[Senate Hearing 111-]
[From the U.S. Government Publishing Office]



 
  STATE, FOREIGN OPERATIONS, AND RELATED PROGRAMS APPROPRIATIONS FOR 
                            FISCAL YEAR 2011

                              ----------                              


                        TUESDAY, APRIL 20, 2010

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:35 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Patrick J. Leahy (chairman) 
presiding.
    Present: Senators Leahy, Landrieu, Gregg, Bond, and 
Brownback.

               U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT

STATEMENT OF DR. RAJIV SHAH, ADMINISTRATOR

                 STATEMENT OF SENATOR PATRICK J. LEAHY

    Senator Leahy. I know there are several other hearings 
going on and people are at different places. Dr. Shah, welcome 
to the subcommittee. We'll talk about your budget request, and 
I might say and I've told you this privately, I sincerely 
appreciate the fact that a person of your intellect and 
enthusiasm has taken on this job.
    I think I told you one of the first times we talked, I 
wasn't sure whether to offer you congratulations or 
condolences, but on behalf of the country I'm glad you're 
there.
    I don't envy you the job because USAID is in urgent need of 
reform and it is a formidable task and if it's not fixed, there 
are those who are going to ask whether USAID as it is should 
continue. I think every member of this subcommittee supports 
USAID's mission in one way or another, but I've heard on both 
sides of the aisle increasing concern about the performance of 
the agency.
    That doesn't diminish in any way the many extraordinary 
USAID staff or ignore the important and often life-saving work 
which they and USAID's implementing partners around the world 
do to help improve the lives of people in some of the world's 
poorest countries.
    We provide billions of dollars for USAID's programs and 
operations. So it stands to reason that a lot of that money is 
being used to positive effect. But I don't think USAID is 
living up to its potential of what--and I can say this to you 
directly because you have the task of fixing what was done 
wrong before--the U.S. taxpayers and this subcommittee expect 
it to do.
    Like many government bureaucracies, USAID suffers from a 
culture of arrogance that it knows best. Too often, it seems 
more comfortable dealing with elites of foreign countries than 
those people who have no voice. There is a disturbing 
detachment between some USAID employees in missions overseas 
who spend much of their time in comfortable offices, behind 
imposing security barriers, living in relatively high style, 
and the impoverished people they're there to help, so much so 
that it's hard to wonder how you can make a connection.
    I have nothing against suitable working and living 
conditions. We provide the funds for that. What concerns me is 
the way in some places USAID has become an ivory tower, distant 
from the trenches, writing big checks for big contractors and 
high-priced consultants and churning out self-serving reports 
filled with sometimes incomprehensible bureaucratic jargon.
    I've read them and I've sometimes wondered what did they 
say and, you know, English is my first language and they are 
written in English and I can't understand them.
    Now there are many USAID staff and often they're former 
Peace Corps volunteers who love to be out in the field doing 
hands-on work implementing, overseeing programs, but that's 
become more the exception, not the rule.
    I also often hear the frustration of creative people who 
want to help, have so much to offer, but then they end up 
facing a closed door, and a closed mind, at USAID. They face a 
labyrinth of reporting requirements that are burdensome or 
almost a way of saying we don't need you.
    I think USAID has to change its culture, change the way it 
does business, if it wants the kind of money that you're here 
asking for. If it doesn't change I will not vote for money for 
USAID and if I'm not going to vote for it, there are a lot of 
other people who may not.
    I'll have some questions about your budget and I say this 
in this subcommittee, in the Senate, Republicans and Democrats, 
you will not find stronger supporters of your mission among the 
men and women on this subcommittee than anywhere else in the 
Senate and we want nothing more than for you to tell us how you 
plan to reform USAID.
    So here's your chance, in plain English. Put your full 
statement in the record. But just tell us how are you going to 
make these changes and how are you going to restore USAID's 
image on Capitol Hill?
    So over to you, Dr. Shah.

                  SUMMARY STATEMENT OF DR. RAJIV SHAH

    Dr. Shah. Thank you, Senator, and thank you, Mr. Chairman.
    I want to first start by recognizing your deep commitment 
to USAID's mission. I've had the opportunity to participate in 
some of your trips abroad from a distance when I was in a 
different role and I know the commitment you have to this 
mission supersedes any commitment to an institutional 
arrangement or a particular bureaucracy. I look forward to 
working with you to put a change agenda in place so that USAID 
does live up to your aspirations and mine and those of the 
thousands of people that are still involved in USAID programs 
around the world.
    I think this is an important opportunity. In many ways I 
consider this a once-in-a-lifetime or once-in-a-generation type 
of opportunity. The President, the Secretary, members of this 
subcommittee, yourself, and other Members of Congress have all 
called for a more effective, transparent, and capable 
development enterprise. I think that is a legitimate call in an 
environment where our world is more interconnected and people 
care more about the development mission.
    I'm excited about being at USAID because the agency has a 
rich legacy of successfully introducing the green revolution, 
of bringing oral rehydration therapy and other health solutions 
to millions of children, and of creating higher education 
institutions in parts of the world. I was just in Pakistan and 
met graduates that were proud to have been supported by U.S. 
generosity.
    I also fully understand the need for change in the way we 
do business. The examples are really everywhere. I was just in 
Afghanistan where some of our staff reported errors in their 
paychecks during a pay period. That's one example where our 
human resources system failed. There are others, but I think 
this highlights how acute the need is for performance 
improvement in many of our core operating functions.
    The planning, measurement, and capability to put together 
ideas and articulate them across the agency and, as you put it, 
relate to the reporting capabilities of the agency are very 
weak today. Having been here for a few months with a big 
interagency focus on Haiti, it took extraordinary measures for 
us to be able to produce the kind of data reporting and 
information on a daily and weekly basis so that our interagency 
colleagues could understand what's working and what's not 
working in the Haiti relief effort and try to fill gaps in 
assistance in a rapid way. We need to build better systems in 
that space.
    Our contracting model, as you highlight, needs real reform. 
I visited an institution just last week where we've provided 
about $4.5 million over probably 3\1/2\ years and have done 
wonderful work in supporting thousands of students to gain 
access to technical training in Afghanistan. At a cost of about 
$1,000 a student per year, they will graduate from a 2-year 
course and earn incomes of $300 to $500 a month in areas like 
the construction trades, electrical wiring, ICT, and computer 
programming, but we probably spent 35 percent more than we 
needed to in order to get that result. Having come from a place 
that had far fewer bureaucratic processes to address, I've seen 
development happen in a more efficient and a more direct way 
and think it can be done at USAID.
    You asked very specifically about a reform agenda that 
would better serve U.S. taxpayers and that is what we deeply 
believe in. Before the end of this month, we hope to roll out a 
new policy, planning, evaluation and budget capability at USAID 
that will allow us to be more accountable and make smarter 
decisions and real resource trade-offs, so that we're not just 
chasing every need in an environment where needs are endless. 
We've all been to settings where we are overwhelmed by the 
extent of needs, but we are focusing on those areas where we 
can get the most cost-effective impact and results for our 
investment.
    This summer I hope to launch a series of procurement 
reforms. This will not be easy because the agency has come to 
outsource a huge amount of work, including basic program design 
and program oversight activities, but we have a team in place 
to work on this issue. We've already put a Board of Acquisition 
and Assistance Review in place to review all contracts over $75 
million. We will take that further by developing specific 
detailed guidelines for procurement reform that are based on 
the premise that we should be doing much more work in-house, 
especially related to program design and oversight.

