[Senate Hearing 109-]
[From the U.S. Government Publishing Office]



 
  STATE, FOREIGN OPERATIONS, AND RELATED PROGRAMS APPROPRIATIONS FOR 
                            FISCAL YEAR 2007

                              ----------                              


                         THURSDAY, JUNE 8, 2006

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 3:04 p.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Mitch McConnell (chairman) 
presiding.
    Present: Senators McConnell, Brownback, and Leahy.

           UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT

STATEMENT OF HON. RANDALL L. TOBIAS, ADMINISTRATOR

             OPENING STATEMENT OF SENATOR MITCH MC CONNELL

    Senator McConnell. Okay, why don't we get started?
    Welcome, Ambassador Tobias. As you wear two hats these 
days, as the administrator of the U.S. Agency for International 
Development and director of Foreign Assistance at the State 
Department, this hearing will examine the President's fiscal 
2007 budget request for USAID and the administration's efforts 
to reform foreign assistance.
    I know my colleagues are keen on asking questions on 
specific programs and activities, and will, therefore, make 
only a few brief opening observations.
    Let me begin by expressing this subcommittee's support for 
your efforts to improve the efficiency and effectiveness of 
U.S. foreign assistance programs and activities. We're aware of 
the significant achievements of the President's emergency plan 
for AIDS relief under your leadership, and I expect you have 
the gratitude of millions of HIV-positive people across the 
globe for getting that important initiative up and running. 
This was certainly no small achievement, and we wish you 
similar success with your new responsibilities.
    According to the budget justification materials, the fiscal 
2007 request for USAID programs and activities totals $3.9 
billion, a decrease of $371 million below last year's enacted 
level. As I'm sure you're aware of the strong congressional 
interest in health and development programs, it would be 
helpful if you could explain the rationale for the decrease in 
the Child Survival and Health Programs Fund and Development 
Assistance accounts. I'm specifically interested in the impact 
the reduction will have on USAID's democracy activities and 
programs that promote economic growth, agriculture, and trade.
    With respect to foreign aid reform, the subcommittee would 
appreciate an update on the administration's efforts up to this 
point. We've tried, over the years, to underscore the 
importance of foreign assistance programs to U.S. security 
interests overseas. Our country learned, at great cost, that 
ungoverned spaces, such as those that allowed al Qaeda to train 
in Afghanistan, pose great risk to our way of life, and that 
all elements of our national power--military, economic, and 
diplomatic--must be integrated if we are to prevail in the long 
struggle against Islamic extremists.
    Be it through assistance to countries at risk of increasing 
acts of terrorism, like Indonesia or the Philippines, or 
assisting representative governments that will directly 
contribute to regional stability, such as in Afghanistan and 
Iraq, the allocation of our assistance resources should support 
strategic objectives.
    It is important to underscore two basic assumptions 
underlying any foreign aid reform effort.
    First, programs must support policy. For this reason, the 
Senate recommended a new Democracy Fund account last year, the 
purpose of which was to consolidate all democracy programs and 
activities under a single account. I'm pleased that the 
President made the expansion of freedom abroad a major 
component of America's foreign policy, but, to succeed, USAID 
and the State Department will need to coordinate all of our 
programs and policy in support of the national security 
strategy to a degree this subcommittee has, frankly, yet to 
see. I hope, under your leadership, that will be the case.
    Second, given limited resources, our assistance must be 
prioritized to those countries important to U.S. national 
interests. Frankly, this is sometimes out of kilter in the 
budget request. For example, in fiscal 2007, only $733,000 is 
requested for democracy and government programs in the People's 
Republic of China, while $4 million is requested for similar 
programs in the Democratic Republic of Timor-Leste. Need I say 
more? I can assure you that democracy programs for China will 
be significantly increased as the legislative process moves 
forward.
    So, thank you for being here today, Mr. Ambassador. With 
that, I'll turn it over to my friend and colleague Senator 
Leahy.

                 STATEMENT OF SENATOR PATRICK J. LEAHY

    Senator Leahy. Thank you, Mr. Chairman.
    Ambassador Tobias, you had a nice writeup in the Wall 
Street Journal yesterday. I think you deserved it. We're going 
to spend an hour or so to cover the entire world of USAID's 
programs, so I'm going to put most of my statement in the 
record.
    I join the chairman in welcoming you to this subcommittee 
for the first time as both USAID Administrator and Director of 
Foreign Assistance. I also want to thank you for the job you 
did as the Global AIDS Coordinator. My impression is that you 
got that program off to a good start, despite some less-than-
helpful constraints in the law. Fighting AIDS is different from 
other problems you're going to face now: reforming 
dysfunctional judicial systems, building potable water systems, 
responding to famines or hurricanes, stopping deforestation, 
supporting nascent political parties, providing economic 
alternatives for opium growers, and building democratic 
institutions and market economies. Your new role will require 
more interaction with Congress. While the chairman and I tried 
to bring out a bill that had strong bipartisan support, we 
still have 100 different views here. Then you go across the 
street to the House, and there's another 435. The President's 
priorities are often ours, but not always. So, you have to 
balance presidential priorities and congressional ones.

                           PREPARED STATEMENT

    I will put the rest of my statement in the record, because 
I really would like to hear from you, and then I'll have some 
questions.
    [The statement follows:]
             Prepared Statement of Senator Patrick J. Leahy
    Ambassador Tobias, we have 90 minutes to cover the entire world of 
USAID's programs, so I will be very brief.
    I join Chairman McConnell in welcoming you to this Subcommittee for 
the first time as USAID Administrator and as the Director of Foreign 
Assistance. I also want to thank you for the job you did as Global AIDS 
Coordinator. My impression is that you got that program off to a good 
start, despite some less than helpful constraints in the law.
    Yours is a heavy responsibility. While your previous role involved 
some of the same countries and problems, fighting AIDS is different 
from reforming dysfunctional judicial systems, building potable water 
systems, responding to famines or hurricanes, stopping deforestation, 
supporting nascent political parties, or providing economic 
alternatives for opium growers.
    Building democratic institutions and economic systems that offer 
real opportunities for people to improve their lives within a just 
society, presents unique, long term challenges and opportunities.
    Your new role will also involve more interaction with the Congress 
than you are accustomed to. Some of it may not always be welcome, 
because in the Senate we have 100 different points of view of what's 
wrong in the world and what USAID should do about it. And you also have 
to deal with the House.
    I hope you understand that the way we get this bill passed is by 
balancing the President's priorities with the Congress's priorities. 
They are often the same, but not always. Let me give you some friendly 
advice: don't forget who pays the bills.
    You have already discovered that USAID has outstanding people. But 
its staff is a fraction of the number that are needed to effectively 
manage programs in so many countries with so many problems. It is also 
plagued by burdensome and self-defeating procurement and contracting 
procedures that one might expect to find in Russia, but not here. I 
want to know--not today but soon--how you plan to fix these problems.
    I have long believed that the United States needs a Director of 
Foreign Assistance. We need far better coordination, and I only wish 
your oversight extended to the international programs of other agencies 
besides State and USAID, like the Departments of Agriculture and 
Energy, the U.S. Foreign Service and the CDC. At the same time, there 
are good reasons for USAID's autonomy, and we want to protect it.
    I am concerned that there has not been nearly enough consultation 
with the Congress about your position or the Secretary's 
``transformational diplomacy'' initiative. Your testimony today does 
not give us much more than the vague generalities we have heard 
already. One thing we have learned over many years is that when it 
comes to foreign policy and foreign assistance, real reform is 
difficult and it doesn't happen unless the Congress is fully on board.
    We know what the problems are and there is a lot we can do to make 
our foreign assistance programs more effective. But we have to work 
together, from the beginning, which has not been the practice of this 
Administration. I hope this will be different because there is a lot at 
stake for all of us.
    Thank you Mr. Chairman, and thank you Ambassador Tobias for being 
here.

    Senator McConnell. Thank you, Senator Leahy.
    Mr. Ambassador, why don't you tell us what you think we 
need to know without reading a very lengthy statement--that 
would be appreciated--and we'll get to the questions.

              SUMMARY STATEMENT OF HON. RANDALL L. TOBIAS

    Ambassador Tobias. Thank you, Mr. Chairman. Thanks for the 
opportunity to testify before the subcommittee today.
    I want to begin by expressing my appreciation to you, Mr. 
Chairman and to Senator Leahy, for your guidance and support in 
my former role as U.S. Global AIDS coordinator, and to thank 
you for your commitment both to that and to our foreign 
assistance programs. I look forward to working with both of 
you, and with the other members of the subcommittee, in my new 
capacity.
    My first couple of months as USAID Administrator have 
reinforced my belief that the men and women of the Agency are 
motivated by a true sense of mission and commitment, and I'm 
eager to do all that I can to sustain their dedication and 
ensure that their experience and capabilities are fully engaged 
as we embark on reforming our approach to foreign assistance.
    I have submitted a more detailed statement for the record, 
but I would like to focus some very brief opening remarks on 
the administration's reform of foreign assistance for fiscal 
year 2007 and beyond. Beyond the discussions that we're going 
to have in a few minutes, my staff and I certainly stand ready 
to address any detail of the fiscal year 2007 budget request 
with you or your staff as we go forward.
    Secretary Rice launched her Transformational Diplomacy and 
Development Initiative in January to address the incoherence 
and lack of focus in our foreign assistance programs. In doing 
so, she noted that both the content and the organization of 
foreign assistance require adjustment to meet the new 
challenges of today's world. The Secretary noted that ``The 
current structure of America's foreign assistance risks 
incoherent policies and ineffective programs, and perhaps even 
wasted resources. We can do better, and we must do better.'' 
Today, I want to commit to you that we will do better.
    In our current environment, the locus of national security 
threats has shifted to the developing world, where poverty, 
oppression, and indifference are exploited by our foes to 
provide haven for terrorists and the preparation of terrorist 
acts. As you have recognized with your attention to democracy 
programs, Mr. Chairman, foreign assistance can be an effective 
tool for countering these new threats. For this reason and 
others, foreign assistance has become a foundational pillar of 
our new national security architecture.
    As you know, under the reform initiative, the President has 
appointed me to be the Director of U.S. Foreign Assistance, in 
addition to my Senate-confirmed position as Administrator of 
USAID. The President and the Secretary have assigned me the 
task of bringing greater strategic coherence to our planning, 
our budgeting, and our implementation of foreign assistance. I 
intend to do this first by focusing on our three greatest 
challenges: the lack of strategic focus in our programs, our 
fragmented budgeting process, and our inability to adequately 
track, transparently and in sufficient detail, where our 
funding goes, all problems that I know the Congress has 
recognized for some time.
    First, as your staffs have been briefed, we have begun to 
introduce a new strategic framework to bring focus to the 
foreign assistance funding appropriated to both the Department 
of State and to USAID. The framework establishes a set of broad 
objectives for foreign assistance that will help transform 
countries into better, more effective partners to create a 
safer and more just international system.
    On the country level, this framework serves as a roadmap, 
guiding programming to help us achieve our overall goals. Here 
in Washington, with essential input from Congress, the 
framework will more clearly establish the goals toward which 
foreign assistance will be directed, and the measures by which 
we will track progress. Under the leadership of each of our 
ambassadors, U.S. Government country teams in the field will 
define the activities for which funds will be used to most 
effectively pursue those goals. These plans will then be 
reviewed in Washington for their consistency with overall goals 
and expectations, with funds allocated only after the plans are 
approved. It is my expectation that this approach will not only 
help us better manage foreign assistance, but will also help 
Members of Congress perform their oversight responsibilities 
more effectively.
    Second, with this framework in place, budgetary decisions 
and program funding proposals will be weighed against how they 
contribute to the overarching goal the Secretary has set for 
helping countries become more effective partners.
    Finally, we will track where the money goes, including the 
results it is producing. As you know from your experience in 
working with me on the President's Emergency Plan for AIDS 
Relief, I have placed a great deal of emphasis on transparency 
for our funding, and I want to do the same for all of foreign 
assistance.
    It is our intent to produce joint country plans for 35 
countries for fiscal year 2007 that we can share with you in 
February. By August 2006 we aim to have our new information 
system in place to begin to collect and track this data.
    Beyond this more strategic approach to planning and 
budgeting and the transparency we intend to provide, I also 
want to improve our responsiveness at USAID to the Congress in 
other ways. So, beginning today, I want to commit that USAID 
will provide answers to you for your information requests 
within 48 hours, and to formal letters within a week, or when 
that is not possible, we will be in touch with your offices 
within those timeframes to explain the reasons why and to work 
with you to establish a reasonable schedule that we will then 
meet. Along the same lines, I want to also commit to delivering 
congressional reports on time to enable you to do your 
necessary oversight to make our programs stronger.
    As articulated by both President Bush and by Secretary 
Rice, we are entering a new era of foreign assistance where our 
resources will be better aligned with our strategic priorities. 
We will be more accountable to the American taxpayers, and use 
their resources more efficiently and effectively.
    None of this will be easy. But, in recognition of the fact 
that our future as Americans is inextricably linked to those we 
seek to assist, we must be certain that our investments are 
producing the greatest results at the lowest cost to the 
taxpayers, and we will need the help of the Congress to achieve 
this aim.
    On a final note, Mr. Chairman, as you know, Abu Musab al-
Zarqawi was killed in Iraq yesterday by U.S. Armed Forces. 
President Bush noted that ``The ideology of terror has lost its 
most visible, aggressive leader.'' What I want to note here is 
that in 2003 al-Zarqawi was convicted in absentia and sentenced 
to death by a Jordanian court for masterminding the 2002 
assassination of Laurence Foley, a USAID official in Jordan. 
The death of Laurence Foley was but one of al-Zarqawi's many 
awful crimes, but I can think of no better way to articulate 
the deep connection between foreign assistance and our Nation's 
fortunes in the world. The people who carry out our foreign 
assistance programs are literally on the front lines in the 
battle between hope and darkness. We must all take very 
seriously the responsibility to enable them to manage the best 
and most efficient programs possible.
    Thank you very much, Mr. Chairman. I look forward to 
addressing your questions.
    [The statement follows:]

              Prepared Statement of Hon. Randall L. Tobias

    Thank you, Mr. Chairman, for the opportunity to testify before the 
Subcommittee today on the fiscal year 2007 USAID budget.
    I want to express my appreciation to you, Mr. Chairman, and to you, 
Senator Leahy, for your guidance and support in my former role as U.S. 
Global AIDS Coordinator and to thank you for your commitment to our 
foreign assistance programs. Your attention to strengthening democracy, 
Chairman McConnell, and your commitment to augmenting the voice of the 
disenfranchised, Senator Leahy, have helped citizens hold their 
governments more accountable across the globe. I look forward to 
working with you both, and with the other Members of the Subcommittee, 
in my new capacity as Director of U.S. Foreign Assistance and 
Administrator of USAID.
    My first couple of months as USAID Administrator has reinforced my 
belief that the men and women of the Agency are motivated by a true 
sense of mission and commitment. I am eager to do all that I can to 
sustain their dedication and to ensure that their valuable experience 
is brought to the table as we embark on reforming our approach to 
foreign assistance.
    I just returned from two weeks of travel through Pakistan, then 
Afghanistan, and Iraq--where hundreds of brave USAID employees put 
their lives on the line every day in an effort to help people in 
nascent democracies build a free and prosperous future for themselves. 
As I traveled through the region, the full range of USAID programming 
was on display, from the humanitarian intervention in societies ravaged 
by natural disasters to the reconstruction of societies ravaged by 
tyranny and war; from efforts to secure peace and security to efforts 
to invest in people and help them build richer fuller lives for 
themselves.
    The message I took to President Musharraf of Pakistan and President 
Karzai of Afghanistan, as well as to President Jalal Talabani, Prime 
Minister Nuri al Maliki, and the newly-formed government of Iraq was of 
our commitment to a long-term strategic partnership between the United 
States and their countries.
    Democracy is taking root in Afghanistan and Iraq and the leaders I 
met are committed to a new direction for their countries. We are seeing 
some economic progress and through programs like Afghans Building 
Capacity--a multi-year investment of up to $125 million that amounts to 
the largest and most comprehensive such USAID effort in perhaps 20 
years anywhere in the world--we will assist the Government and the 
people of Afghanistan as they develop the physical and human capacity 
in the public sector, private sector and civil society to sustain 
growth both in Kabul and the provinces.
    I recognize that my testimony this afternoon will be somewhat 
different from traditional budget testimony. I will briefly review the 
fiscal year 2007 budget request for USAID, but will focus my testimony 
on the Administration's reform of foreign assistance for fiscal year 
2007 and beyond. In addition to the discussion we are going to have 
today, my staff and I stand ready to address any detail of the fiscal 
year 2007 budget request with you and/or your staff after this hearing.

                        FISCAL YEAR 2007 BUDGET

    The fiscal year 2007 program budget continues efforts to build 
democracy, good governance and economic growth in Iraq and Afghanistan, 
and requests funds in support of other frontline states in the Global 
War on Terror. USAID will play a critical role in the Provincial 
Reconstruction Teams that will be deployed throughout Iraq and 
Afghanistan. In Sudan, we are well on our way to standing up a mission 
in Juba. This will enhance our influence in helping move the country to 
peace, reconciliation and a better future.
    USAID is requesting $3.15 billion for its fiscal year 2007 
programs. In addition, we anticipate working with the Departments of 
State and Agriculture on joint programs that total $5.4 billion in 
Economic Support Funds (ESF), Assistance for the Independent States of 
the Former Soviet Union (FSA), Assistance for Eastern Europe and the 
Baltic States, the Andean Counternarcotics Initiative and Public Law 
480 Title II. We will also manage a portion of the $2.9 billion 
requested for the Global HIV/AIDS Initiative by the Global AIDS 
Coordinator and a portion of the $3 billion for the Millennium 
Challenge Corporation. USAID is requesting a total of $679 million for 
Operating Expenses and $132 million for contributions to the Capital 
Investment Fund.

ENHANCING THE IMPACT OF FOREIGN ASSISTANCE: REDUCING INEFFICIENCIES AND 
                              INCOHERENCE

    Secretary Rice launched her Transformational Diplomacy and 
Development initiative in January to address the incoherence and lack 
of focus in our foreign assistance programs. In doing so, she noted 
that both the content and organization of foreign assistance require 
adjustment to meet the challenges of today's world. The Secretary 
noted, ``The current structure of America's foreign assistance risks 
incoherent policies and ineffective programs and perhaps even wasted 
resources. We can do better and we must do better.'' Today, I want to 
commit to you we will do better.
    Under the previous USAID and State organizational structure, each 
agency maintained independent budgeting and planning offices to focus 
on their own part of foreign assistance. This required two staffs to 
develop multiple and parallel iterations of their individual budgets in 
the same program areas, two staffs to agree to and integrate a set of 
numbers, two staffs to brief the Hill, and a myriad of programs that 
may be redundant--or worse, at cross purposes. While each agency 
collaborated with the other, in spite of the best efforts of the people 
involved, it was done at great cost in time, personnel, and impact.
    Of great concern to me--and I know to many of you--is the inability 
of our Washington information systems to capture ``all-spigots'' 
funding levels across sectors or in a variety of other dimensions--
information that is vital to the oversight work of both Congress and 
the Administration. I know it will not be easy, but we need to bring 
transparency and accountability to explaining the use and result of our 
foreign assistance funds.
    I realize that as I outline the challenges we face, I do not need 
to convince you this afternoon of what we need to do. Congress has 
consistently called for improved transparency in the way budgets are 
put together and funds expended--and vastly improved accountability for 
the results. I simply want to emphasize that I, too, am focused on that 
goal, and that I look forward to working with you in achieving it.
    In our current environment, the locus of national security threats 
has shifted to the developing world, where poverty, oppression, and 
indifference are exploited by our foes to provide haven for terrorists 
and the preparation of terrorist acts. As I know you have recognized 
with your attention to democracy programs, Mr. Chairman, foreign 
assistance is an effective tool for countering these new threats. For 
this reason and others, foreign assistance has become a foundational 
pillar of our new national security architecture.

