of life in Iraq.
Question. Congress recently provided $2.5 billion in the emergency
supplemental for relief and reconstruction in Iraq. While USAID does
not control the funds, how much has been disbursed and how much do you
anticipate USAID to receive for reconstruction programs?
Answer. USAID expects to receive $1.1-$1.3 billion for the
reconstruction effort and $500 million for relief. As of July 9, $361
million was obligated for reconstruction and over $107 million has been
expended.
Question. Have all USAID accounts that were ``borrowed from'' for
pre-positioning supplies in Iraq been reimbursed?
Answer. Yes, all the ``borrowed'' funds have been reimbursed by
OMB.
IRAQ RECONSTRUCTION
Question. In Iraq, what is your role?
Answer. The USAID Administrator provides day-to-day executive
direction and leadership on Agency programs and management operations
to ensure a fast-paced relief and reconstruction effort. As in other
countries, USAID/Iraq is led in the field by a Mission Director, Lewis
Lucke, who reports to the Assistant Administrator of the Asia and Near
East Bureau, Ambassador Wendy Chamberlin. Ambassador Chamberlin reports
to the Administrator.
Question. How many USAID staff are in Iraq? How is the security
environment there affecting their ability to work? Is it true that
USAID's Iraq Mission Director is actually living in Kuwait, because it
is to unsafe to work effectively in Baghdad?
Answer. As of July 8, USAID had 71 staff working in the region in
support of USAID's Iraq programs. Of the 71 personnel, 35 are
physically in Iraq. This number is limited by communication links and
billeting space. There continue to be security incidents which limit
the effective delivery of services, materials, and supplies. USAID's
Iraq Mission Director is now working primarily in Baghdad. USAID has
had full-time staff in Baghdad since April 23.
Question. What plans do you have for increasing the number of USAID
staff there?
Answer. USAID recognizes the importance of providing robust
oversight of appropriated funds. USAID's Asia and Near East Bureau has
prepared an initial mission structure that is under review, which
proposes 16 U.S. Direct Hire and a number of contract and Foreign
Service National staff.
Question. Recently, Sec. Rumsfeld said we will stay in Iraq only as
long as necessary, and not a day longer.
Is the United States committed to a long-term presence in Iraq to
establish peace and security? Wouldn't a short-term departure only
allow the forces of fanaticism and fundamentalism to re-emerge?
Answer. USAID is focused on addressing immediate reconstruction
requirements in Iraq and meeting the essential targets established for
each sector in which it works. USAID expects to fully spend its portion
of the Iraq Relief and Reconstruction Fund (IRRF) by September 2004 and
is prepared for a long-term presence should the Administration make
that decision.
Question. Are we dedicating enough funds to the reconstruction of
Iraq? ($2.4B in the Supplemental with no request in fiscal year 2004)?
After all, the Marshall Plan had a price tag of $88B in today's
dollars. Can we expect future supplementals and money in the fiscal
year 2005 request to fund Iraqi reconstruction?
Answer. USAID is prepared to implement a longer-term program should
the President request additional resources from Congress.
Question. What are we doing to ensure Iraqi women will have a
direct role in society--to vote, work, go to school, and serve in the
new government? Would you support a call to require that a set
percentage of aid be directed toward the advancement of Iraqi women, or
be conducted by women led relief organizations?
Answer. USAID-supported gender programs include provisions for the
hiring of female staff to work with vulnerable women, including as
traditional birth attendants and for assessments; food and potable
water support for war-affected women of childbearing age; and the
construction of gender-specific latrines for internally displaced
persons.
USAID is planning to put into place in Iraq up to two major micro-
finance lending institutions. USAID's experience elsewhere shows that
such institutional lending goes predominantly to women to start small
enterprises. The loans are typically small loans around $50 to $300.
These women entrepreneurs will be able to borrow privately. USAID is
also planning to implement a macro economic program to bolster economic
growth in Iraq.