                           PREPARED STATEMENT

    And finally, we will focus on human resources and 
evaluation in a very substantive way over the course of the 
summer and the fall. I think if we do these things, sir, we 
will be a more accountable agency, a more transparent agency, 
and a more effective agency. I share your passion and urgency 
around these points and appreciate your guidance and your 
opening comment.
    [The statement follows:]

                  Prepared Statement of Dr. Rajiv Shah

                           INTRODUCTION/HAITI

    Chairman Leahy, Ranking Member Gregg, Members of the Subcommittee, 
I am honored to join you here today in support of the President's 
fiscal year 2011 foreign operations budget request.
    It has been less than 4 months since I was sworn in as 
Administrator for the U.S. Agency for International Development. As you 
know, just days after my swearing-in, the people of Haiti were struck 
by a tragedy of almost unimaginable proportions. The United States--and 
the American people--responded swiftly and aggressively to this 
unprecedented disaster--a response that reflected the leadership and 
compassion of our nation.
    In the immediate aftermath of the earthquake in Haiti, President 
Obama designated me as the Unified Disaster Coordinator and charged our 
government with mounting a swift, aggressive and coordinated response. 
In that capacity, USAID coordinated the efforts of the Departments of 
State, Defense, Homeland Security, and Health and Human Services. We 
worked collaboratively with the Government of Haiti and a host of other 
governments, the United Nations, other international organizations, 
NGOs, the private sector, and with thousands of generous and concerned 
individuals. Together we have provided a comprehensive response to a 
complex disaster whose scope far exceeds any other that the 
Administration has faced internationally and one that requires a 
continued aggressive and unique approach.
    Our unprecedented level of coordination in response to these 
challenges has shown results on the ground. With our partners, we 
launched the largest, and most successful international urban search-
and-rescue effort ever--with more than 135 lives saved by over 40 
countries' search and rescue teams in Haiti. In coordination with 
Haitian authorities, our military, the United Nations, and NGO 
colleagues, we created a fixed distribution network to surge food 
distribution to nearly 3 million people--the most robust urban food 
distribution in recent history. Within 30 minutes of landing on the 
ground, the U.S. military secured the airport, and in the hours that 
followed, rapidly expanded its capacity to well beyond pre-earthquake 
levels. The United States also helped to restore a critical sea port, 
thereby scaling up the delivery of essential goods and restoring 
commercial capacity. And our partners at the Department of Health and 
Human Services provided medical assistance that enabled an additional 
30,000 patients to receive treatment.
    Nevertheless, we all know that Haiti faces a long and steep road to 
recovery. Reconstruction will take time and will require the shared 
commitment and resources of our international partners, working in 
concert with the Government and the people of Haiti.
    We are requesting a total of $1.6 billion for the Department of 
State and USAID in supplemental funding for efforts in Haiti. Of that, 
approximately $501 million will be used to reimburse USAID for the 
emergency humanitarian response already provided through International 
Disaster Assistance and Food for Peace Title II. Of the funding 
requested in the supplemental for reconstruction , $749 million is 
requested for the Economic Support Fund to support Haiti's critical 
recovery and reconstruction needs, including rebuilding infrastructure, 
supporting health services, bolstering agriculture to contribute to 
food security, and strengthening governance and rule of law. Finally, 
we have requested an additional $1.5 million for USAID's Office of the 
Inspector General to ensure greater oversight of these funds.

                    GUIDING PRINCIPLES AND OVERVIEW

    Recovery in Haiti will continue to be a major focus for the 
foreseeable future. But we will not lose sight of the important work of 
strengthening USAID and helping other countries achieve their 
development goals. Investment in development has never been more 
strategically important than it is today. Even in the midst of 
difficult economic times domestically, helping nations to grow and 
prosper is not only the moral obligation of a great nation; it is also 
in our national interest. The investments we make today are a bulwark 
against current and future threats--both seen and unseen--and a down 
payment for future peace and prosperity around the world.
    As Members of this Subcommittee know very well, development is an 
essential pillar of our foreign policy. As President Obama said in Oslo 
last December, ``Security does not exist when people do not have access 
to enough food, or clean water, or the medicine and shelter they need 
to survive.'' Building the capacity of countries to meet these basic 
needs--and in turn, increasing dignity and opportunity for their 
people--is what guides our work and the resources we put behind it.
    While the scope and complexity of the world's challenges have 
grown--from the food crisis to the global financial crisis, terrorism 
to oppression, climate change to pandemics--we have never had the 
technology, tools and global imperative for action that we have today. 
Together with other government departments and agencies, USAID is 
examining our policies, resources, and capabilities to determine how 
best to achieve our development objectives through the Presidential 
Study Directive on U.S. Development Policy and the Quadrennial 
Diplomacy and Development Review. And already, we are moving to face 
these challenges, guided by the following important principles:
  --Working in partnership, not patronage with the countries we serve;
  --Coordinating across U.S. agencies and among donors and partners for 
        maximum impact;
  --Ensuring strategic focus with targeted investments in areas where 
        we can have the greatest impact with measurable results and 
        accountability;
  --Embracing innovation, science, technology and research to improve 
        our development cooperation; and
  --Enhancing our focus on women and girls.
    The fiscal year 2011 budget request will support development 
priorities that contribute directly to our national security. 
Specifically, our request is focused on three priority areas:
  --Securing Critical Frontline States.--$7.7 billion in State and 
        USAID assistance will support U.S. development efforts in 
        Afghanistan, Pakistan, and Iraq.
  --Meeting Urgent Global Challenges.--$14.6 billion in State and USAID 
        assistance will support local and global solutions to national 
        and transnational problems, including global health, food 
        security, poverty, disasters, and threats of further 
        instability from climate change and rapid population growth.
  --Enhancing Aid Effectiveness and Sustainability.--$1.7 billion will 
        support the ongoing rebuilding of USAID personnel and 
        infrastructure.