                    OUR APPROACH: WE WILL DO BETTER

    As you know, under the reform initiative, the President has 
appointed me to be Director of U.S. Foreign Assistance, in addition to 
my Senate-confirmed position of Administrator of USAID. The President 
and Secretary Rice have assigned me the task of bringing strategic 
coherence to our planning, budgeting and implementing of foreign 
assistance. I intend to do this first by focusing on our three greatest 
challenges: the lack of strategic focus in our programs, our fragmented 
budgeting process, and our inability to track, transparently and in 
sufficient detail, where our funding goes--all problems I know that 
Congress has recognized for some time.
    First, as your staffs have been briefed, we have introduced a new 
Strategic Framework for foreign assistance appropriated to both the 
Department of State and USAID. This framework establishes a set of 
broad objectives for foreign assistance that will help transform 
countries into better, more effective partners to create a safer and 
more just international system. We believe that this goal of 
transforming countries can be accomplished if we focus on five 
objectives: achieving and maintaining peace and security; helping 
improve governance and democratic participation; contributing to and 
promoting investments in people; helping engender economic growth; and 
maintaining our commitment to respond to humanitarian disasters.
    At the country level, where the ``rubber of our programs meets the 
road,'' this Framework serves as a ``roadmap,'' guiding programming to 
help us achieve our overall goals. My intent is that we here in 
Washington--with essential input from Congress--will more clearly 
establish the goals toward which our foreign assistance will be 
directed and the measures by which we will track progress. Then, under 
the leadership of each of our Ambassadors, country teams in the field 
will define the activities for which funds will be used to most 
effectively pursue those goals.
    With their expert knowledge of country circumstances, our staff in 
the field will produce better integrated, more coherent country 
operational plans that indicate, for each activity, the partner, the 
amount of money, the expected outputs, and ultimate outcomes that will 
contribute most effectively to achieving the established goals.
    The country operational planning approach differs from the status 
quo in that all assistance agencies in country will work together as a 
country team to identify unified resources, both human and financial, 
to bring to bear on the goals and performance targets of each sector of 
assistance planned to drive country reforms. This process produces a 
single USG document detailing our approach to assistance guided by 
strategic goals.
    These unified plans will be reviewed in Washington for their 
consistency with overall goals and expectations, with final allocation 
decisions made only after plans are approved. By requiring detailed and 
specific planning up-front, directly before fiscal year 2007 funds are 
appropriated, we hope to improve the strategic focus of our programs 
sooner and increase the speed their implementation.
    Second, with the Framework in place, budgetary decisions and 
program funding proposals will be weighed against how they contribute 
to the overarching goal the Secretary has set of helping countries 
become effective partners. To ensure that our budget staffs at USAID 
and State allocate funds according to this goal in an integrated and 
consistent way, I have joined them into one budget, performance 
planning and results monitoring organization, under my direction. By 
bringing this staff together into one office, we have begun to 
streamline processes, improve efficiency and effectiveness, and reduce 
the burden that redundant functions place on our field staff.
    Finally, we will track where the money goes, including the results 
it is producing. As you know from your experience in working with me on 
the President's Emergency Plan for AIDS Relief, I have placed a great 
deal of emphasis on transparency for our funding. To bring that same 
level of accountability to the rest of our foreign assistance spending, 
we are in the process of building a new strategic information system 
for USAID and State funds that will tell both you and me exactly who is 
receiving our funds, what they were doing with the money, what is 
expected as a result, and how that result will help us reach our goals.
    These changes represent a substantive shift in the planning, 
allocation, and programming of foreign assistance resources, including 
new responsibilities for both Washington and the field. Accordingly, 
this effort will remain a work in progress for some time, but we are 
moving as quickly as we can. It is our intent to produce joint country 
operational plans for USAID and State funds for 35 countries for fiscal 
year 2007 that we can share with you in February. By August 2006, we 
aim to have our new information system in place to begin to collect and 
track this data.
    Beyond this more strategic approach to planning and budgeting and 
the transparency we intend to provide, I also want to improve our 
responsiveness to the Congress in other ways. Beginning today, I want 
commit that USAID will provide you with answers to your informational 
requests within 48 hours and to formal letters within a week; or, when 
that is not possible, we will be in touch with your offices within 
those timeframes to explain the reasons why, and to work with you to 
establish a reasonable schedule for getting the information to you. 
Along those same lines, I also commit to delivering Congressional 
reports on time to enable you to do your necessary oversight to make 
our programs stronger.

                               CONCLUSION

    As articulated both by President Bush and by Secretary Rice, we are 
entering a new era of foreign assistance where our resources will be 
better aligned with our strategic priorities. We will be more 
accountable to American taxpayers and use their resources more 
efficiently and effectively.
    None of this will be easy. But in recognition of the fact that our 
future as Americans is inextricably linked to those we seek to assist, 
we must be certain that our investments are producing the greatest 
results at the lowest cost to the taxpayer. We will need the help of 
Congress to achieve this aim.
    Thank you very much, Mr. Chairman. I will be happy to answer any 
questions you may have.

    Senator McConnell. Thank you, Mr. Ambassador.
    I appreciate your reference to the big news of the day. 
There has not been a whole lot of good news in Iraq recently, 
but certainly the death of al-Zarqawi and the appointment of 
the defense and interior ministers gives us some hope that 
progress will continue to be made.

                            HEALTH PROGRAMS

    I want to shift to another subject entirely, and that's 
health programs. I've been a strong supporter of polio 
eradication programs, along with Senator Leahy and other 
members of this subcommittee. I was curious as to why the 
budget request includes no funding at all for programs related 
to polio eradication in Nigeria, a country which the World 
Health Organization has identified as of concern with respect 
to polio.
    Ambassador Tobias. Mr. Chairman, my understanding is that 
we had significant polio eradication activities in fiscal years 
2004 and 2005 in Nigeria. We spent about $10.5 million. In 
2006, we developed a number of concerns about both 
mismanagement and corruption in the system, although we did 
continue to fund programs using some money that was carried 
over. A number of changes have been made in Nigeria to tighten 
up the system. So, in 2007 we expect that USAID Nigeria will 
receive polio funds. The level will be decided later in the 
year. We will take into account the epidemiology, the current 
pipeline, the scope of USAID's role, what other donors are 
doing, what the Government of Nigeria is doing. But it's 
clearly a very serious issue there, and one that we need to be 
addressing.

                                 BURMA

    Senator McConnell. Thank you. I'm glad you're moving in 
that direction. I also want to turn to another country that I 
have a longstanding interest in, and that's Burma. I think we 
all know what the humanitarian situation is there, from 
significant HIV/AIDS infection rates to avian flu and now the 
potential for polio to re-emerge. While negligent in providing 
for the welfare of the Burmese people, the military junta that 
runs the place, the State Peace and Development Council (SPDC), 
is guilty of human rights abuses against ethnic minorities, 
including murder, torture, and rape.
    Now, we all understand the solution to Burma's humanitarian 
problems is political in nature; namely, reconciliation between 
Aung San Suu Kyi, and her political followers, who won the 
election in 1990, and the SPDC. In the wake of all this, what 
can the international community do to effectively address these 
Burmese health crises?
    Ambassador Tobias. Well, I think there are a lot of things 
that we can do, but we need to be sure that the things that we 
are doing are really supporting the people in need, and that 
we're doing it separate from the government in power there.
    Senator McConnell. They're basically running the NGOs out, 
aren't they? Denying them space----
    Ambassador Tobias. We have to find NGOs with whom we can 
work, who are working with Burmese both inside and outside the 
country. We're doing a number of things there, some from 
Thailand along the Thai/Burma border. But this is a situation 
that calls for creativity when the governments of countries are 
oppressing their people and not willing to step up to meet the 
needs of their people, and we have to find organizations that 
we can work with. That's exactly what we're trying to do.
    Senator McConnell. Are there some?
    Ambassador Tobias. Yes, I think there are. I'm certainly 
not an expert yet on the circumstances there, but I believe 
there are some organizations that we are working with, and can 
work with.

                                  IRAQ

    Senator McConnell. You mentioned Iraq. What is your 
perception of progress in Iraq, as measured by USAID programs, 
and the likelihood of such programs achieving some level of 
success?
    Ambassador Tobias. I just came back from Iraq about 2 weeks 
ago, and there is real progress being made, but there's a great 
deal more that can be done.
    Senator McConnell. You met with the Prime Minister, did you 
not?
    Ambassador Tobias. I met with the Prime Minister. I met 
with the President. I met with all of our military and civilian 
leadership on the ground. I'll tell you, one interesting 
experience I had was sitting in a room one day in a town 40 or 
50 miles south of Baghdad with a group of about seven or eight 
leaders of Iraqi NGOs. Now, just think about that in the 
context of somebody trying to start an NGO in the time of 
Saddam Hussein. These people were enthusiastically explaining 
what their organizations were doing. They had already figured 
out that if they created an association among themselves they 
could have more influence on the provincial government that was 
being put in place. It was the beginning of democracy really 
happening there.
    But one of the things that we need to do with our USAID 
programs, and I took some steps both while I was there and 
since coming back to do this, is, certainly, to be focused on 
the long term, but we also need to be focused on what I refer 
to as short-interval scheduling. So, what I have asked my 
people to do is take it 90 days at a time. What can we do, in 
the next 90 days, that can demonstrate real progress and 
demonstrate our support to the new Iraqi Government?
    I had a great conversation with General Corelli, the 
commander of the ground troops, about ways in which USAID and 
the military can collaborate in going into neighborhoods, 
starting in Baghdad, working on the last mile of connecting 
electric lines, water, sewer, cleaning up the garbage, trying 
to get neighborhoods back to a more habitable circumstance, 
where people can get back to their lives.
    Our people there are working under extraordinary 
circumstances. The security requirements are enormous just to 
move around. I'm very impressed and very proud of what they're 
doing. But I think there's more that we can do by focusing on 
some smaller projects more quickly.

                              AFGHANISTAN

    Senator McConnell. One more question, and then I'll turn to 
Senator Leahy.
    Bring me up to speed on how you feel you're doing in 
Afghanistan. Let me just say that when I first went there, in 
the fall of 2003, I had the typical country-team briefing. I 
never met a more enthusiastic bunch of Americans about, (a) the 
way they were being greeted, and (b) how successful they were. 
That was almost 3 years ago. Now we read reports that there's 
some backtracking, and that the Taliban are more of a problem 
than they were previously. So, I'm interested in whether the 
enthusiasm level is still high for your people there, and 
whether they still think they're making great progress.
    Ambassador Tobias. It is very high. I'm, again, very 
impressed with the morale and the commitment that our people 
there have. But I think it's a situation that could tip either 
way, and we need to ensure that we're continuing to do the 
things that need to be done.
    I met with President Karzai. I met with all of our own 
people, of course. I had some interesting experiences on the 
ground, including a meeting with a group of former poppy 
farmers, who, somewhat to my surprise, talked to me about how 
growing poppies is contrary to the teachings of the Koran and 
how they were eager to progress with our alternative-
livelihoods program. These were people who were being taught 
skills like pruning fruit trees and getting orchards back into 
shape and growing other crops. But it's more than that, it's a 
need for roads--probably that's the greatest need--and the need 
to develop markets. I also visited a USAID program where we are 
training people, who are going to all have jobs when they leave 
this training program, in some very basic construction skills 
of plumbing, working with electricity, building concrete-block 
walls, and some of those kinds of things.
    Senator McConnell. In that regard, during my trip to 
Afghanistan we had extensive discussions with Karzai and others 
about the need to get trees planted. Afghanistan has basically 
turned into a desert, because all the trees have been cut down. 
Has any reforestation effort been initiated? I know there are a 
number of American foundations that are interested in this 
issue.
    Ambassador Tobias. There's work going on in reforestation, 
which is a very pressing issue.
    There is a lot of focus on building new government capacity 
and capacity in the private sector, and getting citizens to 
understand the role that they can play in a democracy. I saw, 
for example, the program that we're sponsoring with Voice for 
Humanity, which is using new technology to communicate with 
people in rural areas. I think that's making some progress. We 
need to try new things.
    Senator McConnell. Good.
    Senator Leahy.
    Senator Leahy. Thank you, Mr. Chairman.

                 TRANSFORMATIONAL DIPLOMACY INITIATIVE

    I understand that the Director of Foreign Assistance 
position was created as part of Secretary Rice's 
Transformational Diplomacy Initiative, in an attempt to better 
coordinate foreign policy priorities with foreign aid programs. 
But there's a lot of concern that this may strip USAID of 
decisionmaking authority over what little remains of its 
budget. What is your response to that?
    Ambassador Tobias. That's not the case. In fact, as I have 
said to a number of people at USAID, what now happens is that 
the person who is the Administrator of USAID has a seat at the 
senior-most tables in the decisionmaking processes at the State 
Department that no Administrator has ever had before.
    Senator Leahy. Is that the most transformational part of 
it?
    Ambassador Tobias. No, but it's something that will help in 
the beginnings of bringing USAID's efforts in foreign 
assistance, and the Department of State's efforts in foreign 
assistance into sync so that we're moving forward together in a 
more strategically aligned way. We are beginning to make good 
progress as we put processes in place.
    Senator Leahy. What is the most transformational part of 
this initiative?
    Ambassador Tobias. Well, the first thing that we've done, 
Senator, is to take the USAID people who are engaged in policy 
planning, budgeting, and monitoring and evaluation of programs 
and the people in the State Department who have been engaged in 
those same functions, and put them together into an integrated 
staff. They have all focused on foreign assistance, but they've 
been operating totally separately--they haven't even been on 
the same planning calendars. As we go forward, our intent is 
not to have a USAID budget or a State Department budget, but a 
Foreign Assistance budget that will make all of it more 
coherent in a way that I think all of us can better understand. 
I think you're going to be in a better position to make your 
decisions.
    Senator Leahy. Well, we'll be anxious to see what is done 
with the budget and how it will be structured. I would hope 
that there would be discussion with us as that goes along.

               STRATEGIC FRAMEWORK FOR FOREIGN ASSISTANCE

    In your statement, you speak of your strategic framework 
for foreign assistance. Let me make sure I have this right. You 
have five objectives: achieving and maintaining peace and 
security; helping improve governance and democratic 
participation; contributing to, and promoting, investments in 
people; helping to engender economic growth; responding to 
humanitarian disasters. What is new here? What is USAID doing 
today that does not already fit into one of these five 
objectives?
    Ambassador Tobias. I don't know that there is, but at USAID 
today there are 1,400 strategic objectives. We need to bring 
focus and coherence to the way in which we are doing these 
programs so that we are looking at them on a country-by-country 
basis across all of the programs, so we can get a total picture 
of what are the objectives we're trying to achieve on the 
ground.
    Senator Leahy. But you're not suggesting that one size 
would fit all?
    Ambassador Tobias. No, quite the contrary. To some degree 
there are 154 countries where we're currently doing some type 
of foreign assistance. I think there are buckets or categories 
that certain countries with similar characteristics will fit 
into that will have similar kinds of programs, and that's also 
a part of this framework. But we intend a process here where 
the Secretary is going to be able to provide specific guidance 
to the field, to each country, that will be very country 
specific.
    Senator Leahy. Well, I think you'll probably find a lot of 
those 1,400 objectives will be in many of those countries. I'm 
not suggesting it's not a wise thing to reexamine our strategic 
objectives and determine how to make them more relevant. I 
would not want to change simply for the sake of change. But no 
matter what you do, if you don't have the money, it's not going 
to make much difference. We spend a very small part of our 
budget on foreign aid, especially for a country that's our size 
and much less than a lot of other countries do as a percentage 
of their budgets.