Regarding education, USAID will be developing an accelerated
learning program for youth who have dropped out of school. Of these
children, a majority are girls, and this program will be designed to
get them back to school at the appropriate educational level. Second,
through the water and sanitation program, USAID will ensure there are
sanitary facilities for girls in schools, which will encourage girls to
come back to school and increase the rate of girl's enrollment.
Question. Humanitarian relief organizations still report
difficulties in delivering aid to the Iraqi people. Only after people
have food and shelter, will the Iraqis truly see America as wanting to
liberate Iraq, and not occupy Iraq. What steps are we taking to make
the delivery of humanitarian supplies as efficiently as possible?
Answer. The U.S. Government has supported the United Nations World
Food Program with cash, Public Law Title II food commodities and
Emerson Trust food commodities in the amount of $480,033,000. With
these and other resources, the World Food Program (WFP), in partnership
with Iraq's Ministry of Trade, has reestablished the Public
Distribution System and successfully completed the June ration
distribution nationwide. More than 400,000 metric tons of wheat flour,
rice, oil, pulses, infant formula, sugar, tea, soap and detergents have
been distributed internally to approximately 26 million Iraqi
beneficiaries.
Distributions for the month of July have already begun and the
Ministry of Trade has publicly announced the July ration through
television, radio and print media.
By supporting WFP, the United States has helped assure the delivery
of more than 758,128 metric tons of food commodities to Iraq from
neighboring countries for the month of June. This is equal to a food
pipeline of more than 1,000 metric tons entering Iraq per hour, 24
hours a day, seven days a week, sustained for a period of 30 days. To
assure rapid delivery to all points in Iraq, the program is using the
transportation corridors in Turkey, Jordan, Syria, Iraq (through Umm
Qasr port), Kuwait and Iran.
The WFP program is planned to continue through the month of October
2003.
USAID/DOD RELATIONSHIP IN IRAQ RECONSTRUCTION EFFORTS
Question. The reconstruction effort in Iraq is being headed up
under the DOD's Office of Reconstruction and Humanitarian Assistance
(ORHA). Congress appropriated $2.48 billion for reconstruction and
humanitarian aid in the supplemental bill earlier this spring. USAID
has traditionally been the government agency to manage reconstruction
and humanitarian assistance.
What is the relationship between USAID and ORHA? Does USAID have
sufficient input with ORHA so that reconstruction and humanitarian
efforts are efficient and expedient? Is ORHA interested in USAID's
expertise and history in the international development business?
Answer. USAID maintains a close and productive relationship with
ORHA and its successor, the Coalition Provisional Authority (CPA). All
projects are approved by Ambassador Bremer and CPA's Program Review
Board before being sent to OMB and notified to the Congress. USAID
closely coordinates in the field with military civil affairs officers,
CPA civilian staff and Iraqis.
AIDS IN EASTERN EUROPE AND FORMER SOVIET UNION
Question. This year, the President requests only $1.2 million for
HIV/AIDS initiatives in Eastern Europe and $15.4 million in the Former
Soviet Union. I have been to Romania three times. I know the horror
stories of the mother-to-child transmissions and the HIV orphans. The
AIDS problem is very real in Eastern Europe and the Former Soviet
Union.
The problems in Eastern Europe and the Former Soviet Union may not
be as serious as those found in Africa, but how can we provide any
effective treatment in Eastern Europe and the Former Soviet Union with
such small funding allocations?
Answer. Your concerns about HIV/AIDS in the Europe and Eurasia
(E&E) region are well founded. Though overall prevalence in E&E is low,
the world's steepest rise in new HIV infections is in this region,
particularly Russia and Ukraine. The epidemic is driven primarily by
injecting drug use and exacerbated by a host of factors including
increased rates of sexually transmitted infections, cheap drugs,
expanded prostitution, and human trafficking.
The Administration has recently re-emphasized its commitment to
combating HIV/AIDS in the E&E region, including a report by the
National Intelligence Council, two Chiefs of Mission meetings in Kiev
and Moscow, and a strong statement by Secretary Powell in Moscow in
May.