  SECURING CRITICAL FRONTLINE STATES: AFGHANISTAN, PAKISTAN, AND IRAQ

    By far the largest component of our requested budget increase is 
dedicated to the critical states of Afghanistan, Pakistan and Iraq. We 
have made some progress in each of these countries, but we realize that 
significant challenges remain.
    Over the past several years, our focus in Afghanistan has been 
achieving greater stability and security. Working within a fully 
integrated civilian-military plan, our goal is to create space for 
economic investment and to lay the foundation for a more 
representative, responsible and responsive government. We believe these 
investments are key to providing sustainable security and stability in 
Afghanistan.
    We are gradually delivering more of our resources through public 
and private Afghan institutions and these efforts have been successful 
so far. We are performing careful and diligent oversight and directing 
resources to local institutions and partners who perform well.
    We are beginning to see major improvements in the Afghan healthcare 
system. In 2002, just 8 percent of the population had access to some 
form of healthcare, but by 2009, that number had increased to 84 
percent.
    We have also made significant strides in education. Under the 
Taliban, only 900,000 boys and no girls were officially enrolled in 
schools. As of 2009, more than 6 million children were enrolled, 35 
percent of whom are girls. One of our biggest economic accomplishments 
in Afghanistan has been to begin to rejuvenate the agricultural 
industry. In November of last year, with USAID support, Afghan 
provincial farmer associations sent to India the first shipment of what 
is expected to be more than 3 million kilograms of apples this season.
    USAID has also been active in developing a coordinated Afghan 
energy policy, and helped advance new electricity generation capacity 
and provide 24-hour power for the first time in cities including Kabul, 
Lashkar Gah, and Kandahar City. With additional resources, we expect a 
half million people will benefit from improved transportation 
infrastructure.
    In Pakistan, our request supports ongoing efforts to combat 
extremism, promote economic development, strengthen democratic 
institutions, and build a long-term relationship with the Pakistani 
people. We are focusing on programs that help demonstrate the capacity 
of local civilian governance to meet the Pakistani people's needs, and 
channeling assistance to less-stable areas to rebuild communities and 
support the Government of Pakistan's counterinsurgency efforts.
    USAID and our partners in Pakistan have made progress in several 
areas. In 2009, we expanded educational opportunities, rebuilt schools 
and increased support for higher education. We trained 10,852 
healthcare providers, 82 percent of whom were women, and provided 
essential care to nearly 400,000 newborns. Over the life of our 
program, we have helped treat 934,000 children for pneumonia, 1.6 
million cases of child diarrhea, and provided DPT vaccines to 731,500 
babies through training programs for healthcare workers.
    We have also focused on generating economic opportunities for the 
people of Pakistan, contributing to the country's stability. USAID 
programs generated more than 700,000 employment opportunities in 2009, 
including training more than 10,000 women in modern agricultural 
techniques.
    The funding increase in fiscal year 2011 for Pakistan will help 
USAID reach approximately 60,000 more children with nutrition programs, 
increase enrollment in both primary and secondary schools by over 1 
million learners, and support 500,000 rural households to improve 
agricultural production.
    Finally, turning to Iraq, we have transitioned to a new phase in 
our civilian assistance relationship--shifting away from reconstruction 
toward the provision of assistance to bolster local capacity in line 
with Iraqi priorities. Indeed, we are working in partnership with the 
Government of Iraq whose investment in their own development matches or 
exceeds at least 50 percent of U.S. foreign assistance funds.
    Specifically, USAID is promoting economic development, 
strengthening the agricultural sector, which is the largest employer of 
Iraqis after the Government of Iraq, and increasing the capacity of 
local and national government to provide essential services. For 
example, USAID is strengthening public administration, strategic 
planning and project management in critical Iraqi ministries by 
supporting 180 international post-graduate scholarships in programs 
related to public administration for Iraqis at universities in Cairo, 
Amman, and Beirut. The additional funding requested will also promote 
small and medium enterprise growth, strengthen the Iraqi private 
banking sector and increase access to lending for entrepreneurs engaged 
in new market opportunities resulting from improved stability.

                    MEETING URGENT GLOBAL CHALLENGES

    In addition to supporting these critical frontline states, we are 
targeting investments to assist with urgent global challenges that--if 
unmet--can compromise the prosperity and stability of a region or 
nation.
    First, global health, where we are requesting $8.5 billion in State 
and USAID assistance. Our request supports President Obama's Global 
Health Initiative, which builds on the President's Emergency Plan for 
AIDS Relief (PEPFAR), launched by the Bush Administration, and other 
U.S. global health programs and will help our 80 partner countries 
strengthen health systems and sustainably improve health outcomes, 
particularly for women, children and newborns. This initiative will be 
carried out in collaboration with the Department of State and the 
Department of Health and Human Services to ensure our programs are 
complementary and leave behind sustainable healthcare systems that are 
host-country owned.
    With additional funding, we will build on our strong record of 
success in HIV/AIDS, TB and malaria, and achieve results where progress 
has lagged, in areas such as obstetric care, newborn care and 
nutrition. The initiative will include a special focus on up to 20 
countries where we will intensify efforts to ensure maximum learning 
about innovative approaches for working with governments and partners, 
accelerating impact and increasing the efficiency and effectiveness of 
U.S. government investments.
    Second, to support global food security, we propose investing $1.2 
billion for food security and agricultural programs, in addition to the 
$200 million set aside for nutrition programs that support the goals of 
improved global health and food security. These funds are in addition 
to the emergency and non-emergency food assistance we provide. There is 
a strong link between security and hunger, made clear in 2008 when the 
global food price crisis led to a dramatic rise in food riots in more 
than 30 countries around the globe. With these additional funds, we 
will work in countries in Africa, Central America, and Asia to combat 
poverty and hunger. Our work will draw upon relevant expertise across 
the United States government to deliver the most effective programs 
possible.
    Our third principal challenge is climate change. We propose to 
invest $646 million in our programs, part of the Administration's 
overall request of $1.4 billion to support climate change assistance. 
USAID will support implementation of adaptation and sustainable 
landscape investments, as well as low-carbon development strategies, 
market-based approaches to sustainable energy sector reform and 
emission reductions, capacity-building and technologies to enhance 
adaptation and local resilience to climate change in partner countries. 
We plan to expand renewable energy programs in the Philippines, 
improving electric distribution systems in Southern Africa, and support 
high-level bilateral climate change partnerships with major economies 
like India and Indonesia.
    Finally, we remain focused on humanitarian assistance, including 
emergency and non-emergency food aid, where USAID and the Department of 
State propose to use $4.2 billion. The tragedy in Haiti brings clarity 
to both the critical need for America's leadership on humanitarian 
assistance and the strong support from the American people that such 
efforts enjoy. This funding allows us to assist internally displaced 
persons, refugees, and victims of armed conflict and natural disasters 
worldwide.
    With the combined investments proposed in global health, food 
security, climate change and humanitarian assistance, we will build the 
capacity of countries to save lives and, through economic growth, help 
make people less vulnerable to poverty and the threat of instability 
that extreme poverty can represent. In so doing, we honor our basic 
values, strengthen our national security and promote our national 
interests.