                           FOREIGN AID BUDGET

    As you've talked about refocusing foreign aid, have your 
inter-agency discussions included a discussion of the need to 
significantly increase the budget for anything other than HIV/
AIDS and Millennium Challenge Corporation, or are we going to 
have cuts in next year's budget similar to cuts that we've had 
this year to many key USAID programs?
    Ambassador Tobias. The amount of foreign assistance, from 
the beginning of this administration to the present time, has 
almost tripled. It has been, obviously, the partnership of the 
administration and the Congress that has made that happen.
    Senator Leahy. Well, except that in this year's budget, the 
President cut global health programs by about 15 percent, $136 
million; and yet, one of the places we show the good face and 
generosity of our country has been in these programs. But 
that's been cut.
    Ambassador Tobias. But there's still significant money in 
those programs.
    Senator Leahy. Do you think there's enough?
    Ambassador Tobias. I don't think it's ever enough.
    Senator Leahy. Well, is $136 million less than last year's 
level enough?
    Ambassador Tobias. If there was more I could probably find 
a way to effectively spend it. But my real focus, at the 
moment, is to ensure that we are spending the money that we 
have as efficiently and as effectively as we possibly can. I 
don't believe we're doing that.
    Senator Leahy. Well, we've----
    Ambassador Tobias. I think we can generate some more funds 
by doing it all more efficiently.
    Senator Leahy. We've cut the contribution of the Global 
Fund to Fight AIDS, TB, and Malaria by $250 million. We spent 
almost twice that this week alone in Iraq. Actually it's $350 
million, if you count the additional $100 million taken out of 
the Labor, Health, and Human Services bill. In countries where 
USAID works, there are few doctors, and hospitals are often 
crumbling cement structures built in the 19th century. As 
someone who understands the crisis in public health, why would 
you cut these funds?
    If we are spending roughly a billion dollars or more a week 
in Iraq, and we want to win the hearts and minds of people, I 
might suggest to you that the work we do on Global Fund to 
Fight AIDS and global health is probably winning more hearts 
and minds. These global health programs are the faces of 
America that are most welcome around the world.
    Ambassador Tobias. We shouldn't lose sight of the size of 
the base in these programs. You mentioned HIV/AIDS. We're 
increasing the financial commitment to our very successful 
PEPFAR programs in order to meet the commitment that the 
President made at the beginning of that. That's been a very 
successful use of resources. We do need to support the Global 
Fund, but not at the expense of our bilateral programs.
    Senator Leahy. I understand, but at the same time the 
President's budget would cut family planning and reproductive 
health programs from $425 million to $357 million--an 18 
percent cut. By the President's statement, he said he knows 
that one of the best ways to prevent abortion is by providing 
quality, voluntary family-planning services. Yet, despite the 
administration's strong opposition to abortion, they want to 
cut a program that would primarily reduce unintended 
pregnancies and abortion and reduce child mortality. This 
defies logic.
    My time is up, but you know, I have a great deal of respect 
for your background and what you have done. I have no question 
in my mind of your commitment. I worry, as an American, that we 
have not just financial and security issues, but we have great 
moral issues to care about. Since we have so much more than 
most people, there's a certain moral obligation to give back. I 
look forward to sitting down and chatting about this.
    I appreciate having you here today.
    Ambassador Tobias. I'd be happy to do that, Senator.
    Senator McConnell. Thank you, Senator Leahy.
    Senator Brownback.
    Senator Brownback. Thank you, Mr. Chairman.
    Ambassador, welcome. Good to see you here.
    Ambassador Tobias. Thank you.
    Senator Brownback. Thank you for meeting with me on some of 
these topics previously. I also want to congratulate you on the 
announcement, I guess even just this morning, on inclusion of 
new countries in the President's Malaria Initiative--Malawi, 
Mozambique, Rwanda, and Senegal. I think that's an excellent 
move forward.
    I want to talk with you about a couple of idea areas that 
I'm curious about, and, you know, get your thoughts on them. It 
sounds like we're tracking on the same line on this. The last 
trip I took, with Senator Durbin, to--went to Congo, Rwanda, 
and Kenya--it was very striking to me the breadth of programs. 
It looked like, what you were saying, that we had 1,400 
different strategic initiatives, when you can only probably get 
a couple of these accomplished. In eastern Congo, where people 
are striving to just live, it seems like, to me, you've got a 
hierarchical set of needs, and you need to hit those first, 
that they need food, agriculture, they need water, they need 
healthcare and education, and you've--you get past that, that 
pretty much is going to eat up most of your efforts--and 
should, because that's what, you know, people need to survive, 
to start off with.
    I hope you can get this honed down to a few areas. We're 
working on a bill in my office to take the assistance programs 
to Africa and, in a blunt-instrument approach, just say, ``Half 
of this money has to go in one of these four areas, and it has 
to go for either commodities in these fields or training of 
people on the ground in those countries.'' As we saw in the 
malaria program, when we were studying that, that only 7 
percent of our malaria money--this is 2 years ago--was going 
for actual commodities of bed nets, sprays, or medicine, and 93 
percent was going for conferences and consultants and who knows 
what else. We had a hard time figuring out just what the money 
was going for. But the African leaders we met with said, ``We 
know what to do with malaria, we just don't have the money to 
do it with.'' The same with drilling a water well; you know, 
it's a pretty simple piece of equipment if you're not going too 
deep, not particularly sophisticated to operate, but they've 
got to have it. If they don't have it, there's not clean water 
in your--we may be behind the eight ball in a lot of places. 
So, I applaud that effort, and we're trying to do a similar 
bill to address those areas, in particular.
    I want to applaud your effort on AIDS. The President's 
initiative on HIV/AIDS is saving lives, and lots of them. 
That's one I hope the President and you are very proud of, 
because people are alive today because he went out on a limb to 
do that. I believe we're going to do the same with malaria.
    In suggestion areas, there's an emerging group of new NGOs 
and private groups that want to help out, particularly in the 
continent of Africa. I think there's a real opportunity here 
for you and your office to help point the way. Gates Foundation 
is doing beautiful work in the health field. I met with some 
people associated with another great company the other day that 
want to put significant money into Africa. I've heard of 
another group today. They're--you've got a great opportunity to 
help point people in the right direction and marry them with 
local NGOs. I would urge you to host a private donors summit, 
AID to host it, and to bring in some of these key new players. 
I think everybody knows the people that have been in the field 
for some period of time, and don't ignore 'em, because, you 
know, God bless 'em for the work they've done for years. But 
you've got a number of emerging new players that have 
significant new resources and new energy, and just a hosting, 
really, of a private donors conference, like we do public donor 
conferences for Iraq or Afghanistan, of these groups, and have 
your targets of, you know, ``Okay, one of our key targets is 
water-well drilling or orphans in Africa''--I think people 
would respond to it.
    If you could see fit--and you may not, on this one--but 
there's a burgeoning youth movement. There was 140 places 
across the United States, about a month ago, that walked on a 
night walk for the ``Invisible Children'' of northern Uganda. 
This is a college-student movement that a group of college 
students went over there, did a film, spread it around here, 
and then started chapters around the country. Then, I had a 
young man in my hometown last Sunday night sit down with me, 
saying, ``I want to go to northern Uganda and help these kids I 
just found out about.'' He's never left the United States. He 
may not have been out Kansas previously. But he'd like to help 
these kids in northern Uganda. I'm seeing a lot of that. I 
think there's a moment you can harvest, if you had a targeted 
set of programs of what young activists could be a part of. I 
don't know how you would do that. You've got great minds that 
could help out with that. I think you've got a great moment to 
be able to harvest some of those activities and marry 'em 
together, and you've got a left/right coalition that's coming 
together to sponsor that.
    Hope those are things you're looking at. I don't know if 
you could comment, for a minute or two, about that.
    Ambassador Tobias. Senator, I think those are wonderful 
ideas. As part of the malaria event that we had this morning 
that the First Lady hosted and that you referred to, we had a 
group of people from the private sector and foundation 
representatives who are interested in partnering with each 
other, and with the President's Malaria Initiative, to leverage 
what we're all doing together on the ground. When I was running 
the AIDS initiative, we started a New Partners fund where we 
set aside $200 million that was only available to organizations 
that have done less than $5 million with the Government on HIV/
AIDS work in the last 5 years in order to create an opportunity 
to bring new partners in. Part of that program is to train them 
and give them the skills to work their way through the 
contracting and procurement process with the Government.
    But there are other organizations out there. As you and I 
talked before, large churches, for example, have the resources 
and the wherewithal, but they don't know quite where to go.
    Senator Brownback. Don't know where to go. I----

                        FOREIGN AID COORDINATION

    Ambassador Tobias. I've got people working to create kind 
of a clearinghouse.
    Senator Brownback. If you've got the people on the ground I 
don't mean to butt in, but you've got people on the ground, and 
they've taken me to a number of just phenomenal facilities. You 
know, Dick Durbin----
    Ambassador Tobias. Right.
    Senator Brownback [continuing]. I went to an orphanage in 
Rwanda--600 kids in this orphanage--and they asked Dick and I--
we said--we asked, ``Can we help?'' And they said, ``Yeah, we 
need a cow.'' ``Okay,'' you know, ``we can help with that.'' 
But I was just thinking, your people knew about that, and if 
there was some clearinghouse you had here, and then somebody 
here that contacts a big church in Kentucky or Kansas, saying, 
``We've got this orphanage in eastern Rwanda, and 600 kids, 
and, frankly, they need help. Would you adopt them?''--I think 
these guys would jump all over it. Or a small corporation. Or a 
foundation. But you've got expertise on the ground that none of 
them have. If they could feed it here, and then you network 
with people here, it would be a--it would be a beautiful thing 
and really help people here who want to do that sort of thing. 
But you're probably the only clearinghouse possibility we've 
got, to do that.
    Ambassador Tobias. Frankly, I think part of what happens is 
that our people on the ground who have ideas like that, or 
people outside the Government who want to be involved, sort of 
look at the bureaucratic challenges, and they sort of give up. 
Part of what we have to do--and I think we can--is to get past 
that and make it easy, or make it sufficiently easy, for 
organizations to find the front door, to find the right place 
here, to get the information that we--that we can have, and----
    Senator McConnell. May I----
    Ambassador Tobias [continuing]. Put them in touch.
    Senator McConnell [continuing]. Interject on that point? 
Senator Brownback is right on the mark. I run into that all the 
time----
    Ambassador Tobias. Yeah.
    Senator McConnell [continuing]. Particularly with churches, 
who have both the interest and the wherewithal to help, but 
limited experience with Government bureaucracy. I think Senator 
Brownback is really onto something in suggesting that if you 
could harness those interested groups and people, you could 
magnify your impact exponentially.
    Ambassador Tobias. It also has the impact of building 
greater grassroots support among the American people for----
    Senator Brownback. Right.
    Ambassador Tobias [continuing]. Our whole foreign 
assistance program----
    Senator Brownback. Yeah.
    Ambassador Tobias [continuing]. And understanding why 
America needs to do what we're doing. I do, I think it's a 
wonderful idea, and----
    Senator Brownback. Well, if you could----
    Ambassador Tobias [continuing]. We'll pursue all these 
things.
    Senator Brownback. If there's any way I can help out with 
that, I'd love to do it, because----
    Ambassador Tobias. Thank you.
    Senator Brownback [continuing]. You know, we think we're 
going to have, what, 20 million AIDS orphans in Africa, and 
I've been to some of these places, and it's just enormous. It 
looks like, to me, what you're going to end up with is a lot of 
these children matriculating to towns, and then they're going 
to get trafficked or involved in crime or whatever, because 
their village structure is blown up and it's not just not going 
to happen, and the sooner we can get people to hook into there 
and help--and they would, but they need--they need your door--
--
    Ambassador Tobias. Right.
    Senator Brownback [continuing]. That you could do that.
    Then, finally--I'm past my time, but if you could 
personally host some of these corporate chieftans, and maybe 
just go to meet with them, with the CEO of Pfizer, others, and 
just say, ``Hey, you know, there's a great thing you can do 
here, and I've got a specific project for you.'' It may not be 
something they are interested in, but some of these guys that 
I've met with, they'd really like to help, and--but you've got 
to--I think, frankly, too, you've got to get 'em on the ground 
there to do that.
    Mr. Chairman, thank you very much.
    Senator McConnell. Senator Brownback, I have a meeting I'm 
going to have to make, but would you like to continue--if the 
Ambassador has a little more time--and then wrap the hearing 
up?
    Senator Brownback. Good. If you wouldn't mind, I'd 
appreciate that.
    Senator McConnell. Thank you very much for being here, Mr. 
Ambassador.
    Ambassador Tobias. Thank you, Mr. Chairman.
    Senator McConnell. You're doing a wonderful job, and we're 
proud of you.
    Ambassador Tobias. Thank you very much.
    Senator Brownback [presiding]. Mr. Ambassador--I don't mean 
to drive you overtime, but we've got you here--have you thought 
about that, a meeting with some of these business leaders? 
You've come and been in that environment, and personally taking 
some to some of these places that you would host 'em?
    Ambassador Tobias. Yes. Back in 2003, when I first came 
onboard as the AIDS Coordinator, then-Secretary Thompson of HHS 
had organized a trip to Africa that included a number of 
business leaders that I thought that was very successful. Many 
of them got very motivated. The problem was, at that point in 
time we weren't really in a position to say, ``Okay, now that 
we've got your interest, here's how we can harness that. Here's 
what you can do.'' We do have a program in USAID that is 
specifically focused on trying to find partnerships with the 
private sector. One of the most successful that has come to my 
attention recently is a program where we spent about $10 
million over 5 years in Rwanda helping about 40,000 farmers who 
were engaged in growing coffee, but hadn't really been growing 
it in a commercial way. They were helped to do a better job of 
cultivating and sorting and cooperatives were formed. The 
bottom line is that there are now 4,000 Starbucks stores in the 
United States that are carrying a premium brand of Rwandan 
coffee that came out of that project. USAID is out of the 
picture.
    That's what development is all about. There are skills that 
the private sector, in this case, Starbucks, can bring to bear 
in a whole variety of ways. I agree with you, having been a 
CEO, that there are ways in which we can harness that expertise 
and skill.
    Senator Brownback. Or even contacting 'em, saying, if 
they're interested in going on their own, which I think a lot 
of 'em would want to--say, ``You know, I've got the wherewithal 
myself to go. It'll be a time issue,'' but that if you can make 
it easy for them to see some of these front-line orphanages, 
healthcare clinics, I think----
    Ambassador Tobias. Right.
    Senator Brownback [continuing]. People, once they see it, 
they're just dramatically different. I think that's what 
happened to Bill and Melinda Gates when they went to 
Mozambique.
    Ambassador Tobias. I think it's a very under-utilized 
resource, and we should not only be encouraging the private 
sector on what it can do on its own, but ways in which we can 
partner. I saw a program in Africa a couple of years ago in the 
AIDS prevention area for young people, where Coca-Cola was 
loaning marketing people, the same marketing people who do 
focus groups and test marketing. They were testing prevention 
messages in the same way they would market a new soft drink to 
determine what are young people really going to pay attention 
to, what are they really going to hear? Those are the kinds of 
things that historically have been done mostly by public health 
professionals rather than marketing professionals. I think 
there are a variety of ways in which we can bring those 
resources together, and it is something I intend to pursue.
    Senator Brownback. Good, because I just--there's a real 
interesting moment right now that there's a lot of energy to do 
this, left and right, young and older. I think as we engage 
those in these difficult situations, if we'll engage the poor, 
they'll save our souls in the process, because----
    Ambassador Tobias. Yeah.
    Senator Brownback [continuing]. We get changed in the 
process, because we get changed doing it, and it's a----
    Ambassador Tobias. Right.
    Senator Brownback [continuing]. It's just been beautiful, 
what I've seen, thus far.
    I want to thank you and congratulate you. We will--as I 
say, we're working on a particular bill, and we'll be working 
with your office about that, because sounds as--like, from what 
you've described, that we're on some of the same track.
    I do hope, as a final thought and point, that, on the 
water-well drilling, in particular--I've worked with groups on 
drilling water wells that--they say they're not getting the 
support out of your office that has been funded by the 
Congress. I've sent a letter on this, and I know this is one of 
the strategic initiatives that's needed, because the AIDS 
money, it doesn't go as far if you don't have clean water and 
good food--or it does--isn't as effective if a person's 
drinking bad water. Same with malaria. It just weakens the 
system. There are quite a few groups out there willing to drill 
private water wells, and I think they--we can extend our money 
through them a lot of times, that they'll match it, at least 
one to one, if not higher. I'm hopeful that's something you can 
look at on getting more water wells drilled in some of these 
parts of Africa, in particular.
    Ambassador Tobias. The quest for water is what consumes 
most of the day for people--going someplace to get clean water 
and carrying it long distances. Access to clean water has to be 
a high priority.
    Senator Brownback. Good. Thank you very much. Godspeed.
    Mr. Ambassador, appreciate it. Appreciate the thoughts that 
you've shared here today.
    Ambassador Tobias. Thank you, Senator.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Brownback. 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

                       FOREIGN ASSISTANCE REFORM

    Question. What do you see as Congress's role in foreign assistance 
matters, generally, and with respect to foreign assistance reform, 
specifically?
    Answer. Congress' role is essential to the success of our foreign 
assistance programs and, specifically, foreign assistance reform. I 
support the checks and balances system of our government that allows 
the executive branch to present a budget to Congress and for Congress 
to use its best judgment to direct how that money should be spent. We 
need to do our part to present Congress with a well-justified budget 
that clearly lays out our proposal for the way foreign assistance 
dollars should be spent, and transparently outlines the tradeoffs 
associated with diverging from this proposal. Our former foreign 
assistance budgeting practices did not clearly lay out these tradeoffs, 
leaving Congress with only one option--to use the best information they 
had available to earmark funds.
    The budgeting practices I am establishing with this reform will 
provide Congress with more detailed, timely and accurate information. 
In doing so, Congress will be better positioned to make informed 
decisions about how their budgeting priorities fit into a comprehensive 
picture of U.S. Government foreign assistance. We haven't been able to 
do this before.
    I see the reform as a collaborative effort on the part of the 
executive and legislative branches.
    Question. There have been significant political changes in Central 
and South America over the years--best characterized as a lean to the 
left. For years, Congress has advocated increased assistance to 
countries in those regions, but the administration has not included 
significant increases in its annual budget request.
    In your opinion, what countries in the Western Hemisphere are most 
important to U.S. national security interests, what are those 
interests, and how is U.S. assistance used to further our security 
objectives?
    Please answer the same question with respect to Africa, East Asia, 
the Pacific, the Near East, Europe and Eurasia, and South Asia?
    Answer. U.S national security interests require that we seek to 
expand freedom, prosperity, energy security, peace and stability in the 
Europe and Eurasia region, not just to provide for our own security but 
to improve the security and prosperity of the world as a whole, with 
which our future is linked. To achieve our objectives, we use a range 
of diplomatic and assistance tools in cooperation with our partners and 
other donors, and we also seek to empower and strengthen the 
capabilities of key multilateral institutions like NATO the OSCE, and 
OECD, and to strengthen the U.S.-EU relationship.
    In Southeast Europe, the United States continues to have a 
compelling national interest in helping break the circle of violence 
that plagued the countries of Southeast Europe in the 1990s and support 
their path to Euro-Atlantic integration. Our top priorities for the 
Balkans are to reach a settlement this year on Kosovo's future status 
without isolating Serbia, to help Serbia become stable and democratic, 
and to ensure the success of Bosnia and Herzegovina's efforts to build 
a more integrated modern state that will be able to function without 
strong international supervision. To achieve our objectives, U.S. 
assistance focuses on promoting democratic development and a viable 
market economy that offers opportunities to all, and putting the region 
firmly on the path of integration with Euro-Atlantic institutions.
    Also highly important to maintaining stability and promoting growth 
and democracy in the region is U.S. assistance to Macedonia, Albania, 
and the newly independent Montenegro. U.S. assistance is helping to 
achieve U.S. objectives by increasing local level stability through 
community development activities, supporting tolerance and multi-ethnic 
democratic pluralism, and promoting market-driven economic growth.
    U.S. interests also extend to Bulgaria, Romania, and Croatia. More 
than a decade of U.S. assistance has facilitated progress in the 
economic, democratic and social sectors, although shortcomings remain 
in some areas. Bulgaria and Romania are in the final stages of 
qualification for EU membership, and Croatia is in consultations with 
the EU on its future accession.
    In Eurasia, U.S. interests and assistance focus on supporting the 
sovereignty of post-Soviet states, as well as their democratic 
development, economic growth and energy security. Where possible, such 
as in Ukraine and Georgia, Euro-Atlantic integration is also a 
principal U.S. objective. Armenia and Georgia have achieved enough 
progress in their transition to have concluded compacts for Millennium 
Challenge Corporation assistance, while Ukraine, Moldova, and 
Kyrgyzstan are MCC threshold candidates. In Central Asia, U.S. 
assistance also aims to ease pressures stoking Islamic extremism. In 
the South Caucasus region, U.S. efforts are helping to foster stability 
and democratic practices. Regional conflicts threaten regional security 
and impede the full democratic and economic development of the South 
Caucasus and Black Sea region. The United States is working to promote 
just, lasting, and peaceful resolutions to the separatist conflicts in 
Abkhazia, South Ossetia, Nagorno-Karabakh, and Transnistria. U.S. 
efforts also seek to mitigate ongoing conflict in Chechnya and the 
North Caucasus. Throughout Eurasia we are continuing intensive counter 
narcotics efforts, as well as the fight against the epidemics of HIV/
AIDS and multiple drug resistant tuberculosis. In addition, our 
assistance programs address cross-border threats from terrorism, 
weapons of mass destruction proliferation, trafficking in persons and 
narcotics, and other criminal activity.
    The United States is interested in ensuring that Central Asia does 
not produce another Afghanistan and continues to provide its critical 
support to the Global war on terrorism. Repression, corruption, poverty 
and isolation make the region a breeding ground for terrorism and 
extremist ideologies. Through our assistance, we are working to 
mitigate those conditions by supporting nascent democratic development, 
ensuring successful economic reform, enhancing border security, and 
furthering regional integration in trade and energy.
    In Belarus and Uzbekistan, the United States supports the 
democratic aspirations of the people, with a focus on increasing access 
to information and supporting the growth and capacity of civil society 
groups and independent political parties.
    U.S. relations with Russia, of course, are highly important, with 
elements of cooperation as well as areas of disagreement. We remain 
actively and constructively engaged bilaterally, regionally and 
multilaterally on key issues from counterterrorism to stopping 
trafficking in persons. We work together to cut off terrorist 
financing, share law enforcement information, improve transportation 
security, and prevent proliferation of weapons of mass destruction. We 
are actively assisting with recovery and development in the North 
Caucasus region. As Co-Chairs of the OSCE's Minsk Group, we cooperate 
closely with Russia to promote a peaceful resolution of the Nagorno-
Karabakh conflict. We also urge Russia to cooperate constructively on 
peaceful resolutions of the Abkhazia, South Ossetia, and Transnistria 
conflicts that respect the territorial integrity of Georgia and Moldova 
within their internationally recognized borders. We encourage Russia to 
support reforms in Belarus and Uzbekistan, whose leaders have set these 
countries on courses of repression. The United States works with our 
NATO Allies and the EU to continue to urge Russia to fulfill remaining 
Istanbul commitments relating to withdrawal of its military forces from 
Georgia and Moldova. Fulfillment of the Istanbul commitments is a 
prerequisite for the United States to move forward with ratification of 
the adapted CFE Treaty.
    We are concerned about democratic backsliding in Russia. Russia's 
new NGO law, which went into effect in mid-April, is a particular 
object of our attention. The United States worked closely with our 
European and G-8 allies to communicate our concerns about this 
legislation while it was still under Duma consideration. We believe 
this law will chill and deter independent civil society in Russia. We 
have pledged, together with our European allies, to closely monitor the 
law's impact on civil society. Our assistance programs will continue to 
support NGOs and activists working to promote democracy in Russia.