USAID's commitment to combating HIV/AIDS in E&E is demonstrated by
our Agency maintaining levels of HIV/AIDS funding in the face of
overall decreases in the FREEDOM Support Act and SEED Act accounts. In
the E&E region, total HIV/AIDS funding for fiscal year 2003 is expected
to total $19.4 million ($11.6 million from the FREEDOM Support Act
account, $1.8 million from the SEED Act account, and $6.0 million from
the Child Survival and Health account.) A slight increase is
anticipated for fiscal year 2004.
At the present time, locally funded programs and those supported by
USAID and other donors are reaching only a fraction of the high risk
groups that must be reached if the epidemic is to be controlled. Of
course, more resources for HIV/AIDS could be put to good and immediate
use in Europe and Eurasia. However, it would be a mistake to
shortchange other urgent health needs such as tuberculosis in order to
plus up HIV/AIDS funding. Consequently, USAID continues to strive to
use our scarce HIV/AIDS resources in the most effective ways possible.
In the priority countries of Russia and Ukraine, USAID missions are
finalizing revised HIV/AIDS strategies, and the Agency is taking a
fresh look at regional E&E programs as well. USAID will continue to
focus on prevention programs directed at those most at risk--while also
expanding our programs of treatment, care and support. Programs to
prevent maternal to child transmission have already demonstrated their
effectiveness. The U.S. Government also must continue to urge the
leaders of Europe and Eurasia to engage the HIV/AIDS epidemic with
increasing vigor.
Given our budget realities, USAID is working to leverage other non-
U.S. Government resources. With USAID technical assistance, twelve E&E
countries have been awarded nearly $250 million in grants from the
Global Fund Against HIV/AIDS, Tuberculosis and Malaria.
While USAID will continue to focus its global HIV/AIDS resources in
high prevalence countries outside of Europe and Eurasia, I agree with
you and want to underscore the need to aggressively address the
epidemic in Europe and Eurasia now, before the window of opportunity
slams shut. I echo the theme of the Kiev Chiefs of Missions meeting
when I say that low prevalence should not mean low priority.
FUNDING FOR ROMANIA
Question. Mr. Natsios, I am pleased to know you recently returned
from Romania. Romania is a country that has overcome a repressive
dictatorship to hold four national elections and implement market
reforms. Additionally, Romania is poised to gain NATO admission this
year. Furthermore, Romania has been a tremendous ally to the United
States in Desert Storm, Kosovo, Afghanistan, and Iraq. Romania has
contributed well over 1,000 troops to the war on terrorism. Moreover,
Romania has made itself home to 5,000 U.S. Marines in the war on
terrorism. In good times and in times of need for the United States,
Romania has been more than a reliable ally.
Despite the positive steps Romania has taken, Romania still
requires our assistance to make its economic reforms, child-welfare
reforms, and democratization efforts fully take hold, not just spread a
few feeder roots.
Why are we cutting development funds [from] Romania, a reliable
ally, at a time when they need our assistance to solidify their
reforms?
Answer. We agree that much still needs to be done in Romania, and
we are making excellent progress, despite very limited resources.
Although the Administration initially debated setting a graduation date
for Romania, none has been established. The current plan for U.S.
assistance to Romania calls for maintaining present funding levels of
about $28 million annually (or perhaps modestly increasing that level)
through fiscal year 2008. Despite significant improvements by Romania
over the past two years in macro-economic performance, economic reform
and democratization, Romania still has much to do to improve its
governance, transparency and other development and transition
objectives. We will continue to monitor Romania's progress toward
graduating from U.S. assistance to see whether a date can be set to end
U.S. bilateral assistance funding.
Question. How do you determine when a country ``graduates'' from
USAID assistance? Is it common to permit countries to ``graduate'' with
incompletes? The Millennium Challenge and your testimony state that we
are committed to those countries headed in the right direction and
assisting us in the war on terrorism. It seems Romania has taken all
the right steps, only to be undercut by the United States. We let
Romania down after WWII and allowed the Soviets to take-over. Let's not
do so, again.