             ENHANCING AID EFFECTIVENESS AND SUSTAINABILITY

    All of the priorities I have outlined require well-trained 
personnel and robust infrastructure. We must treat development as a 
discipline. This requires strong capacities in evaluation, planning, 
resource management, and research to ensure we are incorporating best 
practices. At the same time, we must be able to recruit, hire and 
retain best in class development professionals.
    As we build our workforce, we must reclaim the Agency's historical 
leadership in science and technology. We must also strengthen USAID's 
capacities to identify, implement, and rigorously evaluate new and 
existing approaches that reward efficiency, effectiveness, and 
sustainability. We must have the capacity to analyze, plan, and invest 
strategically for the long term. And most important, we must stay 
relentlessly focused on results--which means establishing baseline 
data, measuring progress, being transparent about both our successes 
and our failures--learning from both and improving our approach as we 
go forward.
    Our fiscal year 2011 budget request represents a vital investment 
in our human resources, and I want to thank the Committee for its 
foresight and support for the Development Leadership Initiative. The 
additional resources requested will allow us to bring on 200 new 
Foreign Service Officers, furthering our goal of doubling the size of 
our Foreign Service Corps. Fields of particular focus are education 
officers, economists, agriculturalists, stabilization, governance and 
reconstruction officers, global health officers and evaluation experts.
    This long-term investment in human resources is critical to help 
fill a shortage of experienced middle- and senior-level technical 
experts and managers. Equally important, by reducing our reliance on 
contractors to design and evaluate programs, we will not only save 
taxpayer dollars but also enable greater oversight and more effective 
program implementation.
    Through these critical investments, we can achieve the development 
goals we have set around the world and restore USAID's standing as the 
world's premiere development agency.

                               CONCLUSION

    Our objective each day is to seek out these best practices, learn 
from them, and adapt them to everything we do. We are committed to 
transparency in both our successes and our failures--viewing both as 
opportunities to learn and improve.
    I know this is a time of great economic strain for so many 
Americans. For every dollar we invest, we must show results. That is 
why this budget supports programs vital to our national interests. The 
United States must be able to exercise global leadership to respond to 
crosscurrents of a complex world. This requires the effective use of 
all instruments of our national security--including development. We 
agree strongly with President Obama and Secretary Clinton's vision of 
embracing development as indispensable to American foreign policy and 
national security.
    It is through this relentless dedication to results that we do 
justice to our motto, ``from the American people.'' We do this not just 
by extending a helping hand, but by sharing the hopefulness of the 
American dream in places where hope remains shrouded by poverty, 
oppression and despair.
    In many cases, the balance between a future filled with fear and a 
future filled with hope is fragile. Every day, USAID tips the scale 
toward hope and opportunity.
    Thank you very much.

    Senator Leahy. Thank you. I, and I believe most people 
here, want USAID to succeed, but you talked about outsourcing 
and some of the other things that are being done.
    You said local hires are not being paid, but I'm sure that 
USAID employees, their paychecks came, and--no?

                             PAYROLL ISSUES

    Dr. Shah. There were problems with payroll for the Foreign 
Service Limited (FSL) employees--differentials not paid, pay 
caps imposed, among other issues. The Foreign Service National 
staff and other employees are being paid and have not had 
payroll issues.
    Senator Leahy. So that, it was a mechanical thing, this was 
not a case of money that ran out. Am I right?
    Dr. Shah. Correct. It was entirely related to our internal 
process and we've already made that fix for that particular 
problem.

                          POLITICAL APPOINTEES

    Senator Leahy. How many of your political appointees and 
other top positions are still waiting for final approval by the 
White House? What are you hearing as far as getting them 
approved?
    Dr. Shah. We've made 36 political appointments that have 
joined and are currently working at the USAID. We've submitted 
62 names to the White House. A number of the Senate-confirmed 
individuals are through an initial process where I believe 
they're on to the second stage of review and vetting. For me 
it's an incredible priority to make sure we get a series of 
names up to the Senate so we fill the slate, but those are the 
numbers in terms of the progress we've had.
    Senator Leahy. So you still have some that haven't gone 
through the vetting at the White House?
    Dr. Shah. Thirty-six have joined and are onboard. Of the 
Senate-confirmed, roughly one-half of them are through an 
initial vetting process but that only gets concluded when the 
White House, of course, announces the formal appointments.

                                 AFRICA

    Senator Leahy. There was an Op-Ed in last Sunday's New York 
Times by Bono entitled ``Africa Reboots.'' Did you have a 
chance to read that?
    Dr. Shah. I did, sir.
    Senator Leahy. For the others, it described his 
conversation with different African political leaders, artists, 
and entrepreneurs during a recent trip around Sub-Saharan 
Africa focused on aid and trade, governance, corruption, 
transparency, enforcing the rule of law, rewarding measurable 
results, and so on.
    I know the trip was exhausting but one that he found very 
worthwhile, and he and I talked about it.
    Is there anything in that, in his comments that would have 
relevance for USAID and the way you do business in Africa and 
other parts of the world?
    Dr. Shah. Yes, sir, I believe so. The fundamental point he 
was making in that Op-Ed was that he believes Africa is in a 
place where there is strong innovative and capable leadership 
in government, in the private sector, and in civil society, and 
what I took away from the article was that it is incumbent upon 
us to find those change agents and those leaders and do the 
types of things that empower them to be successful and build on 
their capacity to offer real leadership.
    We've seen that in a number of ways. The article talked 
about the Mo Ibrahim Prize that essentially does that for very 
high-level African presidential leadership. I was at the Bill 
and Melinda Gates Foundation for nearly 8 years and we 
certainly got a lot of credit in that setting for finding 
innovative leaders and empowering them to be successful.
    One of the things I noted, and I shared this with part of 
the USAID team that runs a program called the Development 
Credit Authority, is in many cases the initial organization 
that found and supported the leaders that we were then helping 
to take to the next level, was USAID and USAID programs, USAID 
missions, and networks that had developed over many, many years 
of being present in countries. I think there is a base of 
capability and leadership and knowledge regarding who's capable 
of offering real leadership, no matter what sector they come 
from. USAID has connections and networks that we can build on 
using some of the tools that are already at our disposal, like 
the Development Credit Authority, and other tools to support 
private sector and civil society organizations.