                AUTHORITY OVER OTHER GOVERNMENT AGENCIES

    Question. As Director of Foreign Assistance, do you have authority 
over foreign assistance activities run by other government agencies--
such as Treasury, CDC, and the MCC?
    Answer. As Director of Foreign Assistance, I maintain authority 
over foreign assistance funds allocated to the State Department and 
USAID, which include approximately 80 percent of the foreign assistance 
dollars appropriated by Congress. I will serve in a coordinating role 
for all foreign assistance, including that delivered through other 
agencies and entities of the U.S. Government.

                     DIRECTOR OF FOREIGN ASSISTANCE

    Question. How has the new position of Director of Foreign 
Assistance been received by the various bureaus at State and USAID--
have you been welcomed, or are you seen as threat?
    Answer. My new position as Director of Foreign Assistance has been 
embraced by various bureaus at State and USAID. As expected with any 
proposed change to status quo, there are those who would prefer the old 
way of doing things. Those bureaus in support of the change recognize 
the need to reform the way we plan, implement and measure the impact of 
our foreign assistance resources to be more coherent and strategic.

                   CONGRESSIONAL BUDGET JUSTIFICATION

    Question. Have you had an opportunity to review the budget 
justification materials that the Committee receives each fiscal year, 
and if so, do you find them adequate? Are you contemplating any changes 
to these materials for the fiscal year 2008 request, or in the account 
structure of the budget request?
    Answer. Our fiscal year 2008 budget justification to Congress will 
differ markedly from previous justification materials. For fiscal year 
2008, USAID and State will present one united budget justification that 
will include all foreign assistance funds and USAID operating expenses. 
In the near future, my staff will be consulting with appropriations 
staff to review our proposal for justification material. At this time 
we are not proposing changes to the account structure for fiscal year 
2008. As the reform process evolves, if we encounter a need to 
recommend changes to account structure, we will work closely with your 
staff to explain the benefit of proposed changes.

                       TRANSFORMATIONAL DIPLOMACY

    Question. What is your definition of ``transformational diplomacy'' 
and how does the fiscal year 2007 budget request support this concept?
    Answer. ``Transformational diplomacy'' is defined by the Secretary 
as, ``To work with our many partners around the world to build and 
sustain democratic, well governed states that will respond to the needs 
of their people and conduct themselves responsibly in the international 
system.'' The fiscal year 2007 budget request aims to provide 
assistance to our partners to continue economic growth, support 
democracy, and expand individual opportunity.

                          REGIONAL PRIORITIES

    Question. There have been significant political changes in Central 
and South America over the years--best characterized as a lean to the 
left. For years, Congress has advocated increased assistance to 
countries in those regions, but the Administration has not included 
significant increases in its annual budget request.
    In your opinion, what countries in the Western Hemisphere are most 
important to U.S. national security interests, what are those 
interests, and how is U.S. assistance used to further our security 
objectives?
    Answer. The Western Hemisphere region as a whole is vital to U.S. 
national security interests. Those interests include U.S. efforts to 
defeat terrorism, to promote freedom, to fight the war on illegal drugs 
and to develop strong trading relationships. Allow me to highlight our 
assistance programs in five key Western Hemisphere nations: Bolivia, 
Colombia, Haiti, Nicaragua and Venezuela.
  --Bolivia.--Evo Morales and his Movement toward Socialism (MAS) party 
        have continued to waver on its commitment to free market 
        economic policy, pluralist democracy, and counternarcotics--key 
        U.S. national security interests. Among other activities, the 
        U.S. Government is focusing assistance to Bolivia on programs 
        that strengthen vibrant and effective democracies, including 
        the support of counterweights to one-party control such as 
        judicial and media independence, a strong civil society, and 
        educated local and state level leaders.
  --Colombia.--The key U.S. national security interest in Colombia is 
        to reduce the production and flow of illicit drugs to the 
        United States. The U.S. Government's alternative development 
        program creates an environment for sustainable and equitable 
        economic growth to create permanent licit alternative income-
        generating opportunities in areas vulnerable to drug production 
        and trafficking. The program stimulates increased private 
        investment and creates the policy and institutional conditions 
        required to sustain and accelerate private investment-based job 
        and income creation. U.S. assistance also encompasses 
        strengthening democratic institutions, expanding access to 
        justice and the rule of law, anti-corruption and the promotion 
        of human rights.
  --Haiti.--The installation of Rene Preval's administration marks the 
        resumption of constitutional governance in Haiti. The U.S. 
        Government is committed to working with the new government of 
        Haiti to help build a stable and well-governed state that is 
        responsive to the needs of its people. Mindful of the need for 
        economic development, the United States is supporting the 
        provision of short-term emergency jobs while helping create the 
        conditions for longer term growth and improved health and 
        education services. We will work with the newly elected Haitian 
        Parliament to strengthen institutional capacity and encourage 
        participatory democracy as a counterbalance to centralized 
        patronage politics. In the critical rule of law sector, our 
        focus will be to reform the justice system and improve access 
        to justice.
  --Nicaragua.--The highest priority in Nicaragua for the United States 
        is ensuring free and fair elections. Elections will be held on 
        November 5, 2006 for president, vice president, members of the 
        National Assembly and delegates to the Central American 
        Parliament. There is a continuing lack of public confidence in 
        the Supreme Electoral Council's handling of the electoral 
        process and in whether or not presidential elections will be 
        handled impartially. In coordination with a variety of 
        international donors and organizations--including the 
        Organization of American States and local nongovernmental 
        organizations--U.S. assistance provides support for voter 
        education activities, updating voter registries, delivering 
        voter identification cards, and domestic and international 
        election observers. U.S. funding is also helping to establish 
        mediation centers nationwide to help alleviate congestion in 
        the court system, improve access to justice, and enhance public 
        confidence in the justice system.
  --Venezuela.--The dismantling of democratic institutions by President 
        Hugo Chavez and increased control by the Venezuelan executive 
        branch over the country's five branches of government threatens 
        the continuation of representative democracy in Venezuela, a 
        key U.S. national security interest. Presidential elections 
        will take place in December 2006, and opposition groups have 
        raised serious concerns over the fairness and transparency of 
        the government-controlled electoral process. The U.S. 
        Government's work in Venezuela is handled through the Office of 
        Transition Initiatives. The objectives are to provide 
        assistance to strengthen and reinvigorate independent 
        democratic voices and reverse democratic backsliding by 
        enhancing civil society dialogue, supporting constitutional 
        processes, and strengthening democratic institutions.

             COUNTRIES MOST IMPORTANT TO THE U.S. IN AFRICA

    Question. In your opinion, what countries in Africa are most 
important to U.S. national security interests, what are those 
interests, and how is U.S. assistance used to further our security 
objectives?
    Answer. The Africa region as a whole is vital to U.S. national 
security interests. Key areas of critical importance throughout the 
continent include counter-terrorism and the implications of extractive 
industries; establishing peace and security; and cross-cutting issues 
of governance, gender, the impact of HIV/AIDS, urbanization and youth. 
Allow me to highlight our assistance programs in Somalia, Ethiopia, 
Eritrea, Sudan, Nigeria, and Liberia.
    The U.S. Government (USG) interests in Sudan are of both a security 
and humanitarian nature. Our goals in Sudan are to successfully 
implement the Comprehensive Peace Agreement, ending the crisis in 
Darfur and integrating all Sudanese regions into the Government of 
National Unity. Our assistance focuses on the displaced populations in 
Darfur, as well as on vulnerable populations in other regions of the 
country. We support resettlement activities for refugees and displaced 
persons and promote activities to protect civilians, especially the 
prevention of violence against women. Looking to the longer term, we 
are also raising local capacity to increase livelihood opportunities 
and strengthen community resilience and local economies.
    Liberia is a cornerstone in our strategy to promote regional 
stability and to inhibit the activities of illegal traffickers and 
terrorists in West Africa. After the signing of the Peace Agreement, 
the USG played a leading role in helping Liberia maintain the peace and 
begin the national reconstruction and rehabilitation process. In 
November 2005, Ellen Johnson Sirleaf was elected as Africa's first 
woman head of state in an election deemed free and fair by the 
international community. Current U.S. assistance is focused on 
solidifying the transition process by enhancing democratic governance, 
supporting agriculture and livelihoods, ensuring stability and security 
by taking the lead in reforming the armed forces and police, 
reintegrating refugees and Internally Displaced Persons, infrastructure 
development, and supporting the provision of essential social services.
    The Horn of Africa, Somalia in particular, is critical to U.S. 
national security interests, given the potential for harboring and 
spreading extremism. U.S. assistance helps reduce poverty and related 
lack of access to social services (education in particular) to help 
lift people out of despair and provide options to extremism. It also 
helps stabilize and strengthen governance institutions that allow for 
peaceful resolution of domestic and regional problems. We are also 
providing food assistance to avert famine and building the region's 
long-term capacity to ensure food security.
    In Nigeria, our interests are to fight corruption, counter 
increasing Islamic radicalization, and ensure stability in the energy 
sector. The USG is working with the Government of Nigeria to strengthen 
its governance institutions and reestablish military-to-military 
relationships. We are building partnerships to counter terrorist 
organizations, implementing recommendations to stabilize the energy 
sector, and working to expand formal financial systems. Our assistance 
is also being used to promote U.S. private sector involvement in the 
key sectors of agriculture and aviation to stimulate economic growth 
and trade.

                              GLOBAL FUND

    Question. If you can put your AIDS Coordinator hat back on for a 
moment, what level of funding is appropriate for the Global Fund in 
fiscal year 2007?
    Answer. The U.S. Government [USG] is by far the largest contributor 
to the fight against global HIV/AIDS. In fiscal year 2004, the USG 
provided approximately one-half of the world's commitment to 
international HIV/AIDS support. The U.S. Government has dramatically 
increased its commitment in fiscal years 2005 and 2006, while the rest 
of the world, so far, has not. With the $4 billion request for fiscal 
year 2007, the disproportion between the U.S. commitment and that of 
the rest of the world will likely continue to grow.
    Each country needs to find the right mix of bilateral and 
multilateral contributions to get the most immediate results from its 
investment. For the USG, the 20-year history of its bilateral programs 
means that these programs can move much faster in the focus countries 
than the Global Fund. Other governments have made similar 
determinations to invest heavily in bilateral efforts rather than 
multilateral options.
    The Global Fund remains an important part of the Emergency Plan 
strategy, and the U.S. Government remains by far its largest single 
contributor of funds. The Emergency Plan originally anticipated 
allocating $1 billion to the Global Fund over five years. However, we 
are now on track to provide over $2 billion to the Fund in just the 
first three years of the Emergency Plan, through fiscal year 2006. The 
President's fiscal year 2007 request for focus country bilateral AIDS 
programs funding--$2.717 billion within Foreign Operations and $2.776 
total--is, in part, an attempt to recover from the effects of the 
redirection of almost $527 million from focus country programs to the 
Global Fund and other components of the Emergency Plan over PEPFAR's 
first three years. If focus country budgets are not fully funded again 
in fiscal year 2007, the capacity needed for a dramatic expansion of 
services in fiscal year 2008 will not be possible--and no increase in 
fiscal year 2008 spending could undo this setback. Without the fiscal 
year 2007 level of funding for the focus countries, it will not be 
possible to meet the 2-7-10 goals of the Emergency Plan--especially the 
goal of supporting treatment for 2 million.
    If the Global Fund maintains its core mission and a model that 
Congress supports, and as the Fund's performance improves in the years 
to come, there will be opportunities to reassess the level of U.S. 
Government funding for it. For fiscal year 2007, however, it is crucial 
that the USG continue to concentrate its resources on focus country 
programs.

                               DEMOCRACY

    Question. What is the total funding level for democracy, governance 
and rule of law programs in the budget request?
    Answer. The USAID request for funding for democracy, governance and 
rule of law programs for fiscal year 2007 is $856,175,000 (including 
DA, ESF, SEED and FSA).

  FISCAL YEAR 2007 PRESIDENT'S BUDGET SUMMARY BY ACCOUNT FOR DEMOCRACY,
                      GOVERNANCE & HUMAN RIGHTS \1\
                        [In millions of dollars]
------------------------------------------------------------------------
                                                       Fiscal year
                                               -------------------------
                    Account                         2006         2007
                                                  estimate     request
------------------------------------------------------------------------
Foreign Operations............................      1,281.1      1,573.4
    Development Assistance....................        190.1        168.6
    Economic Support Fund.....................        655.7        756.3
        USAID-implemented Programs............        422.4        502.4
        State Department/Global Programs......        233.4        253.8
            MEPI..............................         99.0        120.0
            Iraq..............................         55.4         87.3
            South Asia Regional...............          1.0          2.0
            EAP Women's Issues................          1.0          1.0
            Laos..............................  ...........          0.3
            House Democracy Assistance Program          1.0  ...........
            Trafficking in Persons............         11.9          8.5
            UNHCHR Nepal......................          1.5  ...........
            Human Rights & Democracy Fund              62.6         35.0
             Program (DRL) \2\................
    Assistance for E. Europe & Baltics (SEED).        114.5         78.2
        State Department Programs.............         37.2         22.8
        USAID-implemented Programs............         77.3         55.4
    Freedom Support Act.......................        165.4        140.3
        State Department Programs.............         40.9         32.1
        USAID-implemented Programs............        124.5        108.2
    Democracy Fund (excluding UNDEF and HRDF).         23.6  ...........
        National Endowment for Democracy......         15.1  ...........
        Country Programs......................          8.5  ...........
    Inter-American Foundation: Local                    5.2          6.2
     Governance & Democracy...................
    INCLE.....................................         50.4        322.8
        Women's Justice Empowerment Initiative  ...........          9.5
        Trafficking in Persons................          5.0          7.0
        Administration of Justice/Rule of Law/         45.5        306.3
         Anti-corruption......................
    Andean Counterdrug Initiative.............         64.2         62.7
        Administration of Justice/Rule of Law/         29.0         27.9
         Anti-corruption......................
        USAID.................................         35.2         34.8
    IO&P......................................         11.9         38.4
        U.N. Democracy Fund \2\...............          7.9         10.0
        OAS Fund for Strengthening Democracy..          2.5          2.5
        U.N. Voluntary Fund for Technical               1.5          1.5
         Cooperation in the Field of Human
         Rights...............................
        UNDP Democratic Governance Thematic     ...........         24.5
         Trust Fund...........................
State Operations..............................         74.4         77.7
    Related Appropriations....................         74.4         77.7
        The Asia Foundation \3\...............          8.5          6.5
        National Endowment for Democracy \4\..         65.9         71.2
                                               -------------------------
          GRAND TOTAL.........................      1,355.5     1,651.1
------------------------------------------------------------------------
\1\ This table excludes: (1) funding for programs that support victims
  of war and victims of torture that is sometimes categorized as ``human
  rights''; (2) funding categorized as ``conflict management'',
  including all Transition Initiatives (TI) funds, some DA and ESF
  funding, and USG support for the U.S. Institute of Peace; (3) funding
  for educational and cultural exchanges and public diplomacy programs
  funded through State Operations that promote democracy.
\2\ Fiscal year 2006 funds were appropriated in the Democracy Fund.
\3\ Excludes portions of budget that are used for operating expenses and
  non-democracy grant programs.
\4\ Excludes portion of budget that is used for operating expenses.