Answer. The date for graduation from U.S. assistance is set when
our analysis finds that a country is expected to be able to sustain
progress towards democracy and an open market orientation without
substantial further U.S. Government assistance. The analysis includes a
review of country-specific program indicators designed to define
graduation potential, standardized indicators of country progress, and
a wide range of consultations with various USG agencies and political
leaders. Even after graduation, a country may receive relatively small
amounts of assistance from bilateral funding or regional funds to help
it redress limited areas where deficiencies persist.
In at least one of the eight countries where bilateral SEED funding
ended, there was controversy over whether the graduation targets had
been achieved. In that case and several others, some USG assistance
continued, albeit at levels significantly below those before
graduation. All countries where USAID bilateral missions have closed
are now considered to have progressed beyond the need for further
substantial SEED assistance.
USAID DISASTER ASSISTANCE RESPONSE TEAMS
Question. The USAID has dispatched DARTs to Iraq.
How many DARTs are there in Iraq? How many people comprise a DART?
What are the responsibilities of DARTs? Are the DARTs spread
geographically throughout Iraq, or are they centralized in Baghdad?
Answer. There is one Disaster Assistance Response Team (DART) in
the Persian Gulf region, which is divided into four regional teams. All
members of each team are a part of the same DART.
The size and responsibilities of a DART vary depending on the type,
size, and complexity of disasters to which the DART is deployed.
USAID's Office of U.S. Foreign Disaster Assistance (OFDA) developed the
DART as a method of providing rapid response assistance to
international disasters, as mandated by the Foreign Assistance Act. A
DART provides an operational presence on the ground capable of carrying
out sustained response activities. This includes coordinating
assessment of the situation, recommendations and advice on U.S.
Government response options, and funding and management of on-site
relief activities.
As of July 9, 2003, there are a total of 27 DART members in the
Gulf region. Of these 27 DART members, 19 are in Iraq, including 10 in
Baghdad, 6 in Arbil (northern Iraq), and 3 in Al Hillah (central Iraq).
In addition, eight DART members are located in Kuwait City. These
numbers fluctuate as the DART members travel and respond to needs in
the region.
FUNDING FOR MICRO-ENTERPRISE
Question. The fiscal year 2004 budget request seeks $79 million for
funding of micro-enterprise efforts globally. $79 million was funded in
fiscal year 2002 and fiscal year 2003, so there has been no increase in
funding for a program that produces great results.
How many countries is USAID involved in micro-enterprise efforts?
How does USAID determine how long it will fund micro-enterprise in a
country before focusing efforts on a new country? What countries are in
the pipeline to receive micro-enterprise assistance?
Answer. In fiscal years 2002 and 2003, USAID funded micro-
enterprise activities in about 50 countries in the Africa, Latin
America and Caribbean, Asia and Near East and Europe and Eurasia
regions. USAID obligations over the last 3 years, from all funding
accounts, have a generally averaged around $150 million. In fiscal year
2001, our obligations were at $158 million. In fiscal year 2002, the
funding level exceeds $170 million. Most of USAID's micro-enterprise
programs range from 3 to 5 years, depending on the nature of the
activity.
Institutional development programs tend to take longer; policy
reform efforts usually are somewhat shorter. In some countries, there
have been numerous micro-enterprise projects. Countries such as
Bolivia, Honduras, Mali, Kenya, Bangladesh, Indonesia, for example,
have had micro-enterprise projects since the 1980's. In the coming
year, USAID is planning to undertake micro-enterprise activities in
some new countries, such as Afghanistan, Yemen and Iraq.
UNIVERSITY FUNDING DIRECTIVES
Question. Over the past three years, this Committee has included
several Committee directives on funding requests for Universities
within the Bilateral Economic Assistance Account. To my knowledge these
directives have not been followed. In fact, this Committee has included
strongly worded language directing the Committee to adhere to these
funding initiatives, but still to no avail.