                       USAID'S PROCUREMENT SYSTEM

    I think our procurement process almost systematically 
excludes a lot of local leaders from being real participants in 
our efforts and that needs to be fixed in order to really help 
us be successful.
    Senator Leahy. Well, in fact, there's been a lot of delays 
in launching the USAID's worldwide procurement software and 
system. This predated you being there, but it was scheduled to 
be completed in March 2008. I think now it has a completion 
date of June 2011 at a cost of around $100 million.
    Are you confident it's going to be completed?
    Dr. Shah. That's what I'm told. Part of what we're doing is 
looking at the full range of procurement tools we have as part 
of this procurement reform that I hope to announce in June.
    Senator Leahy. Well, let me pick up on that.
    If you call a mission abroad and they say, well, Dr. Shah's 
on the phone, get the mission director, you say how are things 
going, and you're told everything is fine.
    To what extent can you get objective information? Do you 
have confidence that you can get that kind of feedback if 
something isn't working, whether it's procurement, which 
obviously didn't work with your predecessor because it wasn't 
completed, but what's your level of confidence that you can 
hear bad news as well as good news?
    Dr. Shah. Well, you know, this may be surprising, sir, but 
it is high in the sense that I do hear regularly a fair stream 
of bad news. Some of it is related to mistakes that were made 
in following process and some of it is externally created 
mishaps that result in a poor outcome.
    My goal is to give people the space to come to me sooner 
with an identification of when those kinds of problems are 
likely to happen, as opposed to coming to me with ``we screwed 
up'' after the fact. Even in that area, I'm encouraged.
    I was recently in Afghanistan and we built a series of what 
I call data dashboards, which sector by sector identify four to 
five key metrics that would allow us to track our spending in 
that context, and whether it is having the impact we expect and 
having--and I know this is very mechanical, a small red, 
yellow, or green light indicator against each metric so you can 
see if we're spending x amount of money in the education 
sector, are we improving the attendance rates for girls, 
educational quality and building capacity in the ministry in 
the sector that needs to sustain this effort. I found the 
dialogue there was very rich, very honest.
    People want to come forward with what they're struggling 
with. If we can create the space for that and if we can create 
a culture that celebrates identifying what's tough and coming 
up with innovative ways to address it head-on, I think the 
people and the staff are ready to stand up and participate in 
that.

                                 HAITI

    Senator Leahy. Well, one good example would be how 
objective a response you can get on our response in Haiti. 
There are a number of things that went right. There are a 
number of things many of us feel went wrong, and I would like, 
once you've had an evaluation of knowing what went right and 
what went wrong, I would like to sit down with you and see how 
objective a picture you got because we're going to also have 
questions in Afghanistan, Pakistan and elsewhere, different 
problems, of course, different situations, but I want to know 
how objective the reports are that you receive.
    Dr. Shah. Sir, I would look forward to the opportunity to 
do that. We're engaged in a number of after action reports in 
that regard.
    I would just add that during the crisis and, of course, 
it's an ongoing one, on a daily or weekly basis we were having 
the dialogue around which sectors were working more effectively 
and which ones were not. Areas like sanitation and hygiene in 
particular, efforts to move and resettle individuals who were 
at risk of the floods and the rains, and we were able to 
rededicate ourselves and bring additional resources to help 
address some of those sectors that were going slower.
    So I appreciate the reporting that took place in that 
context, but I understand your point is a more fundamental one 
and I look forward to that opportunity.
    Senator Leahy. Thank you very much. We've been joined by 
Senator Gregg. I'll yield to you and then we'll get to Senator 
Landrieu.
    Senator Gregg. Thank you, Mr. Chairman. Thank you. 
Unfortunately, I apologize, Dr. Shah, I'm going to have to 
leave quickly for another meeting.
    But, first, I want to associate myself with the chairman's 
opening remarks. I think he's raised a number of very 
significant and important red flags for the agency, and this 
subcommittee has a very deep interest in making sure those are 
addressed. It's a bipartisan interest and I hope you'll respond 
to those concerns aggressively.

                        FISCAL YEAR 2011 BUDGET

    Second, just a quick question: I look at the resources that 
are available and everything you folks want to do and they 
don't match. Let's even assume that you get significant 
increases--which is going to be difficult in the climate that 
we're functioning in--but you've got the Millennium Challenge 
Corporation (MCC), you've got the Feed the Future Initiative 
(FTF), and you've got the U.S. President's Emergency Plan for 
AIDS Relief (PEPFAR), and I don't see how you do any of those 
three in as robust a way as you're suggesting under the 
resources that are going to be available.
    So I'd like to get a sense of how you think you're going to 
do that.
    Dr. Shah. Well, thank you, Senator. I would just say in a 
generic sense we recognize the need to do a better job of 
setting priorities and especially country by country, narrowing 
the number of sectors we might work in so that in each of those 
sectors we can build real technical excellence, stay committed 
for 5 or 10 years, and see the kind of big transformative 
outcomes we hope to see.
    So part of my leadership, I hope, over time is to narrow 
our focus in countries to those specific sectors that we think 
are most important in those particular countries and in a way 
that is consistent with how our resources are provided to us.
    Senator Gregg. Take, for example, PEPFAR and MCC. They're 
supposed to be 10-year-type initiatives and yet I look at your 
budget and I'm wondering, well, they're just sort of being 
atrophied a bit and replaced with this FTF Initiative.
    Dr. Shah. Well, sir, with PEPFAR in particular, I could 
talk through how we're approaching that because we have 
launched, as you know, the global health initiative and it's 
our real aspiration to try and get much more efficiency out of 
the aggregate U.S. Government global health spending.
    So when we add up PEPFAR and CDC spending and USAID 
spending in the global health sector, I think the total budget 
request is a little bit over $8 billion for 2011.
    You know, I just saw data coming out of Ethiopia and 12 
other countries where we did a substantive data call. There are 
real opportunities to be more efficient in getting this work 
done. There are environments where we'll buy a viral load 
analyzer and put it in an environment where we're serving very 
few patients and there's a better way to do that.
    There are opportunities for us to integrate our work and by 
integrating our work across these various programs, to do a 
better job of providing skilled attendants at birth and 
reducing maternal mortality or do a better job of providing 
those specific prioritized interventions, like rotavirus and 
pneumococcal conjugate vaccines, for children to go after the 
big categories of unyielding child mortality.
    So I think our goal is to sort of look at the whole 
portfolio and identify how we can be more efficient in spending 
those resources while also achieving the direct disease 
outcomes.
    Senator Gregg. Dr. Shah, unfortunately, I have to leave. 
What I'd like to get from you, if you possibly can do this, is 
take your four or five biggest categories and you've just 
listed two of them, throw in MCC and FTF, and tell me what's 
the 2 year, 3 year, 5 year, 7 year, and 10 year projection for 
what you expect those categories to accomplish, how you expect 
them to be funded, and how you expect the funding of the 
categories to interrelate with each other in the context of the 
very stringent budget that we're facing. I'd appreciate that.
    I apologize for having to run.
    Dr. Shah. We will do that. Thank you.
    [The information follows:]