                                                                             TAB 1.--USAID DEMOCRACY AND GOVERNANCE
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                  Fiscal year
                                                                             -------------------------------------------------------------------------------------------------------------------
                                                                                                    2006 estimate                                          2007 budget request
               Operating unit                     Appropriation  code        -------------------------------------------------------------------------------------------------------------------
                                                                                                                            Democracy                                                 Democracy
                                                                               Rule  of  Political    Civil    Governance      and       Rule  of  Political    Civil    Governance      and
                                                                                 law       process   society                governance     law       process   society                governance
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Africa:
    Africa Regional.........................  DA............................      3,550        288      3,166       6,590       13,594        288      1,368      2,734       5,962       10,352
                                              ESF...........................  .........  .........      4,000       4,613        8,613  .........  .........      9,000       9,250       18,250
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Africa Regional Total.................  ..............................      3,550        288      7,166      11,203       22,207        288      1,368     11,734      15,212       28,602

    Angola..................................  DA............................  .........  .........        550         500        1,050  .........  .........      2,482       1,586        4,068
                                              ESF...........................        250      1,850        270  ..........        2,370        200      1,500        200  ..........        1,900
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Angola Total..........................  ..............................        250      1,850        820         500        3,420        200      1,500      2,682       1,586        5,968

    Benin...................................  DA............................  .........  .........        400  ..........          400  .........  .........        400  ..........          400
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Benin Total...........................  ..............................  .........  .........        400  ..........          400  .........  .........        400  ..........          400

    Burundi.................................  DA............................  .........         99        288         393          780  .........        223        220         350          793
                                              ESF...........................  .........        611      1,200       1,200        3,011  .........        250      1,000         750        2,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Burundi Total.........................  ..............................  .........        710      1,488       1,593        3,791  .........        473      1,220       1,100        2,793

    Democratic Republic of the Congo........  DA............................  .........      1,316      1,000  ..........        2,316      1,000  .........      1,356       1,000        3,356
                                              ESF...........................      1,000  .........      1,950       2,000        4,950      1,000  .........      1,000       3,000        5,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
Democratic Republic of the Congo Total......  ..............................      1,000      1,316      2,950       2,000        7,266      2,000  .........      2,356       4,000        8,356

    Ethiopia................................  DA............................        573  .........  .........       1,000        1,573        600  .........  .........       1,000        1,600
                                              ESF...........................        460  .........      1,000       1,000        2,460        500  .........      1,000       1,000        2,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Ethiopia Total........................  ..............................      1,033  .........      1,000       2,000        4,033      1,100  .........      1,000       2,000        4,100

    Ghana...................................  DA............................  .........  .........        292         200          492  .........  .........        250         250          500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Ghana Total...........................  ..............................  .........  .........        292         200          492  .........  .........        250         250          500

    Guinea..................................  DA............................  .........  .........        569  ..........          569  .........  .........  .........         579          579
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Guinea Total..........................  ..............................  .........  .........        569  ..........          569  .........  .........  .........         579          579

    Kenya...................................  DA............................  .........  .........        400       1,475        1,875  .........  .........        500       1,402        1,902
                                              ESF...........................  .........      1,200      1,520         250        2,970  .........      1,200      1,805         250        3,255
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Kenya Total...........................  ..............................  .........      1,200      1,920       1,725        4,845  .........      1,200      2,305       1,652        5,157

    Liberia.................................  DA............................      1,000  .........  .........       2,684        3,684      1,447  .........      1,300       1,000        3,747
                                              ESF...........................        500  .........      5,000       8,000       13,500      6,000  .........  .........       7,500       13,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Liberia Total.........................  ..............................      1,500  .........      5,000      10,684       17,184      7,447  .........      1,300       8,500       17,247

    Madagascar..............................  DA............................  .........  .........        492         400          892  .........  .........  .........         400          400
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Madagascar Total......................  ..............................  .........  .........        492         400          892  .........  .........  .........         400          400

    Mali....................................  DA............................  .........        100        429         600        1,129  .........        100        448         600        1,148
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Mali Total............................  ..............................  .........        100        429         600        1,129  .........        100        448         600        1,148

    Mozambique..............................  DA............................  .........  .........  .........         992          992  .........  .........  .........       1,000        1,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Mozambique Total......................  ..............................  .........  .........  .........         992          992  .........  .........  .........       1,000        1,000

    Namibia.................................  DA............................  .........  .........        490         272          762  .........  .........        465         310          775
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Namibia Total.........................  ..............................  .........  .........        490         272          762  .........  .........        465         310          775

    Nigeria.................................  DA............................  .........        132      1,318       1,846        3,296     10,352  .........  .........  ..........       10,352
                                              ESF...........................  .........      4,950  .........  ..........        4,950  .........      5,000  .........  ..........        5,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Nigeria Total.........................  ..............................  .........      5,082      1,318       1,846        8,246     10,352      5,000  .........  ..........       15,352

    REDSO-ESA...............................  DA............................  .........  .........        836       1,000        1,836  .........  .........        867       1,000        1,867
                                              ESF...........................  .........        300        500  ..........          800  .........        200        800  ..........        1,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      REDSO-ESA Total.......................  ..............................  .........        300      1,336       1,000        2,636  .........        200      1,667       1,000        2,867

    Regional Center for Southern Africa.....  DA............................  .........        500        483  ..........          983  .........      1,000        850  ..........        1,850
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Regional Center for Southern Africa     ..............................  .........        500        483  ..........          983  .........      1,000        850  ..........        1,850
       Total.

    Rwanda..................................  DA............................  .........  .........      1,000         629        1,629  .........  .........      1,000         648        1,648
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Rwanda Total..........................  ..............................  .........  .........      1,000         629        1,629  .........  .........      1,000         648        1,648

    Senegal.................................  DA............................  .........  .........        263         720          983  .........  .........  .........       1,000        1,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Senegal Total.........................  ..............................  .........  .........        263         720          983  .........  .........  .........       1,000        1,000

    Sierra Leone............................  DA............................  .........  .........  .........       2,041        2,041  .........  .........  .........       2,076        2,076
                                              ESF...........................  .........  .........  .........       5,940        5,940  .........        500        500       1,500        2,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Sierra Leone Total....................  ..............................  .........  .........  .........       7,981        7,981  .........        500        500       3,576        4,576

    Somalia.................................  DA............................  .........  .........      1,545  ..........        1,545  .........  .........      1,571  ..........        1,571
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Somalia Total.........................  ..............................  .........  .........      1,545  ..........        1,545  .........  .........      1,571  ..........        1,571

    South Africa............................  DA............................      2,178  .........      1,565       1,430        5,173  .........  .........      1,752       3,504        5,256
                                              ESF...........................      1,000  .........        287  ..........        1,287      1,300  .........  .........  ..........        1,300
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      South Africa Total....................  ..............................      3,178  .........      1,852       1,430        6,460      1,300  .........      1,752       3,504        6,556

    Sudan...................................  DA............................  .........      2,100      1,749         300        4,149  .........      2,100      1,749         300        4,149
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Sudan Total...........................  ..............................  .........      2,100      1,749         300        4,149  .........      2,100      1,749         300        4,149

    Tanzania................................  DA............................  .........  .........        264         800        1,064  .........  .........        310         764        1,074
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Tanzania Total........................  ..............................  .........  .........        264         800        1,064  .........  .........        310         764        1,074

    Uganda..................................  DA............................  .........      1,218        500         660        2,378  .........      1,000      1,419  ..........        2,419
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Uganda Total..........................  ..............................  .........      1,218        500         660        2,378  .........      1,000      1,419  ..........        2,419

    West African Regional Program (WARP)....  DA............................  .........  .........      4,280         600        4,880  .........  .........      6,354         600        6,954
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      West African Regional Program (WARP)    ..............................  .........  .........      4,280         600        4,880  .........  .........      6,354         600        6,954
       Total.

    Zambia..................................  DA............................  .........  .........        300         450          750  .........  .........        300         450          750
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Zambia Total..........................  ..............................  .........  .........        300         450          750  .........  .........        300         450          750

    Zimbabwe................................  DA............................  .........        376        500         500        1,376  .........  .........        700         700        1,400
                                              ESF...........................  .........        900        570       1,500        2,970  .........  .........      1,000       2,000        3,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Zimbabwe Total........................  ..............................  .........      1,276      1,070       2,000        4,346  .........  .........      1,700       2,700        4,400
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Africa Total..........................  ..............................     10,511     15,940     38,976      50,585      116,012     22,687     14,441     43,332      51,731      132,191
                                             ===================================================================================================================================================
Asia and Near East:
    Afghanistan.............................  DA............................      7,500  .........  .........      22,500       30,000     12,000      7,000  .........       6,000       25,000
                                              ESF...........................  .........      3,000      8,000      47,000       58,000  .........      3,000      9,000     124,000      136,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Afghanistan Total.....................  ..............................      7,500      3,000      8,000      69,500       88,000     12,000     10,000      9,000     130,000      161,000

    ANE Regional............................  DA............................  .........  .........  .........       2,028        2,028  .........  .........  .........       3,225        3,225
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      ANE Regional Total....................  ..............................  .........  .........  .........       2,028        2,028  .........  .........  .........       3,225        3,225

    Bangladesh..............................  DA............................      1,238  .........  .........       1,336        2,574  .........  .........  .........       1,550        1,550
                                              ESF...........................      1,000      2,000  .........       1,752        4,752      1,000      2,000  .........       2,000        5,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Bangladesh Total......................  ..............................      2,238      2,000  .........       3,088        7,326      1,000      2,000  .........       3,550        6,550

    Cambodia................................  DA............................  .........  .........  .........  ..........  ...........        237  .........  .........         673          910
                                              ESF...........................      6,113      3,485        817         960       11,375      4,595      4,160        975       2,770       12,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Cambodia Total........................  ..............................      6,113      3,485        817         960       11,375      4,832      4,160        975       3,443       13,410

    China...................................  DA............................      2,475  .........  .........  ..........        2,475  .........  .........  .........         733          733
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      China Total...........................  ..............................      2,475  .........  .........  ..........        2,475  .........  .........  .........         733          733

    East Timor..............................  ESF...........................      3,000  .........  .........       3,000        6,000      1,500      1,400  .........       1,100        4,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      East Timor Total......................  ..............................      3,000  .........  .........       3,000        6,000      1,500      1,400  .........       1,100        4,000

    Egypt...................................  ESF...........................     17,060      6,020     14,850      47,575       85,505     17,605      6,310     12,415      50,125       86,455
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Egypt Total...........................  ..............................     17,060      6,020     14,850      47,575       85,505     17,605      6,310     12,415      50,125       86,455

    India...................................  DA............................        326  .........  .........  ..........          326  .........  .........  .........  ..........  ...........
                                              ESF...........................        200  .........  .........  ..........          200  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      India Total...........................  ..............................        526  .........  .........  ..........          526  .........  .........  .........  ..........  ...........

    Indonesia...............................  ESF...........................      5,200      7,000      3,400      14,850       30,450      1,975      3,464  .........      14,175       19,614
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Indonesia Total.......................  ..............................      5,200      7,000      3,400      14,850       30,450      1,975      3,464  .........      14,175       19,614

    Iraq....................................  ESF...........................  .........  .........  .........  ..........  ...........  .........  .........  .........      25,000       25,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Iraq Total............................  ..............................  .........  .........  .........  ..........  ...........  .........  .........  .........      25,000       25,000

    Jordan..................................  ESF...........................      3,000      3,000      5,000       3,000       14,000      3,000      2,000      4,000       3,000       12,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Jordan Total..........................  ..............................      3,000      3,000      5,000       3,000       14,000      3,000      2,000      4,000       3,000       12,000

    Lebanon.................................  ESF...........................  .........  .........      2,000       5,000        7,000      8,000  .........      1,000       1,000       10,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Lebanon Total.........................  ..............................  .........  .........      2,000       5,000        7,000      8,000  .........      1,000       1,000       10,000

    Mongolia................................  ESF...........................      2,000        100  .........         300        2,400      1,500  .........  .........         400        1,900
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Mongolia Total........................  ..............................      2,000        100  .........         300        2,400      1,500  .........  .........         400        1,900

    Morocco.................................  ESF...........................  .........      2,900        600       2,940        6,440  .........  .........      1,000       7,000        8,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Morocco Total.........................  ..............................  .........      2,900        600       2,940        6,440  .........  .........      1,000       7,000        8,000

    Nepal...................................  DA............................      1,485  .........  .........  ..........        1,485      1,500  .........  .........  ..........        1,500
                                              ESF...........................  .........        990  .........  ..........          990  .........      1,000  .........  ..........        1,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Nepal Total...........................  ..............................      1,485        990  .........  ..........        2,475      1,500      1,000  .........  ..........        2,500

    Pakistan................................  DA............................  .........  .........  .........       3,597        3,597  .........  .........  .........       3,000        3,000
                                              ESF...........................  .........     12,600  .........       7,400       20,000  .........      8,000  .........      19,000       27,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Pakistan Total........................  ..............................  .........     12,600  .........      10,997       23,597  .........      8,000  .........      22,000       30,000

    Philippines.............................  DA............................      1,000  .........  .........       1,000        2,000  .........        651  .........         250          901
                                              ESF...........................      3,000  .........      2,500       1,000        6,500      1,000        249  .........       6,500        7,749
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Philippines Total.....................  ..............................      4,000  .........      2,500       2,000        8,500      1,000        900  .........       6,750        8,650

    Regional Development Mission Asia (RDM-   DA............................  .........  .........        491  ..........          491  .........  .........        640  ..........          640
     Asia).
                                              ESF...........................  .........  .........      3,564  ..........        3,564  .........  .........      3,500  ..........        3,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Regional Development Mission Asia (RDM- ..............................  .........  .........      4,055  ..........        4,055  .........  .........      4,140  ..........        4,140
       Asia) Total.

    Sri Lanka...............................  DA............................  .........  .........      1,233  ..........        1,233  .........  .........  .........         750          750
                                              ESF...........................  .........  .........  .........       2,000        2,000  .........        250        250         800        1,300
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Sri Lanka Total.......................  ..............................  .........  .........      1,233       2,000        3,233  .........        250        250       1,550        2,050

    West Bank and Gaza \1\..................  ESF...........................     19,922      3,000      8,300       5,628       36,850      4,000  .........      6,000      15,500       25,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      West Bank and Gaza Total..............  ..............................     19,922      3,000      8,300       5,628       36,850      4,000  .........      6,000      15,500       25,500

    Yemen...................................  ESF...........................        644  .........        465  ..........        1,109        263  .........         50       1,685        1,998
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Yemen Total...........................  ..............................        644  .........        465  ..........        1,109        263  .........         50       1,685        1,998
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Asia and Near East Total..............  ..............................     75,163     44,095     51,220     172,866      343,344     58,175     39,484     38,830     290,236      426,725
                                             ===================================================================================================================================================
Europe and Eurasia:
    Albania.................................  AEEB..........................      1,200        500      2,127       2,100        5,927      1,000        300      1,554       1,935        4,789
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Albania Total.........................  ..............................      1,200        500      2,127       2,100        5,927      1,000        300      1,554       1,935        4,789

    Armenia.................................  FSA...........................        431      2,292      4,156       6,721       13,600        389        387      4,021       5,163        9,960
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Armenia Total.........................  ..............................        431      2,292      4,156       6,721       13,600        389        387      4,021       5,163        9,960

    Azerbaijan..............................  FSA...........................      1,143      1,885      4,335       1,486        8,849        672      1,422      4,040       1,000        7,134
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Azerbaijan Total......................  ..............................      1,143      1,885      4,335       1,486        8,849        672      1,422      4,040       1,000        7,134

    Belarus.................................  FSA...........................        414        970      3,732  ..........        5,116        390        906      4,641  ..........        5,937
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Belarus Total.........................  ..............................        414        970      3,732  ..........        5,116        390        906      4,641  ..........        5,937

    Bosnia and Herzegovina..................  AEEB..........................      3,500      1,700      3,230       4,206       12,636      2,450      1,600      2,300       3,002        9,352
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Bosnia and Herzegovina Total..........  ..............................      3,500      1,700      3,230       4,206       12,636      2,450      1,600      2,300       3,002        9,352

    Bulgaria................................  AEEB..........................      4,315  .........      1,104       3,446        8,865  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Bulgaria Total........................  4,315.........................      1,104      3,446      8,865  ..........  ...........  .........  .........  .........

    Croatia.................................  AEEB..........................  .........  .........      2,125       3,711        5,836  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Croatia Total.........................  ..............................  .........  .........      2,125       3,711        5,836  .........  .........  .........  ..........  ...........

    Eurasia Regional........................  FSA...........................        130         65        330          65          590        140         65        490          65          760
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Eurasia Regional Total................  ..............................        130         65        330          65          590        140         65        490          65          760

    Europe Regional.........................  AEEB..........................        265        108        704         118        1,195        216         95      1,104         103        1,518
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Europe Regional Total.................  ..............................        265        108        704         118        1,195        216         95      1,104         103        1,518

    Georgia.................................  FSA...........................      2,055        722        809       6,007        9,593      1,537        659        706       5,993        8,895
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Georgia Total.........................  ..............................      2,055        722        809       6,007        9,593      1,537        659        706       5,993        8,895

    Kazakhstan..............................  FSA...........................        856        397      3,864  ..........        5,117  .........  .........      4,238  ..........        4,238
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Kazakhstan Total......................  ..............................        856        397      3,864  ..........        5,117  .........  .........      4,238  ..........        4,238

    Kosovo..................................  AEEB..........................      5,575      2,175      3,575       2,730       14,055      6,297      1,925      2,646       5,150       16,018
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Kosovo Total..........................  ..............................      5,575      2,175      3,575       2,730       14,055      6,297      1,925      2,646       5,150       16,018

    Kyrgyzstan..............................  FSA...........................  .........  .........      2,644       1,800        4,444      1,000        200      3,180       1,676        6,056
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Kyrgyzstan Total......................  ..............................  .........  .........      2,644       1,800        4,444      1,000        200      3,180       1,676        6,056

    Macedonia...............................  AEEB..........................      2,687      1,612      1,931       3,996       10,226      2,615      1,000      1,807       2,546        7,968
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Macedonia Total.......................  ..............................      2,687      1,612      1,931       3,996       10,226      2,615      1,000      1,807       2,546        7,968

    Moldova.................................  FSA...........................      1,645      1,138      1,644       2,599        7,026      1,696      1,825      2,384         173        6,078
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Moldova Total.........................  ..............................      1,645      1,138      1,644       2,599        7,026      1,696      1,825      2,384         173        6,078

    Montenegro..............................  AEEB..........................      1,200        560      1,028  ..........        2,788        300  .........        600       1,250        2,150
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Montenegro Total......................  ..............................      1,200        560      1,028  ..........        2,788        300  .........        600       1,250        2,150

    Romania.................................  AEEB..........................        450      1,400      2,700         950        5,500  .........  .........  .........  ..........  ...........
      Romania Total.........................  ..............................        450      1,400      2,700         950        5,500  .........  .........  .........  ..........  ...........