Why does USAID continue to ignore this Committee's directives? In
particular, why has USAID not funded the following Louisiana State
University programs, which have received commendation from this
Committee--the Emergency Management Program, the Namibia Mariculture
Program, and the Latin American Commercial Law Program?
Answer. USAID has not ignored the Committee's directives. Two years
ago USAID established a Higher Education Community (HEC) Liaison
position in its Office of Education in the Bureau for Economic Growth,
Agriculture and Trade. Martin Hewitt now serves as the HEC liaison and
is the key point of contact for universities seeking information and
advice on the opportunities and programs within USAID.
For tracking and management of unsolicited concept papers and
proposals, the HEC Liaison is supported by a working group within the
Agency. This working group is composed of representatives from the
regional and technical bureaus. The working group shares the
responsibility for either reviewing the proposal in the regional or
technical office (if the proposal is technical or sector specific with
no country cited) or for distribution to a USAID Mission (if the
proposal is explicit regarding a country where the planned activity
will be conducted). The working group shares the responsibility for
tracking the status of higher education proposals with the HEC Liaison.
The group communicates frequently to ensure that the improvements in
procedures and information flow are achieving their desired results.
In the House Appropriations Committee Report 107-663 and the Senate
Appropriations Committee Report 107-219, Congress included the
requirement that USAID report on the status of 68 university proposals
listed in the House and Senate reports.
The following actions have been taken concerning university
proposals:
--The HEC Liaison sent e-mails to every higher education institution
mentioned in the University Programs section of the Senate and
House Reports to direct them toward information about Agency
solicited competitive processes and opportunities. (Ten of the
universities mentioned submitted applications to the University
Partnerships competitive grant program).
--The HEC Liaison made personal telephone calls to thirty higher
education institutions listed in the Senate and House Reports
to ascertain the status of their proposal submissions and to
provide guidance.
--The HEC Liaison has been contacted by at least thirty higher
education institutions to request information about guidelines
for developing concept papers, proposals, and for information
about how the review process works (if the proposal aims to
work in a particular USAID/Mission, then the proposal is shared
with the Mission for review, if not, the proposal is reviewed
in a technical or regional bureau). Every call or e-mail from
higher education institutions to the HEC Liaison is responded
to in an informative and timely way.
--The HEC Liaison has participated in numerous conferences, meetings,
site visits, regarding the USAID-University relationship and
the specifics for how Universities can address Agency policies,
programs, projects and obtain support for doing so.
Following is the status of university proposals mentioned in the
House and Senate Reports (June 23, 2003):
------------------------------------------------------------------------
Total number of universities cited......................... 58
Total number of proposals cited............................ 68
Number of proposals received............................... 37
Number not received........................................ 31
Of those received:
Number of proposals approved........................... 17
Number rejected........................................ 12
Number under review.................................... 8
Total proposal funding (millions of dollars)............... 15
------------------------------------------------------------------------
Summary:
(1) 54 percent of proposals mentioned in the House and Senate
Reports have been received.
(2) 46 percent of proposals received have been funded.
(3) 32 percent of proposals received have been rejected.
(4) 22 percent of proposals received are under review.
The 17 successful proposals were approved because they met the
review criteria contained in USAID's brochure and website U.S. Higher
Education Community: Doing Business with USAID. The criteria include
two, which bear on the proposed activities' consistency with foreign
policy and development goals. They are: the extent to which the
proposal supports USAID's mandate and objectives, and the anticipated
long-term impact of the project and the nature of the on-going
relationship between institutions.
The major reasons that the twelve proposals were rejected included:
--The failure to meet or support USAID's mandate or objectives in the
country, region, or sector
--The duplication of ongoing efforts
--Budget limitations in targeted bureaus, countries
--Lack of technical merit
In each case where proposals were rejected, a letter was sent to
the applicant informing them of the reasons why the proposal was not
accepted.