                       Largest Funding Categories

    Most USAID programs, as well as independent agencies such as MCC, 
do not have firm multi-year budget plans beyond the amount requested 
for fiscal year 2011. Such plans are of course subject to the 
availability of funding provided in the annual appropriations process. 
In the case of major development assistance initiatives, the President 
has committed to seek predictable multi-year funding, which will be 
critical to achieving those initiatives' goals. USAID is currently 
implementing the majority of funding in three of these--the Global 
Health Initiative, the Feed the Future Initiative, and the Global 
Climate Change Commitment.
  --Global Health Initiative (GM).--The President committed to provide 
        $63 billion over 6 years to this expanded and comprehensive 
        global health effort. Enacted appropriations from the GHCS 
        account (both State and USAID portions) for fiscal year 2009 
        and 2010 and the President's budget request for fiscal year 
        2011 total $23.6 billion, leaving $33.4 billion to be funded 
        over the remaining 3 years of the initiative (fiscal year 2012-
        2014) ($6.4 billion is to be funded from other accounts).\1\ By 
        2015, the GHI aims to reduce mortality of mothers and children 
        under five, saving millions of lives; avert millions of 
        unintended pregnancies; prevent millions of new HIV, 
        tuberculosis and malaria infections; eliminate some neglected 
        tropical diseases; and strengthen local health systems.
---------------------------------------------------------------------------
    \1\ Roughly 60 percent of the PEPFAR budget allocated to State is 
implemented through USAID.
---------------------------------------------------------------------------
  --Feed the Future Initiative.--The President committed at least $3.5 
        billion to this initiative over 3 years (fiscal year 2010 
        through 2012). The enacted appropriation for fiscal year 2010 
        and the President's budget request for fiscal year 2011 total 
        $2.7 billion, leaving $0.8 billion to be funded over the 
        remaining year of the initiative. Additional funding would be 
        required in fiscal year 2012 through fiscal year 2015 in order 
        to achieve the goals of significantly reducing global poverty, 
        hunger and under-nutrition laid out in the Administration's 
        ``Feed the Future Guide,'' released by Administrator Shah on 
        May 20.
    Global Climate Change Initiative.--The President committed, along 
with other developed countries, to provide approaching $30 billion in 
international climate finance over fiscal year 2010-2012. As part of 
this commitment, the USG also committed to provide $1 billion to REDD+ 
(Reducing Emissions from Deforestation and Forest Degradation Plus) 
between 2010-2012, and we are working to meet that goal. The enacted 
appropriation for fiscal year 2010 and the President's budget request 
for fiscal year 2011 total $2.4 billion in direct climate funding, plus 
additional funding from other agencies and co-benefits from other 
assistance programs. Because the United States did not commit to a 
specific percentage of this total amount, future international climate 
funding will be determined through the fiscal year 2012 and subsequent 
budget processes. The USG also committed with other developed counties 
to jointly mobilize $100 billion per year in international climate 
finance by 2020 in the context of meaningful mitigation actions and 
transparency from developing countries; this funding is intended to be 
a mix of public and private funding streams, and our out-year budgets 
will contribute toward the public finance portion of that goal.

    Senator Leahy. Senator Landrieu.
    Senator Landrieu. Thank you, Mr. Chairman. Dr. Shah, thank 
you so much for being present this morning and for being so 
accessible. I've enjoyed our conversations on several 
opportunities since you've been in your current position and 
I'm impressed with your background and your enthusiasm for what 
you're doing.
    I do have, though, some questions and issues I'd like to 
raise before I get into the specifics on Haiti which you and I 
spoke about on my return just last week.
    I'd like you to clarify for me and, Mr. Chairman, if the 
staff here can help, I'm having a little difficult time with 
the numbers in front of me understanding what exactly is your 
budget entailing. I see different figures. Is it $21 billion 
out of the total $52 billion? Could you just say what your 
understanding is of the amount of money under the control of 
USAID in this budget for this coming year 2011?
    Dr. Shah. I believe it is approximately in that area.
    Senator Landrieu. $21 billion, roughly $21 billion out of 
$52 billion?
    Dr. Shah. Correct. And I think one of the things we're 
doing as part of putting in place a slightly reformed budget 
process is we will be able to do a better job of identifying 
those resources that are specific to USAID programs.
    The current process for budgeting doesn't break it out that 
way. So it's been difficult for me to get an answer to that 
question in a way that's valid. That figure doesn't necessarily 
include resources that might come to us through an MCC 
threshold program or PEPFAR or other funding streams.
    Senator Landrieu. Well, then I'm glad it's not just me, Mr. 
Chairman, because my staff and I have been working on this for 
weeks and I'm glad that the head of the agency is having 
difficulty. Well, I'm not happy that the head of the agency is 
having difficulty understanding the budget that he's tasked to 
manage, but it makes me feel better because we've been trying 
to break these numbers out to no avail.
    But I think, Mr. Chairman, it's extremely important for 
this subcommittee, in order for us to continue our focus on 
helping to reform USAID and working for it to become a more 
effective agency as it is our primary arm of bilateral support 
to our allies and friends around the world, to really get a 
handle on it and to be able to break it down so we ourselves 
can understand where our focus needs to be.
    Senator Leahy. It might also help with the State Department 
to let them know exactly where their money's going, too.
    Senator Landrieu. Well, absolutely.
    Senator Leahy. I say this in defense of Dr. Shah.
    Senator Landrieu. You know, absolutely. I think it's just 
critical, which brings me to my questions about Haiti.