    Russia..................................  FSA...........................      4,162      5,565     25,418       3,105       38,250      3,155      3,615     18,299       3,815       28,884
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Russia Total..........................  ..............................      4,162      5,565     25,418       3,105       38,250      3,155      3,615     18,299       3,815       28,884

    Serbia..................................  AEEB..........................      1,805      1,400      3,000       1,000        7,205      4,027      1,400      3,500       1,000        9,927
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Serbia Total..........................  ..............................      1,805      1,400      3,000       1,000        7,205      4,027      1,400      3,500       1,000        9,927

    Tajikistan..............................  FSA...........................  .........        350      2,100       1,636        4,086  .........  .........      2,554       1,692        4,246
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Tajikistan Total......................  ..............................  .........        350      2,100       1,636        4,086  .........  .........      2,554       1,692        4,246

    Turkmenistan............................  FSA...........................  .........  .........      1,090  ..........        1,090  .........  .........      1,100  ..........        1,100
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Turkmenistan Total....................  ..............................  .........  .........      1,090  ..........        1,090  .........  .........      1,100  ..........        1,100

    Ukraine.................................  FSA...........................      1,041      3,746      7,088       6,360       18,235      3,207      1,446      4,593       9,391       18,637
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Ukraine Total.........................  ..............................      1,041      3,746      7,088       6,360       18,235      3,207      1,446      4,593       9,391       18,637

    Uzbekistan..............................  FSA...........................        500  .........      2,710  ..........        3,210      1,002  .........      2,580  ..........        3,582
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Uzbekistan Total......................  ..............................        500  .........      2,710  ..........        3,210      1,002  .........      2,580  ..........        3,582
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Europe and Eurasia Total..............  ..............................     33,374     26,585     81,444      52,036      193,439     30,093     16,845     66,337      43,954      157,229
                                             ===================================================================================================================================================
Latin America and Caribbean:
    Bolivia.................................  ACI...........................      2,970  .........  .........         400        3,370      2,000  .........  .........  ..........        2,000
                                              DA............................  .........  .........  .........       2,574        2,574  .........  .........  .........       2,466        2,466
                                              ESF...........................  .........      1,000      1,356       1,109        3,465  .........      1,000      1,000       1,100        3,100
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Bolivia Total.........................  ..............................      2,970      1,000      1,356       4,083        9,409      2,000      1,000      1,000       3,566        7,566

    Caribbean Regional Program..............  ESF...........................  .........  .........  .........  ..........  ...........      1,000  .........  .........  ..........        1,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Caribbean Regional Program Total......  ..............................  .........  .........  .........  ..........  ...........      1,000  .........  .........  ..........        1,000

    Colombia................................  ACI...........................     13,750  .........      2,621       9,198       25,569     13,806  .........      2,694       8,522       25,022
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Colombia Total........................  ..............................     13,750  .........      2,621       9,198       25,569     13,806  .........      2,694       8,522       25,022

    Cuba....................................  ESF...........................  .........  .........      7,650  ..........        7,650  .........  .........      6,500  ..........        6,500
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Cuba Total............................  ..............................  .........  .........      7,650  ..........        7,650  .........  .........      6,500  ..........        6,500

    Dominican Republic......................  DA............................        280      1,350  .........         350        1,980        900        950  .........         150        2,000
                                              ESF...........................      1,000  .........  .........         980        1,980      2,000  .........  .........  ..........        2,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Dominican Republic Total..............  ..............................      1,280      1,350  .........       1,330        3,960      2,900        950  .........         150        4,000

    Ecuador.................................  ACI...........................  .........  .........  .........       2,000        2,000  .........  .........  .........       3,400        3,400
                                              DA............................        690  .........        300  ..........          990  .........  .........  .........       1,000        1,000
                                              ESF...........................        600        400        780         200        1,980        150        550        400       1,078        2,178
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Ecuador Total.........................  ..............................      1,290        400      1,080       2,200        4,970        150        550        400       5,478        6,578

    El Salvador.............................  DA............................      1,387  .........        500       1,840        3,727  .........  .........  .........         250          250
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      El Salvador Total.....................  ..............................      1,387  .........        500       1,840        3,727  .........  .........  .........         250          250

    Guatemala...............................  DA............................  .........  .........  .........       1,485        1,485  .........        100  .........       2,991        3,091
                                              ESF...........................      1,891        396  .........       2,168        4,455      1,850  .........  .........       1,150        3,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Guatemala Total.......................  ..............................      1,891        396  .........       3,653        5,940      1,850        100  .........       4,141        6,091

    Guyana..................................  DA............................        310        780        440         450        1,980      1,000  .........      1,000  ..........        2,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Guyana Total..........................  ..............................        310        780        440         450        1,980      1,000  .........      1,000  ..........        2,000

    Haiti...................................  DA............................  .........        795        791       2,350        3,936  .........      2,850      4,150       2,000        9,000
                                              ESF...........................      5,650      5,250      1,309      16,591       28,800  .........  .........      5,700      10,000       15,700
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Haiti Total...........................  ..............................      5,650      6,045      2,100      18,941       32,736  .........      2,850      9,850      12,000       24,700

    Honduras................................  DA............................        600  .........  .........       1,380        1,980        600  .........  .........       1,848        2,448
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Honduras Total........................  ..............................        600  .........  .........       1,380        1,980        600  .........  .........       1,848        2,448

    Jamaica.................................  DA............................      1,014  .........      1,261         200        2,475      1,687  .........        150  ..........        1,837
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Jamaica Total.........................  ..............................      1,014  .........      1,261         200        2,475      1,687  .........        150  ..........        1,837

    LAC Regional............................  DA............................        506        500         90       8,299        9,395  .........  .........      2,326       1,000        3,326
                                              ESF...........................      3,000  .........      2,960       1,000        6,960  .........      1,500      1,995       1,600        5,095
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      LAC Regional Total....................  ..............................      3,506        500      3,050       9,299       16,355  .........      1,500      4,321       2,600        8,421

    Mexico..................................  DA............................      2,610  .........  .........         790        3,400      1,700  .........  .........         300        2,000
                                              ESF...........................      2,083        400      2,100       1,533        6,116      3,000  .........      2,000       1,200        6,200
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Mexico Total..........................  ..............................      4,693        400      2,100       2,323        9,516      4,700  .........      2,000       1,500        8,200

    Nicaragua...............................  DA............................      2,750      2,000  .........       2,398        7,148      2,116  .........  .........       2,116        4,232
                                              ESF...........................  .........      3,366  .........  ..........        3,366  .........      1,500      1,500  ..........        3,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Nicaragua Total.......................  ..............................      2,750      5,366  .........       2,398       10,514      2,116      1,500      1,500       2,116        7,232

    Panama..................................  ESF...........................  .........  .........  .........         990          990  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Panama Total..........................  ..............................  .........  .........  .........         990          990  .........  .........  .........  ..........  ...........

    Paraguay................................  DA............................        980  .........  .........       1,000        1,980        250  .........        250       1,330        1,830
                                              ESF...........................  .........        980      1,000  ..........        1,980        250        250        250       1,250        2,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Paraguay Total........................  ..............................        980        980      1,000       1,000        3,960        500        250        500       2,580        3,830

    Peru....................................  ACI...........................  .........  .........      1,200       2,960        4,160  .........  .........      1,000       3,400        4,400
                                              DA............................  .........  .........  .........       1,287        1,287  .........  .........  .........       1,740        1,740
                                              ESF...........................  .........      1,090  .........         890        1,980  .........      1,000  .........       1,000        2,000
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Peru Total............................  ..............................  .........      1,090      1,200       5,137        7,427  .........      1,000      1,000       6,140        8,140
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Latin America and Caribbean Total.....  ..............................     42,071     18,307     24,358      64,422      149,158     32,309      9,700     30,915      50,891      123,815
                                             ===================================================================================================================================================
Democracy, Conflict and Humanitarian
 Assistance:
    Office of Democracy and Governance......  DA............................      2,227     19,800      3,366       2,723       28,116      2,500      7,150      3,500       2,750       15,900
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Office of Democracy and Governance      ..............................      2,227     19,800      3,366       2,723       28,116      2,500      7,150      3,500       2,750       15,900
       Total.

    Office of Private and Voluntary           DA............................  .........  .........        891  ..........          891  .........  .........  .........  ..........  ...........
     Cooperation.
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Office of Private and Voluntary         ..............................  .........  .........        891  ..........          891  .........  .........  .........  ..........  ...........
       Cooperation Total.
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Democracy, Conflict and Humanitarian    ..............................      2,227     19,800      4,257       2,723       29,007      2,500      7,150      3,500       2,750       15,900
       Assistance  Total.
                                             ===================================================================================================================================================
Office of Global Development Alliances:
    Office of Global Development Alliances..  DA............................  .........  .........  .........       1,880        1,880  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Office of Global Development Alliances  ..............................  .........  .........  .........       1,880        1,880  .........  .........  .........  ..........  ...........
       Total.
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Office of Global Development Alliances  ..............................  .........  .........  .........       1,880        1,880  .........  .........  .........  ..........  ...........
       Total.
                                             ===================================================================================================================================================
Program and Policy Coordination:
    Bureau for Policy and Program             DA............................         80         80         80          80          320         78         79         79          79          315
     Coordination.
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Bureau for Policy and Program           ..............................         80         80         80          80          320         78         79         79          79          315
       Coordination Total.
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Program and Policy Coordination Total.  ..............................         80         80         80          80          320         78         79         79          79          315
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
                                              ACI Sum.......................     16,720  .........      3,821      14,558       35,099     15,806  .........      3,694      15,322       34,822
                                              AEEB  Sum.....................     20,997      9,455     21,524      22,257       74,233     16,905      6,320     13,511      14,986       51,722
                                              DA Sum........................     34,759     31,434     32,122      85,629      183,944     38,255     24,571     39,122      62,682      164,630
                                              ESF Sum.......................     78,573     66,788     82,948     192,369      420,678     61,688     46,283     73,840     317,683      499,494
                                              FSA Sum.......................     12,377     17,130     59,920      29,779      119,206     13,188     10,525     52,826      28,968      105,507
                                              IDA Sum.......................  .........  .........  .........  ..........  ...........  .........  .........  .........  ..........  ...........
                                             ---------------------------------------------------------------------------------------------------------------------------------------------------
      Grand Total--USAID Democracy &          ..............................    163,426    124,807    200,335     344,592      833,160    145,842     87,699    182,993     439,641     856,175
       Governance.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Notional--program under review.


                                                               TAB 2.--USAID HUMAN RIGHTS
                                                                [In thousands of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                      Fiscal year
                                                             -------------------------------------------------------------------------------------------
                                                                              2006 estimate                              2007 budget request
           Operating unit             Appropriation  code    -------------------------------------------------------------------------------------------
                                                                          Victims   Trafficking    Total                Victims   Trafficking    Total
                                                               Victims       of          in        human     Victims       of          in        human
                                                               of  war    torture     persons      rights    of  war    torture     persons      rights
--------------------------------------------------------------------------------------------------------------------------------------------------------
Africa:
    Africa Regional.................  DA....................      2,950      2,778       1,966       7,694      3,000      2,825       2,000       7,825
                                     -------------------------------------------------------------------------------------------------------------------
      Africa Regional Total.........  ......................      2,950      2,778       1,966       7,694      3,000      2,825       2,000       7,825

    Ethiopia........................  ESF...................  .........  .........         300         300  .........  .........         300         300
                                     -------------------------------------------------------------------------------------------------------------------
      Ethiopia Total................  ......................  .........  .........         300         300  .........  .........         300         300
                                     -------------------------------------------------------------------------------------------------------------------
      Africa Total..................  ......................      2,950      2,778       2,266       7,994      3,000      2,825       2,300       8,125
                                     ===================================================================================================================
Asia and Near East:
    Bangladesh......................  DA....................  .........  .........         891         891  .........  .........       1,000       1,000
                                     -------------------------------------------------------------------------------------------------------------------
      Bangladesh Total..............  ......................  .........  .........         891         891  .........  .........       1,000       1,000

    Cambodia........................  DA....................  .........  .........       2,331       2,331  .........  .........  ...........  .........
                                      ESF...................  .........  .........  ...........  .........  .........  .........       1,000       1,000
                                     -------------------------------------------------------------------------------------------------------------------
      Cambodia Total................  ......................  .........  .........       2,331       2,331  .........  .........       1,000       1,000

    India...........................  DA....................  .........  .........  ...........  .........  .........        374  ...........        374
                                      ESF...................  .........  .........  ...........  .........  .........        270  ...........        270

      India Total...................  ......................  .........  .........  ...........  .........  .........        644  ...........        644

    Indonesia.......................  ESF...................  .........  .........       1,400       1,400  .........  .........         386         386
                                     -------------------------------------------------------------------------------------------------------------------
      Indonesia Total...............  ......................  .........  .........       1,400       1,400  .........  .........         386         386

    Iraq............................  ESF...................      5,000  .........  ...........      5,000  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Iraq Total....................  5,000.................  .........  .........       5,000   .........  .........  .........  ...........

    Nepal...........................  ESF...................        301  .........  ...........        301  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Nepal Total...................  ......................        301  .........  ...........        301  .........  .........  ...........  .........

    Pakistan........................  DA....................  .........  .........  ...........  .........  .........  .........       1,000       1,000
                                     -------------------------------------------------------------------------------------------------------------------
      Pakistan Total................  ......................  .........  .........  ...........  .........  .........  .........       1,000       1,000

    Philippines.....................  ESF...................  .........  .........  ...........  .........  .........  .........         250         250
                                     -------------------------------------------------------------------------------------------------------------------
      Philippines Total.............  ......................  .........  .........  ...........  .........  .........  .........         250         250

    Regional Development Mission--    DA....................        743  .........  ...........        743  .........  .........  ...........  .........
     Asia (RDM-Asia).
                                     -------------------------------------------------------------------------------------------------------------------
      Regional Development Mission--  ......................        743  .........  ...........        743  .........  .........  ...........  .........
       Asia (RDM-Asia) Total.

    Sri Lanka.......................  DA....................      1,000  .........  ...........      1,000      1,000  .........  ...........      1,000
                                     -------------------------------------------------------------------------------------------------------------------
      Sri Lanka Total...............  ......................      1,000  .........  ...........      1,000      1,000  .........  ...........      1,000
                                     -------------------------------------------------------------------------------------------------------------------
      Asia and Near East Total......  ......................      7,044  .........       4,622      11,666      1,000        644       3,636       5,280
                                     ===================================================================================================================
Europe and Eurasia:
    Albania.........................  AEEB..................  .........  .........       1,530       1,530  .........  .........       1,343       1,343
                                     -------------------------------------------------------------------------------------------------------------------
      Albania Total.................  ......................  .........  .........       1,530       1,530  .........  .........       1,343       1,343

    Bosnia and Herzegovina..........  AEEB..................  .........  .........         800         800  .........  .........       1,905       1,905
                                     -------------------------------------------------------------------------------------------------------------------
      Bosnia and Herzegovina Total..  ......................  .........  .........         800         800  .........  .........       1,905       1,905

    Bulgaria........................  AEEB..................  .........  .........         145         145  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Bulgaria Total................  ......................  .........  .........         145         145  .........  .........  ...........  .........

    Eurasia Regional................  FSA...................  .........  .........  ...........  .........  .........  .........          80          80
                                     -------------------------------------------------------------------------------------------------------------------
      Eurasia Regional Total........  ......................  .........  .........  ...........  .........  .........  .........          80          80

    Europe Regional.................  AEEB..................  .........  .........         673         673  .........  .........         275         275
                                     -------------------------------------------------------------------------------------------------------------------
      Europe Regional Total.........  ......................  .........  .........         673         673  .........  .........         275         275

    Georgia.........................  FSA...................  .........  .........         222         222  .........  .........         220         220
                                     -------------------------------------------------------------------------------------------------------------------
      Georgia Total.................  ......................  .........  .........         222         222  .........  .........         220         220

    Kazakhstan......................  FSA...................  .........  .........         680         680  .........  .........         242         242
                                     -------------------------------------------------------------------------------------------------------------------
      Kazakhstan Total..............  ......................  .........  .........         680         680  .........  .........         242         242

    Kosovo..........................  AEEB..................  .........  .........  ...........  .........  .........  .........         200         200
                                     -------------------------------------------------------------------------------------------------------------------
      Kosovo Total..................  ......................  .........  .........  ...........  .........  .........  .........         200         200

    Kyrgyzstan......................  FSA...................  .........  .........         350         350  .........  .........         170         170
                                     -------------------------------------------------------------------------------------------------------------------
      Kyrgyzstan Total..............  ......................  .........  .........         350         350  .........  .........         170         170

    Moldova.........................  FSA...................  .........  .........         972         972  .........  .........         777         777
                                     -------------------------------------------------------------------------------------------------------------------
      Moldova Total.................  ......................  .........  .........         972         972  .........  .........         777         777

    Russia..........................  FSA...................  .........  .........         750         750  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Russia Total..................  ......................  .........  .........         750         750  .........  .........  ...........  .........

    Tajikistan......................  FSA...................  .........  .........         510         510  .........  .........          28          28
                                     -------------------------------------------------------------------------------------------------------------------
      Tajikistan Total..............  ......................  .........  .........         510         510  .........  .........          28          28

    Ukraine.........................  FSA...................  .........  .........       1,218       1,218  .........  .........       1,195       1,195
                                     -------------------------------------------------------------------------------------------------------------------
      Ukraine Total.................  ......................  .........  .........       1,218       1,218  .........  .........       1,195       1,195

    Uzbekistan......................  FSA...................  .........  .........         600         600  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Uzbekistan Total..............  ......................  .........  .........         600         600  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Europe and Eurasia Total......  ......................  .........  .........       8,450       8,450  .........  .........       6,435       6,435
                                     ===================================================================================================================
Latin America and Caribbean:
    Ecuador.........................  ACI...................  .........  .........         100         100  .........  .........  ...........  .........
                                     -------------------------------------------------------------------------------------------------------------------
      Ecuador Total.................  ......................  .........  .........         100         100  .........  .........  ...........  .........