As regards the three Louisiana State University programs which you
cite:
1. The Namibia Mariculture Program. This proposal was rejected
because the Namibia Mission was at the time scheduled for closing.
2. The Latin America commercial law program. This proposal has not
been received. USAID called Louisiana State in January and was informed
that the University might send a proposal. To date no proposal has been
received.
The other Louisiana State University program cited in the Foreign
Operations Report is: A proposal to provide independent media training
to local government officials from developing countries. This proposal
has not been received.
HIV/AIDS IN AFRICA
Question. Within the armies and militias in West and Central Africa
and particularly in the Democratic Republic of Congo, Angola, and other
areas of recent and current conflict, HIV/AIDS has a higher prevalence
within the soldier population than in the general population. This is a
particular problem with ``child soldiers''. USAID has few programs that
directly interface with this important sector of African society. How
can USAID work more effectively to integrate intervention strategies
with those entities that deal with active and demobilizing military
groups? Is a policy or legislative change necessary to permit USAID to
work directly with host country military personnel? Is USAID
considering working with universities and the West African Health
Organization (WAHO) to address the HIV/AIDS crisis within the military
and former military populations in Africa? After all, WAHO is the only
ECOWAS endorsed organization able to deal with complex regional,
individual and organizational change. Has USAID contemplated giving
support to increase the institutional strength of WAHO in order to
create a coordinated and sustainable long-term solution to the problem?
Answer. USAID currently supports this newly constituted
organization through its West Africa regional program. USAID is
building the capacity of WAHO through technical assistance to develop a
new agenda for health in West Africa, training in strategic planning
and program design.
Question. The United States is committing unprecedented funds,
along with the United Nations and the Global Fund, to combat HIV/AIDS
in Africa. That is encouraging news, but we are already seeing a
shortage of available international public health workers. The
additions of retro-virals to the existing public health program, which
require an even higher level of management, create further demands.
Even where we have cheap effective reliable drugs to deal with the
disease, as in the case of malaria, the lack of human and physical
health infrastructure cripples intervention efforts. There needs to be
a program to create trained American and African intervention
management specialists of enormous size to manage this problem. What
plans does USAID have in mind to reinforce and strengthen African
educational institutions to rapidly respond to this set of challenges?
Answer. USAID is currently developing a human capacity strategy to
address the extreme shortage of the trained personnel needed to mount a
sustained response to the HIV/AIDS pandemic. This plan will include
expanding the capacity of African educational institutions to provide
additional training to existing cadres of health workers as well as
developing pre-service training for new health professionals, and
manpower planning for national and local governments.
Question. Given the millions killed during the Congo/Rwanda
conflict, the many people with HIV/AIDS, and, particularly, the number
of demobilizing HIV positive ``child soldiers'' in the country, why
isn't the Democratic Republic of Congo (DRC) on the target list of
countries for major intervention efforts by the United States? Given
the leading role of that country from the first days of the pandemic
and the number of trained, senior research and public health
specialists working in Kinshasa, which I understand is more specialists
than the rest of Africa, this seems to be a contradiction. Does USAID
have any plans for responding to the needs of the Democratic Republic
of Congo, major strategic country in Central Africa?
Answer. USAID is committed to addressing the HIV/AIDS pandemic in
the Democratic Republic of the Congo (DRC). This commitment is
reflected in the HIV/AIDS fiscal year 2004 control level of $5,000,000,
which constitutes a 25 percent increase over the fiscal year 2003 HIV/
AIDS funding level of $4,000,000. USAID's response to the HIV/AIDS
epidemic in DRC takes into account the fact that HIV transmission is
fueled by war-related factors.
CONCLUSION OF HEARINGS
Senator McConnell. Thank you all very much for being here.
That concludes our hearings.
[Whereupon, at 3:24 p.m., Thursday, June 5, the hearings
were concluded, and the subcommittee was recessed, to reconvene
subject to the call of the Chair.]