                    ORPHANS AND VULNERABLE CHILDREN

    There's no question that there were some important steps 
taken. The government and the officials that I met with down 
there were very appreciative of everything that the United 
States and the international partners had done in terms of life 
saving and distribution of food, et cetera, but as you are 
personally aware, the challenges to Haiti are just enormous, 
from just basic delivery of services, water, sanitation, 
housing, education, and I went down there with several Members 
particularly focused on children, all children but particularly 
vulnerable children, potentially orphaned children, and came 
away with a couple of thoughts about how we might want to 
proceed and wanted to ask you if you had some knowledge of the 
work going around the effort to provide for the first time in 
Haiti a universal free pre-K through 12 school system which may 
be shocking for people to know doesn't exist in Haiti today.
    It might be one of the reasons why they're the poorest 
nation in our hemisphere because they virtually have no 
fundamental school system accessible to most families and that 
the families that are sending their kids to school are sending 
them to inadequate, poorly staffed, non-certified teachers in a 
private setting which isn't in itself a problem, except when 
it's inadequate, and using a great deal of their small salary, 
which may be $2 a day, if that much, to fund the education of 
their children.
    Does USAID have a position about the importance or priority 
of this, and could you comment on your interest in potentially 
maybe targeting this as an area that we could see some real 
improvement?
    Dr. Shah. I do. Thank you, Senator. I think, in part based 
on our conversation, we also are trying to identify specific 
budget line items that sit in sectors that are called housing 
or social services that would be education-related and pulling 
that out to back up what I'm about to say with the budget 
numbers.
    But the reality is we are committed to an education 
strategy in Haiti. We have for a number of years been working 
against a single multi-donor strategy that has really pulled 
the resources of donors together against a strategy that was 
primarily focused on primary education and the number of kids 
that had access to primary education and then secondarily 
focused, although many of our resources went into this, on 
teacher training and a number of other efforts to improve the 
quality of education in those environments.
    That was between $12 and $20 million a year, depending on 
which funding streams we count and we had every intention of 
continuing that going forward pre-earthquake.
    Given the earthquake, there's obviously a huge need for 
reconstituted infrastructure and schools and we have built the 
budget for that into the housing budget and I do think that's 
an area where we want to share with you the assumptions we used 
in the budget planning but we really do recognize the need and 
our capacity to help fill the current gap by engaging in 
building schools that could serve as a platform for a broader 
range of services.
    Senator Landrieu. Well, I would just suggest, Mr. Chairman, 
the members of our subcommittee, that as we look out into the 
reconstruction of Haiti, that helping the Haitian Government 
and working with international partners, I understand Canada 
and France want to help lead this effort, to put down as a 
cornerstone a free universal education system for Haiti 
accomplishes many goals, one of which, high on my agenda, is to 
prevent childhood abandonment.
    The hundreds of thousands of orphans, Mr. Chairman, that 
are in Haiti is because families in many instances give their 
children up hoping they can get an education at one of these 
over-crowded orphanages. They're both maybe as familiar as they 
should be with the horrific circumstances, even in the best run 
of orphanages, that that's not happening.
    So that's, you know, one point, and if I could make my 
second point, I'm also concerned about USAID budget generally. 
In thinking about serving children, Dr. Shah, separate from 
their families, thinking about the importance of feeding 
children, providing their health, their education in and 
through families as opposed to sort of separate revenue streams 
that don't support the permanency issue that are so important 
to children, either to stay with the families to which they're 
born or to try to promote through the international laws that 
we now have developing adoption, both domestic and 
international.
    So I'd just ask you when you look at your budget think 
about if you're serving children separate from their families, 
which is not the way we do this in the United States. Our 
system isn't perfect, but our programs serve children in and 
through families which keeps our abandonment rate relatively 
low, keeps our adoption rate relatively high, okay, and so 
that's just my final point about the way we structure our 
programs is serving children in and through families, and I'll 
come back to a second round.
    Thank you.
    Senator Leahy. Senator Brownback.
    Senator Brownback. Thank you, Mr. Chairman. Dr. Shah, good 
to have you here, and, Mr. Chairman, my last appropriations 
cycle, I want to recognize you and your longstanding commitment 
to these difficult issues around the world. You've hung in here 
for years and done a great job of it and I really want to 
recognize and acknowledge that.
    Senator Leahy. Well, Senator Brownback, on my time, I 
appreciate that very much. You've worked with me on landmines 
and on so many other issues and on issues of poverty, of health 
around the world, something that you don't see in Kansas, I 
don't see in Vermont, but part of our common humanity, we 
respond to and I applaud you for what you've done on that.
    Senator Brownback. Thanks. Thank you. Dr. Shah, I want to 
raise a couple issues, if I can with you.

                                 SUDAN

    This is the watershed year for Sudan on the Comprehensive 
Peace Agreement. They had the vote. It seemed like some 
questionable issues happened on the presidential vote, but as 
you know, the referendum on the south happens in January 2011. 
I mean, this is the big deal and my sense is that you probably 
will see the south separate from the north and they're going to 
need a lot of help if they're going to sustain it.
    This Comprehensive Peace Agreement's been one of the great 
successes, I think, of foreign policy for the last decade or so 
for us that took a 20-year conflict in Africa and has ended. 
I've been involved in the issue. I'm sure you have. Yet you've 
cut the economic support funding for Sudan going into this 
watershed year and I really hope you look at other ways you can 
support that.
    I don't know if you've been in the south of Sudan yet 
yourself. If you haven't, I would sure urge you to put it high 
on your priority list. Great people, wonderful folks, but this 
is the big one and they're going to need you guys' help and 
focus.
    I've got a couple of other issues I want to raise with you, 
but I hope that's something you can do. Have you been into the 
south of Sudan yet?
    Dr. Shah. Not yet, sir, but I am planning to visit there in 
about 1 month.
    Senator Brownback. Good, good. You need to and they need 
us.

                      NEGLECTED TROPICAL DISEASES

    On neglected diseases, this is an area that Senator Sherrod 
Brown and I have worked a lot on on getting a priority review 
process so that you can get some of the neglected diseases that 
so hit the Third World countries and this is kind of building 
off of Senator Gregg's comment about where are you--how are you 
going to do all this with the money you've got, and I like your 
heart and I like your attitude, but there is a resource issue 
here and it's unlikely to get a whole lot bigger just in the 
near term.
    Having said that, I'm the ranking member on the Agriculture 
Subcommittee which has Food and Drug Administration (FDA) and 
we're pushing FDA to do a shortened pathway for neglected 
diseases as a way of reducing the cost of these things and 
trying to get more investment in them.
    I hope you can take a look at that and back this cause 
because this is the way we can get our marketplace to help fund 
these neglected diseases that typically hit the Third World and 
have very small markets. We can't afford to have a process that 
costs $700 million to develop a drug that has a market 
potential of a $150 million. I'm pulling that number out of the 
air but not the first number and that is being pursued by FDA 
now and if you were to get and your agency backing of that and 
get involved in this review process, we've got a special 
committee that's set up to do this, good people on it, that can 
be a big help and I think it's one where we can start to 
whittle away at some of these neglected diseases that cost us 
so much.

                              AGRICULTURE

    A final issue I wanted to throw out to you was the 
Department of Homeland Security (DHS) and USDA is building a 
National BioAgriTerrorism Facility. That may sound like a long 
ways away from your work but a good portion of the diseases 
they're going to study are animal diseases that come out of the 
Rift Valley. I think actually maybe as many as 10 of 12 are 
their primary targets.
    I think this is a chance for us to network with 
veterinarians trained in Africa and that region to scale up 
their ability or help train them because it helps us and then 
you're off of somebody else's budget, as well, and Department 
of Homeland Security's which is a great place to be because 
that's one we tend to think, well, okay, let's put more money 
in this one and I think there's a good chance that we could 
build some upscale programs of training better veterinary 
medicine people in Africa to be eyes and ears for us and help 
develop awareness of when some of these things are breaking out 
or what's coming because the Rift Valley has been such a deadly 
zone for some really nasty things coming out.
    But we can use it to train up a level of people that can go 
back and do great things in a country. Part of the Green 
Revolution was Norman Borlaug training a generation of plant 
geneticists in the Third World. Why can't we do that toward 
animal agriculture, particularly in Africa, that is a source of 
their wealth and revenue for so many people and do it under our 
security umbrella so it helps leverage your dollars?
    I point these out as ones that I think are key for us 
moving forward on some really meaty areas and I'm hoping in 
particular you can help us out with Sudan. I said I was going 
to end with that, but there's one final thought.