    Haiti...........................  DA....................  .........      1,400       1,000       2,400  .........      1,000  ...........      1,000
                                      ESF...................  .........  .........  ...........  .........  .........        300       1,000       1,300
                                     -------------------------------------------------------------------------------------------------------------------
      Haiti Total...................  ......................  .........      1,400       1,000       2,400  .........      1,300       1,000       2,300
                                     -------------------------------------------------------------------------------------------------------------------
      Latin America and Caribbean     ......................  .........      1,400       1,100       2,500  .........      1,300       1,000       2,300
       Total.
                                     ===================================================================================================================
Democracy, Conflict and Humanitarian
 Assistance:
    Office of Democracy and           DA....................      4,504      4,505  ...........      9,009      4,000      4,000  ...........      8,000
     Governance.
                                     -------------------------------------------------------------------------------------------------------------------
      Office of Democracy and         ......................      4,504      4,505  ...........      9,000      4,000      4,000  ...........      8,000
       Governance Total.
                                     -------------------------------------------------------------------------------------------------------------------
      Democracy, Conflict and         ......................      4,504      4,505  ...........      9,009      4,000      4,000  ...........      8,000
       Humanitarian Assistance Total.
                                     ===================================================================================================================
                                      ACI Sum...............  .........  .........         100         100  .........  .........  ...........  .........
                                      AEEB Sum..............  .........  .........       3,148       3,148  .........  .........       3,723       3,723
                                      DA Sum................      9,197      8,683       6,188      24,068      8,000      8,199       4,000      20,199
                                      ESF Sum...............      5,301  .........       1,700       7,001  .........        570       2,936       3,506
                                      FSA Sum...............  .........  .........       5,302       5,302  .........  .........       2,712       2,712
                                     -------------------------------------------------------------------------------------------------------------------
      Grand Total--USAID Human        ......................     14,498      8,683      16,438      39,619      8,000      8,769      13,371      30,140
       Rights.
--------------------------------------------------------------------------------------------------------------------------------------------------------


DEMOCRACY, GOVERNANCE AND HUMAN RIGHTS FUNDING (ALL-SOURCES)--NEAR EAST,
       EAST ASIA PACIFIC, AND SOUTH ASIA (INCLUDING CENTRAL ASIA)
                        [In thousands of dollars]
------------------------------------------------------------------------
                                                       Fiscal year
                                               -------------------------
                                                    2006         2007
                                                  estimate     request
------------------------------------------------------------------------
          Summary--Near East and Asia
Development Assistance........................       49,431       40,209
ESF...........................................      489,011      600,472
    USAID implemented.........................      299,426      390,152
    State/Global Programs.....................      189,585      210,320
    FSA--USAID & State Programs...............       40,384       34,303
    Democracy Fund (excl. HRDF)...............       12,673  ...........
    INCLE.....................................       27,590      286,425
    The Asia Foundation.......................        8,500        6,500
                                               -------------------------
      TOTAL...................................      627,589      967,909
                                               =========================
               Bilateral Detail
Development Assistance (DA):
    Afghanistan...............................       30,000       25,000
    ANE Regional..............................        2,028        3,225
    Bangladesh................................        3,465        2,550
    Cambodia..................................        2,331          910
    China.....................................        2,475          733
    India.....................................          326  ...........
    Nepal.....................................        1,485        1,500
    Pakistan..................................        3,597        4,000
    Philippines...............................        2,000          901
    RDM-Asia..................................          491          640
    Sri Lanka.................................        1,233          750
                                               -------------------------
      DA Subtotal.............................       49,431       40,209
                                               =========================
Economic Support Fund (ESF)--USAID
 implemented:
    Afghanistan...............................       58,000      136,000
    Bangladesh................................        4,752        5,000
    Cambodia..................................       11,375       13,500
    East Timor................................        6,000        4,000
    Egypt.....................................       85,505       86,455
    India.....................................          200  ...........
    Indonesia.................................       31,850       20,000
    Iraq......................................  ...........       25,000
    Jordan....................................       14,000       12,000
    Lebanon...................................        7,000       10,000
    Mongolia..................................        2,400        1,900
    Morocco...................................        6,440        8,000
    Nepal.....................................          990        1,000
    Pakistan..................................       20,000       27,000
    Philippines...............................        6,500        7,999
    RDM-Asia..................................        3,564        3,500
    Sri Lanka.................................        2,000        1,300
    West Bank and Gaza \1\....................       36,850       25,500
    Yemen.....................................        1,109        1,998
                                               -------------------------
      ESF Subtotal--USAID.....................      298,535      390,152
                                               =========================
Economic Support Fund (ESF)--State/Global
 Programs:
    Iraq......................................       55,440       87,270
    S. Asia Regional..........................          990        2,000
    MEPI......................................       99,000      120,000
    Laos......................................  ...........          250
    EAP Regional Women's Issues...............          990          800
    UNHCHR Nepal..............................        1,485  ...........
    HRDF......................................       31,680  ...........
        China.................................       19,800  ...........
        Muslim--outside Middle East \2\.......       11,880  ...........
                                               -------------------------
          ESF Subtotal--State/Global..........      189,585      210,320
                                               =========================
Assistance for the Independent States of the
 Former Soviet Union (FSA)--USAID implemented:
    Eurasia Regional..........................          590          840
    Kazakhstan................................        5,797        4,480
    Kyrgyz Republic...........................        4,794        6,226
    Tajikistan................................        4,596        4,274
    Turkmenistan..............................        1,090        1,100
    Uzbekistan................................        3,810        3,582
                                               -------------------------
      FSA Subtotal--USAID.....................       20,677       20,502
                                               =========================
Assistance for the Independent States of the
 Former Soviet Union (FSA)--State implemented:
    Eurasia Regional..........................        8,038        7,410
    Kazakhstan................................          555          538
    Kyrgyz Republic...........................        6,200        2,349
    Tajikistan................................        1,390        1,497
    Turkmenistan..............................          680          810
    Uzbekistan................................        2,844        1,197
                                               -------------------------
      FSA Subtotal--State.....................       19,707       13,801
                                               =========================
Democracy Fund:
    NED programs:
        China.................................        2,970  ...........
        Tibet.................................          248  ...........
        N Korea...............................          990  ...........
    Other Country Programs:
        Thailand..............................        1,980  ...........
        Iran and Syria........................        6,485  ...........
                                               -------------------------
          Subtotal Democracy Fund.............       12,673  ...........
                                               =========================
International Narcotics and Law Enforcement
 (INCLE):
    Afghanistan...............................       26,500       38,000
    Indonesia.................................          515          525
    Iraq......................................  ...........      247,600
    Philippines...............................          350          300
    Thailand..................................          225  ...........
                                               -------------------------
      INCLE Subtotal..........................       27,590     286,425
------------------------------------------------------------------------
\1\ Notional--program currently under review.
\2\ Programs may also be implemented outside of Asia.

 STATE DEPARTMENT/USAID DEFINITION OF DEMOCRACY AND GOVERNANCE PROGRAMS

    Democracy and governance programs are technical assistance and 
other support to strengthen capacity of reform-minded governments, non-
governmental actors, and/or citizens in order to develop and support 
democratic states and institutions that are responsive and accountable 
to citizens. They also include efforts to promote democratic 
transitions in countries that are not reform-minded.
    Programs are organized around core concepts considered the key 
building blocks of democracy. Democracy programs promote the rule of 
law and human rights, transparent and fair elections coupled with a 
competitive political process, a free and independent media, stronger 
civil society and greater citizen participation in government, and 
governance structures that are efficient, responsive and accountable.

                   COORDINATION OF DEMOCRACY PROGRAMS

    Question. Within USAID and State, who specifically has authority 
over democracy programs, and how do USAID and State currently 
coordinate to ensure that democracy programs support U.S. policy 
objectives? How about coordination with the National Endowment for 
Democracy? What are your plans to improve this coordination?
    Answer. The Director of Foreign Assistance has authority over all 
foreign assistance, including democracy programs. State and USAID are 
reforming foreign assistance processes to ensure that they advance the 
Secretary's transformational diplomacy goal of, ``Helping to build and 
sustain democratic, well-governed states that will respond to the needs 
of their people and conduct themselves responsibly in the international 
system.'' The reform has identified five primary objectives toward 
achieving this goal, of which one is supporting states to ``govern 
justly and democratically.'' All State and USAID programs in democracy 
will advance this objective in a manner that supports the Secretary's 
goal. At present, coordination with the National Endowment for 
Democracy (NED) is performed in Washington primarily through State's 
Bureau for Democracy, Human Rights and Labor, through which the NED 
receives its Congressional appropriation as well as additional 
Washington funds. Coordination in the field is done through the 
respective embassies and USAID missions. USAID works closely with the 
NED core institutes, such as the International Republican Institute 
(IRI) and the National Democratic Institute (NDI) both on policy issues 
and field operations with respect to the programs USAID manages.

                             DEMOCRACY FUND

    Question. Last year, Senator Leahy and I created a new ``Democracy 
Fund'' account as a first step to improve the conduct and management of 
democracy, governance and rule of law programs by consolidating 
activities under a single account. Do you support the Democracy Fund?
    Answer. I support the objective of the Democracy Fund. I concur 
that we need to improve the conduct and management of democracy, 
governance and rule of law programs, in addition to programs in other 
sector areas. As Director of Foreign Assistance, my aim is to bring 
increased coherence, accountability and transparency to the use of our 
foreign assistance resources. I look forward to sharing with the 
Committee our progress in this regard.

               DEMOCRACY AND GOVERNANCE PROGRAMS IN CHINA

    Question. Understanding you inherited the fiscal year 2007 budget 
request, how do you justify the inadequate request of $733,000 for 
democracy and governance programs in China?
    Answer. I agree we should be taking every reasonable opportunity to 
advance democracy in China. State's Bureau for Democracy Human Rights 
and Labor supports a $20 million/year democracy promotion program in 
China--USAID's request was to continue a modest Development Assistance 
(DA) funded program with universities (and possibly expanding to NGOs). 
The $733,000 allocated to democracy and governance, out of a total of 
$5 million in DA for China, was allocated with the additional $20 
million in ESF for democracy in mind.

                                BRANDING

    Question. What is USAID's branding policy with respect to democracy 
assistance? Would you agree that there should be exceptions to 
branding--such as assistance provided to support elections?
    Answer. USAID's branding policy for assistance awards was 
established by federal rulemaking, including solicitation and 
adaptation of comments by USAID grantees, and is published at 22 C.F.R. 
 226.91. The published regulation anticipated Congress's concern by 
including seven ``presumptive exceptions'' under which branding is not 
required for programmatic reasons, including several that may apply to 
democracy programs, and one specifically that provides an exception if 
marking would ``compromise the intrinsic independence or neutrality of 
a program or materials where independence or neutrality is an inherent 
aspect of the program or materials, such as election monitoring or 
ballots, and voter information literature; political party support or 
public policy advocacy or reform; independent media, such as television 
and radio broadcasts, newspaper article and editorials; public service 
announcements or public opinion polls and surveys.''

                            USAID PERSONNEL

    Question. A number of key positions at USAID remain unfilled, 
including the Assistant Administrator for Management, the Assistant 
Administrator for Europe and Eurasia, and the Inspector General.
    Do you have a timeframe for when these positions may be filled?
    Answer. I share your concern. These positions are critical to the 
success of our new strategic framework. I expect that we will be able 
recommend nominees to the President's staff in the coming weeks.
    Donald Gambatesa was sworn in as Inspector General on January 17, 
2006.

                              CONTRACTORS

    Question. USAID relies on a number of institutional contractors at 
USAID who provide support services to bureaus and programs.
    Do you believe a conflict of interest exists for contractors 
working at USAID, and how do you ensure that they represent the 
interests of the Agency and not their employers?
    Answer. In the absence of appropriate safeguards and vigilance, 
there could be the potential for a conflict of interest. At USAID we 
take this issue very seriously and have worked to fully comply with the 
letter and spirit of the Federal Acquisition Regulation on 
Organizational and Consultant Conflicts of Interest (FAR 9.500) which 
limits certain activities that are vulnerable to such conflicts. Since 
1999 USAID has applied the FAR standards to organizations performing 
designs, evaluations and audits. When mitigation of a potential 
conflict is not feasible, USAID restricts follow-on work. These 
policies include solicitation and contract clauses as well as non-
disclosure agreements to assure contractors are aware of limitations. 
Contractors have a strong incentive to hew closely to the rules, as 
they are aware that any deviation could endanger their ability to 
compete on future contracts.
    Our best guard against these issues is awareness of the rules. We 
accomplish this through our annual ethics training as well as regular 
outreach trainings conducted by our General Counsel. While we expect 
our contractors to have corporate codes of conduct, our supplementary 
training helps sensitize contractor employees to unique vulnerabilities 
under Federal contracts. These include assuring that contractor 
employees are not privy to sensitive internal Government information.
    In addition to training and contract clauses, USAID Cognizant 
Technical Officers monitor vulnerabilities to conflicts of interest. 
The Ombudsman for USAID's Office of Acquisition and Assistance can 
address concerns raised by contractors and their employees. Finally, 
the Inspector General maintains a hotline that can be used if someone 
is concerned about an apparent conflict of interest.
                                 ______
                                 
              Questions Submitted by Senator Arlen Specter

                              TUBERCULOSIS

    Question. Tuberculosis [TB] is the leading cause of death among 
people who are HIV-positive, because of their weakened immune system. 
One-third of the more than 40 million people with HIV/AIDS are also 
infected with TB. In areas such as sub-Saharan Africa, up to half of 
AIDS related deaths are caused by TB.
    In fiscal year 2005, 1.8 percent of PEPFAR's funding was directed 
toward TB/HIV activities. In fiscal year 2006 this number grew to about 
2.5 percent of PEPFAR's budget. Given that TB is the leading cause of 
death of those infected by HIV/AIDS, do you plan to devote a larger 
portion of the PEPFAR budget towards programs designed to combat the 
threat caused by TB in the fiscal year 2007 budget?
    Answer. In fiscal year 2005, $19.3 million went to supporting TB-
related activities in the fifteen focus countries. That amount is 
planned to increase to $40.1 million in fiscal year 2006. In addition, 
$91.5 million in additional funds are planned to support other 
bilateral country programs in fiscal year 2006. Focus country funding 
is expected to increase in fiscal year 2007 as well. Fiscal year 2007 
Country Operational Plans are currently being produced and will be 
submitted for review in late 2006; these plans will set forth planned 
spending levels for TB/HIV activities in fiscal year 2007.
    The President's budget request also includes $91.3 million in 
fiscal year 2007 for support of TB activities in other bilateral 
countries. In addition, the U.S. Government is the largest donor to the 
Global Fund to Fight AIDS, Tuberculosis, and Malaria, contributing one-
third of the Fund's resources. The Global Fund finances essential HIV 
and TB programs in resource-limited settings. The Emergency Plan 
emphasizes TB care and treatment for co-infected patients be included 
in the country level plans, and it is considered and priority program 
area in guidance that has been provided to the countries in 
establishing their operational plans. The Emergency Plan supports 
programming that includes diagnosis of latent TB infection, treatment 
to prevent development of active disease, and general TB-related care. 
Because of the high rate of co-morbidity between TB and HIV/AIDS, we 
are also urging the counseling and testing facilities the United States 
supports to offer HIV testing to those who present with TB or other 
infectious diseases. The Emergency Plan has developed ``basic 
preventive care packages'' that include key support and preventive 
therapies. These packages include the tuberculosis treatment therapies 
mentioned above.
    The Emergency Plan will continue to work with its partner USG 
implementing agencies that have programs focusing on TB and malaria, 
coordinating those programs with the Emergency Plan efforts focusing on 
HIV/AIDS.

                              BLOOD SAFETY

    Question. Another problem facing in the developing world is the 
inability of medical providers to test blood to be used in blood 
transfusions for AIDS and other potentially deadly diseases. This 
problem is particularly acute in many sub-Saharan countries.
    PEPFAR is making tremendous efforts to address this problem in the 
program's fifteen focus countries. However, tainted blood is still a 
major problem in many non-focus countries in sub-Saharan Africa. What 
efforts do you propose to address this problem in non-focus countries, 
particularly those in sub-Saharan Africa?
    Answer. With the knowledge that turning the tide against global 
AIDS requires a global fight, the Emergency Plan supports HIV/AIDS 
programs in 108 countries in addition to the 15 focus countries. The 
Emergency Plan strategy is to develop lessons learned from the rapid 
scale-up of national integrated prevention, treatment, and care 
programs in the focus countries, and have the greatest impact possible 
in the countries most affected by HIV/AIDS. These lessons learned are 
being applied to non-focus countries, including those in sub-Saharan 
Africa, in an effort to put into practice the most successful and 
comprehensive programs.
    PEPFAR supports international blood safety organizations to partner 
with host countries in the development of comprehensive systems that 
include low-risk blood donor selection, blood banking, and blood safety 
training. The goal of these programs is to increase blood supply 
through donor recruitment. The programs also work to ensure blood 
safety through proper screening of donors and donated blood. Currently, 
the Emergency Plan supports:
  --National programs to improve the quality of blood supplies through 
        improved policies;
  --The establishment of laboratory facilities and commodity 
        procurement; and
  --Healthcare worker training and management for technicians needing 
        blood safety expertise.
    The Emergency Plan also provides technical assistance to support 
countries in implementing the foundational components of effective 
national blood transfusion services.

                          PERU COCA PRODUCTION

    Question. In April this year, I traveled to Latin America on a 
CODEL. While in Peru, I met with Susan Keogh, Director of Narcotics 
Affairs in Peru. Ms. Keogh informed me that approximately 400,000 acres 
are being deforested annually for the cultivation of coca and other 
plants. On average, there are approximately 40,000 to 100,000 coca 
plants per two acres, which require about two tons of chemicals to be 
used for their production.
    Since coca is very vulnerable to diseases, coca growers cover the 
coca with pesticides which are very deleterious to the environment. 
Some portions of these chemicals almost always find their way into 
rivers and streams, as coca must be cultivated close to a water supply.
    When I asked what efforts the Peruvian Government is taking to 
combat these problems, Ms. Keough remarked that the Peruvian government 
hardly focuses on this issue of cocaine and its effects on the 
environment.
    I noticed your fiscal year 2007 Budget Justification notes that, 
``Limited government presence in the highlands and jungle allows 
illegal coca cultivation . . . to flourish'' and that ``USAID 
strengthens state presence through programs to reduce coca 
cultivation.'' Could you elaborate on your efforts in Peru?
    Answer. As in so much of the South American region, the 
deforestation rates in Peru are abysmal, and while coca production does 
play a role in this, many analysts believe it is by far less a 
contributing factor than illegal logging and agriculture expansion. The 
relationship between coca cultivation and deforestation in Peru has 
declined rapidly in recent years as profitable legal crops have 
expanded the agricultural frontier. This has resulted in a legal 
agricultural market that dwarfs the illegal coca market in terms of 
total land use. Furthermore, according to the latest statistics, Peru's 
total coca crop, 120,000 acres, is declining.
    The primary threat of deforestation deriving from coca farmers, and 
other colonizers, is driven by poor agricultural practices that result 
in the complete loss of soil nutrients in just a few years. USAID/
Peru's Alternative Development Program directly addresses this threat, 
as described below in response to the last question. A lesser threat 
related to coca farming is posed by new farmers wishing to colonize new 
areas to grow coca. Nevertheless, compared to years past, the ``new 
colonizers'' are responsible for much less deforestation than 15 years 
ago. Andean Counterdrug Initiative [ACI] funding also addresses this 
issue by consolidating the Government of Peru's efforts to protect 
national parks and strengthen the sustainable forestry concession 
program as described below. Dissuading colonizers is also an important 
byproduct of programmed eradication and interdiction activities.
    Peru's coca production thrives in areas that present development 
obstacles and where the government has a very limited presence. In 
these neglected and generally impoverished areas, coca production and 
processing brings violence and lawlessness and provides a source of 
financing for remnants of terrorist groups that inhabit them. Given the 
charged and threatening atmosphere of narco-trafficking in coca-growing 
areas, traditional state services and development projects cannot rely 
on police presence which means that education, health, and private 
investment projects are very costly and difficult to implement. USAID 
strengthens state presence in these areas through a multi-pronged 
approach, supporting activities to reduce coca cultivation and promote 
licit alternatives, complemented by actions in local government 
strengthening, health, education, economic growth, and environment.
    A key component of the USG's comprehensive counter-narcotics 
strategy, USAID/Peru's Alternative Development Program operates in 
concert with other U.S. Government agencies, including the State 
Department's Narcotics Affairs Section and the U.S. Drug Enforcement 
Administration, as well as the Government of Peru [GOP], to reduce 
illegal coca production in Peru in a sustained manner. USAID pursues 
this goal principally through ``voluntary eradication,'' where coca-
growing communities sign an agreement with the GOP to pursue a licit 
lifestyle and destroy their own coca plantings. The GOP and USAID then 
support the community's transition to a licit lifestyle by providing 
development assistance based on the community's priorities. This 
assistance often takes the form of infrastructure (bridges, roads, 
schools, and health clinics). Many of the specific investments in 
communities are leveraging State presence where it did not exist 
previously. A school brings the Ministry of Education; a health center, 
the Ministry of Health; a bridge or a road forces the local governments 
to maintain the infrastructure. Alternative Development-supported 
projects provide an opening for government ministries to establish 
themselves in the communities and begin to provide traditional services 
to the local population.
    USAID interventions also assist coca producers in moving towards 
high-paying export crops like coffee, cacao, and palm oil production. 
These productive activities are catalyzing interest the private sector, 
making national and international businesses stakeholders in the 
Alternative Development Program. All activities are closely coordinated 
between local governments and community members, thereby reestablishing 
local governments' role as an effective and transparent governing body 
that addresses the needs of its constituencies. In addition, USAID 
interventions must pass an environmental review which works to mitigate 
any further degradation, and all USAID projects are required to use 
``best practices'' in land and agricultural management, as well as, 
minimize the use of pesticides. All forestry projects must be designed 
to be sustainable, to reduce future environmental problems.
    Question. What efforts is USAID involved in to combat not only 
coca, but the adverse impacts production of that illicit crop has on 
the environment?
    Answer. Fragile eco-systems are threatened by coca production and 
the rampant illegal logging in Peru. USAID promotes licit livelihoods 
through the reduction of poverty, the conservation of biodiversity and 
the implementation and enforcement of existing environmental legal 
frameworks in Peru. USAID interventions are also held to a strict 
standard including an environmental assessment before any projects 
begins and required environmental planning as the project is 
implemented. Most logging of Peru's precious timber stock is illegal 
and is often carried out in concert with narco-traffickers, as log 
trucks are often used to carry hidden stashes of drugs. Given that the 
forest sector is one of Peru's largest, untapped sources of jobs and 
export revenue, USAID's Environment Program is helping to formalize the 
forest sector. Activities include support to communities living in the 
coca growing areas to substitute coca cultivation with forest 
certification activities and increase their sales of licit certified 
wood products in Peru and the rest of the world. This includes efforts 
to not just protect forest land, but make it sustainable for the 
future.
    In nationally protected areas and parks, USAID programs work with 
local communities and the GOP to protect the eco-systems and develop 
natural resource management strategies that improve livelihoods while 
protecting these areas. Additionally, the program fosters greater GOP 
presence in protected areas by enabling municipal authorities to assume 
their roles in the implementation and enforcement of existing 
environmental legal frameworks that will prevent further expansion of 
coca into protected areas. USAID is also aware of the impacts to water 
quality that occur due to coca refinement. While the Mission does not 
have any programs in this area, it is aware of the Embassy in Bolivia's 
work to address it.
    Question. USAID's fiscal year 2007 request for Environment and 
Natural Resource funds for Peru is $3.070 million which is a 24.4 
percent decrease from fiscal year 2004. Further USAID's fiscal year 
2007 request for Alternative Development is down 14.5 percent over that 
same period. Can you explain this trend?
    Answer. Since 2001, overall development assistance to Latin America 
and the Caribbean has increased from $862,452,000 in fiscal year 2001 
to $1,696,841,000 in fiscal year 2007. The funding levels for the 
Andean Counterdrug Initiative have remained consistent between fiscal 
year 2004 through 2006. USAID recognizes the intrinsic relationship 
between the environment and coca production though and has therefore 
supplemented the environment programs with $2.8 million in fiscal year 
2005 and 2006 ACI funding.
    Question. I note that the Andean Counterdrug Initiative funds from 
Agriculture and Environment have increased from $2.9 million to $35.1 
million over this period of time--representing a 1,077 percent 
increase. Are any of these funds being used to mitigate the harm being 
done to the environment due to coca production?
    Answer. The appearance of the enormous increase in the agriculture 
and environment sectors with ACI is due to a definitional change in the 
funding codes during this last reporting period. Previously, we 
attributed the bulk of ACI funds to the economic growth sector under 
the ``other economic growth code''. A change in the code's definition 
last year made it necessary to attribute our ACI funds to the 
agriculture sector with the codes corresponding to ``Rural 
Development'' and ``Agriculture Production and Productivity.'' All ACI-
related activities remain the same.
    All of our agricultural and infrastructure activities follow strict 
standards designed to protect the environment and must undergo 
environmental impact assessments, including the use of integrated pest 
management techniques and organic production whenever possible. Farmers 
are taught to use sustainable agricultural practices that maintain the 
viability of their land and permit permanent cultivation, therefore 
eliminating the need to clear-cut jungle regions to access fertile 
land. The sustainable cultivation of long-term and profitable crops, 
combined with other social benefits, has been successful in preventing 
a return to coca cultivation and encourages these young and unstable 
communities (often they are `communities' in name only) to stay put and 
develop, linking up with local government rather than migrating deeper 
into the jungle and clear-cutting virgin forest for new coca fields.
    Over the last 4 years, ACI funding has helped prevent colonization 
by supporting sustainable forest management and park protection 
activities managed by USAID/Peru's Environment Program. These 
activities are specifically designed to prevent both illegal logging 
and coca colonization into delicate and still intact ecosystems in the 
upper and mid-Andean jungles where coca cultivation is focused.
                                 ______
                                 
               Questions Submitted by Senator Mike DeWine

                       WESTERN HEMISPHERE FUNDING

    Question. Mr. Administrator, how do you justify the dramatic 21.6 
percent cut in Development Assistance and Child Survival and Health 
funding from the fiscal year 2006 appropriated levels for the Western 
Hemisphere? Even if you compare fiscal year 2007 to the fiscal 2006 
request, it's still a cut of approximately 18 percent.
    Answer. Overall U.S. Government assistance levels for Latin America 
are not expected to decline in fiscal year 2007. Foreign assistance for 
the region has nearly doubled since the start of the administration, 
rising from $862 million in fiscal year 2001 to a planned $1.7 billion 
in fiscal year 2007. Reductions in the Development Assistance and Child 
Survival and Health requests are partially offset by increases in the 
request for ESF, which is $31 million more than the fiscal year 2006 
level. For additional consideration is the complete picture of U.S. 
Government resources going to the region. The Millennium Challenge 
Account will be providing significant resources, through Compact 
agreements, to Nicaragua ($175 million) and Honduras ($215 million), as 
well as through Threshold Country Program funding to Paraguay ($37 
million). The Millennium Challenge Account projects compliment our 
efforts by supporting economic growth, infrastructure, and other 
projects where USAID has been active in the past.

                    MILLENIUM CHALLENGE CORPORATION

    Question. The President's request includes $3 billion for the 
Millennium Challenge Corporation [MCC]. While the MCC does not fall 
directly under the authority of the Director of Foreign Assistance, the 
MCC consults with your office and you sit on the board as 
Administrator. Please explain your strategy for determining levels of 
other assistance if a country is MCC eligible. For instance, if a 
country receives a compact for a major infrastructure project, will 
that country be eligible to receive the same amounts of Development 
Assistance they had before becoming MCC eligible? I've heard concerning 
rumors that a blanket policy would be applied and it seems to me you 
may want to look at these issues on a country by country basis.
    Answer. My role in relation to the Millennium Challenge Corporation 
[MCC] as Director of Foreign Assistance is to coordinate the work of 
the MCC with other U.S. agencies involved in foreign assistance. 
Millennium Challenge Corporation staff participate on the country core 
teams where their programs are active. These country teams are meeting 
now to review country allocation levels and establish priority program 
areas for each recipient country. MCC participation with these teams 
allows for collaboration between the work the MCC is doing and other 
U.S. Government agencies. Their participation aids in assuring that the 
work of U.S. Government agencies complements each other in helping to 
achieve the Secretary's transformational diplomacy goal of, ``Helping 
to build and sustain well governed states that will respond to the 
needs of their people and conduct themselves responsibly in the 
international system.'' The final allocation of State and USAID funding 
will take into account the work of the MCC to ensure that our programs 
complement one another in achieving the Secretary's goal. We have not 
set guidance to preclude or include considerations of funding from one 
account or another as the country teams allocate their budgets. Their 
guidance directs them to develop a plan that will help the country 
advance in achieving the Secretary's goal, taking into account all U.S. 
Government foreign assistance resources, including MCC funds.

                             HAITI FUNDING

    Question. As you may know, I worked to include $40 million in 
additional funding for Haiti in the Senate passed fiscal year 2006 
supplemental. The conference report includes $20 million. As Director 
of Foreign Assistance and USAID Administrator, what are your plans for 
Haiti in the short-term? Have you met with the USAID Mission Director 
or the Ambassador yet?
    Answer. The U.S. Government will use the supplemental funds to help 
Haiti reduce internal conflict and provide the basis to rebuild by 
addressing key sources of stress and conflict in social, economic, and 
political spheres, notably through increasing access to primary health 
services and basic education, creating employment and rebuilding assets 
for sustainable livelihoods, and fostering improved rule of law and 
responsive governance. All interventions will be undertaken to achieve 
short-term visible and measurable results while still developing the 
capacity of institutions to sustain results.
    I would look forward to any opportunities in the near future to 
meet with both our Ambassador and our Mission Director.

              INTERNATIONAL DISASTER AND FAMINE ASSISTANCE

    Question. The International Disaster and Famine Assistance Account 
request for fiscal year 2007 is cut by $62 million from the fiscal year 
2006 enacted levels (including the supplemental funds). As you know, 
these are the emergency funds that save lives. In addition, there is 
evidence that the use of these funds in emergencies are some of our 
best PR efforts overseas. For the past few years, we've been relying on 
supplemental funding for these core humanitarian activities. I believe 
doing so is dangerous fiscal planning that limits critical activities 
that respond to the large number of natural and man-made disasters. Do 
you believe $349 million is sufficient to address the emergencies we 
know about such as Sudan, northern Uganda, Congo, and Indonesia as well 
as the unforeseen emergencies to come in fiscal year 2007.
    Answer. We have confronted a series of major disasters over the 
past several years. Supplemental appropriations have been essential to 
an effective response. At this point, we believe the requested level 
will be adequate and will allow us to respond effectively.
                                 ______
                                 
              Question Submitted by Senator Sam Brownback

                        U.S.-UKRAINE FOUNDATION

    Question. Congress has iterated its support for programs 
administered by the U.S.-Ukraine foundation, but USAID's decisions 
regarding funding for these programs has not reflected Congress' 
support. Is this lack of targeted funding for these programs a 
reflection of the general draw down of ESF funds for Ukraine, or have 
USAID country officials made these decisions for other reasons?
    Answer. First, before I answer your question, let me state for the 
record that our programs in Ukraine are funded predominantly through 
the Freedom Support Act (FSA) and not through ESF funds.
    USAID has funded the U.S.-Ukraine Foundation [USUF] since July 
1997, when USUF was awarded a non-competitive grant. This grant has 
been extended several times and the total award amount has increased to 
its current level of $22,245,918. The final extension to this grant has 
been made, taking it to July 2007, in accordance with the 10-year limit 
on USAID assistance instruments. During the period of this grant, 
USAID's funding level in Ukraine has dropped four-fold, from $163 
million in 1997 to $41 million in 2006. Nevertheless, USUF's average 
funding level has remained fairly consistent at about $2.2 million per 
year.
    USAID recognizes the importance and value of Ukrainian Diaspora 
groups and we hope to continue benefiting from their participation in 
the USAID assistance program. Since there are currently many active and 
capable Diaspora groups, we expect to select a future program 
implementer via a competitive process.
                                 ______
                                 
             Question Submitted by Senator Patrick J. Leahy

                                 RUSSIA

    Question. In July, the United States and other nations will be 
meeting in St. Petersburg for the annual G8 summit. Increased attention 
has been paid to this year's summit because Russia is hosting it.
    The irony of this gathering of democratic nations in Russia is that 
Russia is becoming increasingly un-democratic. It has been 2 years 
since President Putin won reelection with no opposition. Since then, 
the Kremlin has opposed the democratic movement in Ukraine, supported a 
blatantly manipulated election in Belarus, rolled back democratic 
reforms in Russia, and continued its heavy handed policies in Chechnya.
    The latest crackdown on democracy is a law requiring civil society 
groups in Russia to re-register with the Justice Ministry in order to 
exert greater control of their activities and finances.
    The President proposes to cut aid to Russia from $80 million in 
fiscal year 2006 to $58 million in fiscal year 2007. Almost none of 
this goes to the government. Shouldn't we be doing more, not less, to 
support democracy in Russia through civil society and the media?
    Answer. We are doing a great deal to support the democratic process 
in Russia. U.S. assistance in Russia supports democracy programs that 
encourage volunteerism and civic responsibility through support to a 
wide variety of both Russian and American non-governmental 
organizations. Programs help Russian citizens, especially young people, 
better understand and apply democratic values and more proactively 
exercise their civic rights and responsibilities. In particular, the 
United States supports Russian human rights organizations, independent 
media outlets and good governance watchdogs. The proposed fiscal year 
2007 budget level for Russia reflect the impact of competing priorities 
in a resource constrained environment.
    Our relationship with Russia will always be important for the 
United States. In the coming years, we intend to use foreign assistance 
to further our strategic partnership with Russia on areas of common 
interest such as countering terrorist financing, mitigating conflict in 
the North Caucasus, advancing implementation of Russia's local self 
governance law and strengthening the Russian judiciary. We also intend 
to support Russian reformers to help the country complete its 
transformation to an open, democratic society.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu

                  DISPLACED CHILDREN AND ORPHANS FUND

    Question. In fiscal year 2006, $3 million was appropriated for 
USAID in the State and Foreign Appropriations bill. The funds were to 
be used as a pilot project for orphans, displaced, and abandoned 
children. To date, I haven't seen any evidence the funds have been put 
to use.
    What has happened to these funds and please outline in detail what 
has been done with the funding for this very important project?
    Answer. It is the explicit mandate of USAID's Displaced Children 
and Orphans Fund [DCOF] to directly address the concerns outlined in 
the language of the State and Foreign Operations Appropriations Bill. 
This office is charged to prevent child abandonment, address the needs 
of orphans, displaced and abandoned children and provide permanent 
homes through family reunification, guardianship and domestic 
adoptions. USAID will meet or exceed the $3 million appropriated in 
fiscal year 2006.
    Of the earmarked $3 million, $1.5 million will be used to reduce 
the abandonment and separation of children in the Democratic Republic 
of the Congo. This program integrates two coordinated efforts that: (1) 
combine poverty alleviation, training of social workers, promotion and 
support of children's rights, and communications and outreach, and (2) 
ensure minimum care standards and increase the reinsertion of separated 
and abandoned children with their families through support and training 
to local non-governmental organizations (NGOs) and government 
institutions.
    The additional $1.5 million will be used to support programs in 
Ukraine and Georgia. The goal of the Ukraine program is to build a 
continuum of family care services for children who are at risk or 
outside of family care. This program includes activities designed to 
strengthen and develop systems of family preservation, foster care, and 
adoption. The DCOF program in Georgia is targeted to assist vulnerable 
families to improve their ability to care for their own children as 
well as strengthening and expanding local NGO and government capacities 
to promote the physical, cognitive, emotional and psychosocial well 
being of at-risk children.
    Question. In your new position, you will direct all foreign 
assistance. How will you use your position to advance the causes of 
orphans, displaced, and abandoned children in the developing world?
    Answer. Hundreds of thousands of children are separated from their 
families or are in danger of becoming combatants as a result of civil 
war. Millions of children work or live on the streets; and as many as 
40 million children will be orphaned in HIV/AIDS affected countries by 
2010.
  --I will work in the coming months with the Special Advisor on 
        Orphans and Vulnerable Children, who is located within USAID, 
        to implement a strategy that calls for a more effective and 
        coordinated U.S. Government response. Our initial findings will 
        be reported to the Congress in the next several months.
  --We need to collaborate closely with UNICEF and leading non-
        governmental organizations to formulate our response, and to 
        ensure that in countries that have completed National Plans of 
        Action for Orphans and Vulnerable Children, that resources are 
        made available and that results are monitored and documented.
  --The U.S. Government currently implements a number of effective 
        programs that make a huge difference in the lives of millions 
        of highly vulnerable children around the world. Programs are 
        located in Africa, Asia, Europe and Eurasia, and Latin America. 
        Activities include:
    --Expanding care and support programs for children affected by HIV/
            AIDS at the community level in countries hardest hit by the 
            epidemic;
    --Helping reintegrate child soldiers back into their families and 
            communities, and providing psychosocial support for these 
            children;
    --Providing vocational and educational opportunities for street 
            children and other displaced children;
    --Expanding effective community-level support for orphans;
    --Preventing increased disabilities through treating and preventing 
            blindness, and education and testing related to other 
            disabilities; and
    --Food from Public Law 480 and donations from the United States to 
            the World Food Program bring life-sustaining food to 
            millions of children annually.

                    CHILDREN IN CONFLICT AND CRISIS

    Question. What has happened to these funds and please outline in 
detail what has been done with the funding for this very important 
project?
    Answer. It is the explicit mandate of USAID's Displaced Children 
and Orphans Fund [DCOF] to directly address the concerns outlined in 
the language of the State and Foreign Operations Appropriations bill. 
This office is charged to prevent child abandonment, address the needs 
of orphans, displaced and abandoned children and provide permanent 
homes through family reunification, guardianship and domestic 
adoptions. USAID will meet or exceed the $3 million appropriated in 
fiscal year 2006.
    Of the earmarked $3 million, $1.5 million will be used to reduce 
the abandonment and separation of children in the Democratic Republic 
of the Congo. This program integrates two coordinated efforts that: (1) 
combine poverty alleviation, training of social workers, promotion and 
support of children's rights, and communications and outreach, and (2) 
ensure minimum care standards and increase the reinsertion of separated 
and abandoned children with their families through support and training 
to local non-governmental organizations [NGOs] and government 
institutions.
    The additional $1.5 million will be used to support programs in 
Ukraine and Georgia. The goal of the Ukraine program is to build a 
continuum of family care services for children who are at risk or 
outside of family care. This program includes activities designed to 
strengthen and develop systems of family preservation, foster care, and 
adoption. The DCOF program in Georgia is targeted to assist vulnerable 
families to improve their ability to care for their own children as 
well as strengthening and expanding local NGO and government capacities 
to promote the physical, cognitive, emotional and psychosocial well 
being of at-risk children.

                       MATERNAL AND CHILD HEALTH

    Question. Despite significant scientific advances, millions of 
children and their mothers still die from treatable and preventable 
causes in the developing world. Each year, more than 10 million 
children under age 5 die--40 percent of these deaths occur within the 
first month of life. More than half a million women die from pregnancy- 
and child birth-related causes each year. Although the United States 
has played a critical role in providing the funding and expertise that 
has saved lives in past, funding for low-cost, low-tech interventions 
has stagnated.
    Under your leadership, how would the U.S. Government address the 
millions of preventable deaths of children under 5 and their mothers?
    Answer. USAID will focus its efforts in countriesthat continue to 
have a high burden of preventable maternal and child mortality to 
maximize our impact on health. We will work with host country 
governments and partners to scale-up country-appropriate packages of 
high-impact interventions, such as childhood immunizations, oral 
rehydration therapy, household water disinfection, vitamin A, antenatal 
care, and active management of the third stage of labor. By 
coordinating closely with other USG initiatives, such as the 
President's Malaria Initiative, and with other donors, such as the 
United Nations Children's Fund [UNICEF] the Global Alliance for 
Vaccines and Immunizations [GAVI], and the Global Fund to Fight AIDS, 
Tuberculosis and Malaria, we will be able to complement other funding 
in such a way that maximizes impact on maternal and child survival, 
health and nutrition. Finally, we will concentrate our new investments 
in emerging areas, such as neonatal health, in order to accelerate the 
decline in infant and child mortality.

                         CONCLUSION OF HEARINGS

    Senator Brownback. Thank you very much. That concludes our 
hearings.
    [Whereupon, at 4:02 p.m., Thursday, June 8, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]
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