                    DEMOCRATIC REPUBLIC OF THE CONGO

    Senators Durbin, Feingold, and I sent you a letter on 
Congo, Eastern Congo. We've been involved in the conflict 
commodity issue in that area. I think it's at the core of 
stabilizing Congo and probably four countries in that region if 
we can get the conflict commodities out of the means of 
commerce that funds the rebels in the regions. Similarly, it's 
the blood diamonds of east Africa is what this amounts to.
    We asked you to look at putting on a mining specialist to 
really help track some of these issues and work on them. I hope 
you can look at it because I think it's really key for us to 
get Congo and probably, as I mentioned, four countries in that 
region more stabilized so we get less money going to the 
protagonists that are in that region.
    That's a lot, but I wanted to throw that out to you.
    Dr. Shah. Thank you. Should I address that?
    Senator Brownback. Go ahead.
    Senator Leahy. Please. I know you've also had some 
firsthand experience with the Green Revolution. So please go 
ahead.
    Dr. Shah. Well, thank you. On Sudan, I appreciate the 
comments. I look forward to getting out to our offices there as 
soon as possible. We've provided, as you know, sir, $95 million 
in support for the election and the referendum activities, 
including some of the monitoring activities that have been more 
visible in recent days.
    We are very focused on expanding support for local 
governance and local service delivery in the south in 
anticipation of how important such activities will be in the 
future, and I would just use this as an opportunity to 
highlight the fact that our mission in Juba, as you know, has 
nearly 17 U.S. direct hires and PSCs and 75 Foreign Service 
Nationals--professional and support staff, which makes us 
really the largest organized donor presence in that 
environment.
    We recognize the responsibility that comes with that to 
work with partners, including the World Bank and other donors, 
to try to mobilize efforts in a very connected way to those 
local leaders that have capacity there.

                      NEGLECTED TROPICAL DISEASES

    On neglected tropical diseases, I completely agree with 
your point about a shortened development and approval cycle. I 
will follow up directly with Administrator Hamburg on that and 
I think there are also opportunities to work with the World 
Health Organization which has the mandate for those types of 
governing regulations for most of the countries where we would 
introduce those.
    The only thing I would add is that often the firms we work 
with in this space benefit from having simple market 
introduction plans, a thoughtful demand analysis, and a 
forecast for how product would get to needy populations and so 
sometimes small investments in those types of activities can 
unlock real private sector innovation and activity and we will 
follow up on that.

                             FOOD SECURITY

    And finally, on the question with respect to USDA and DHS, 
I'm actually quite familiar with that particular facility and I 
agree. I think there are tremendous opportunities with Rift 
Valley livestock diseases and with veterinary training which, 
of course, large vet gaps are a big gap here in the United 
States and abroad.
    As part of our Food Security Initiative, we've allocated 
$145 million for agricultural-related research for fiscal year 
2011. A significant proportion of that would be executed in 
partnership with USDA and used in the livestock area where they 
do some unique work, both related to this facility and more 
broadly. So I look forward to moving that forward. I think that 
is a critical and completely unaddressed opportunity in the 
food security space.
    And finally, on Congo, I agree and, in addition, we've been 
working on following up based on that letter and will continue 
to share information with your office, but thank you.
    Senator Brownback. Mr. Chairman, thank you for the extra 
time.
    Senator Leahy. Thank you, Senator Brownback.

                              PROCUREMENT

    The thought occurred to me when we were talking earlier 
about how you evaluate these contracts. What's your largest 
contract? Say $10, $50, $100 million?
    Dr. Shah. I think significantly larger than that, sir. I 
don't know which ones are the largest, but I've seen several 
that are several hundred million dollars.
    Senator Leahy. Then I would keep the pressure on to get 
that. The system that was supposed to be ready in 2008, long 
before you were there, to get it ready, and I hope you 
understand when I ask these questions, I think you are and will 
be an inspiration to the people in USAID. There are some superb 
men and women working at USAID. There are many who worry about 
the mission being overwhelmed by bureaucracy. They want you to 
give them the direction. They want to break through. They want 
to do the things that inspired them to come to USAID in the 
first place and so we're putting in your lap years of neglect 
and problems and say please fix it.
    And you will have the support here to fix it. Senator 
Brownback mentioned neglected diseases, something that this 
subcommittee actually started focusing on about 5 years ago and 
now it has become, both in the last administration and this 
administration, an important priority and please keep it a 
priority.
    You're being asked to increase your staff and programs in 
Afghanistan, Pakistan. Both countries face severe security 
threats. They have weak governments, endemic corruption, 
inadequate housing and office space for USAID personnel. And 
you can't get USAID staff out in the field to monitor programs 
because of the obvious security problems.
    We learned in Iraq that spending lots of money quickly can 
end up withy a lot of fraud and waste. Now Afghanistan, the 
tribal areas of Pakistan, I can see the potential and I'm sure 
you can for enormous corruption and waste.
    How do you get a handle on that and protect the men and 
women who have to manage these programs?

                              AFGHANISTAN

    Dr. Shah. Well, thank you, sir. Having just returned from 
Afghanistan, I can attest to the fact that our more than 400 
USAID staff there that are working as part of the overall 
mission experience, all of the things you just described, 
threats to their personal security, challenge around their 
ability to be mobile in areas where programs are active, and to 
some degree challenging housing situations, to say the least, 
but they are very committed to the work. In general, I think 
the way to address this is to break down our work into core 
sectors.
    In each sector, we are in the process of refining and 
developing a coherent strategic approach that clearly 
distinguishes between things we might do to achieve short-term 
security and stability objectives in the context of an active 
military campaign and how one builds a bridge to sustainable 
long-term development in those settings.
    To give you an example, I was in Arghandab, an area outside 
of Kandahar City, and in a 6-month period of time, through a 
combination of agricultural vouchers for inputs, some technical 
training, cash for work, short-term jobs programs,----
    Senator Leahy. Irrigation.
    Dr. Shah [continuing]. And improvements in roads and 
irrigation, we've seen a huge improvement in agricultural 
productivity in that particular area, an area that covers about 
35,000 people. Over a 6-month period those improvements have 
led, by all accounts, to significant improvements in the 
security and stability situation in that region, so much so 
that our military colleagues believe fewer kinetic operations 
will be required in that particular space as a result.
    But we know that we have much more to do to track those 
resources that are getting spent and to make sure that we have 
a glide path where over 2 or 3 or 4 years we can take that 
spending to an appropriate per capita level of investment so 
that the Government of Afghanistan and other partners can 
sustain it over the long run and that's been the focus of how 
that team is planning to take those programs forward.
    So I think it is doable. We just have to be focused on the 
right metrics as opposed to annual or monthly spend rates or 
something like that.
    Senator Leahy. Well, yes, I don't consider success based 
just on what the spend rate is, especially when you're in an 
area where so much can be stolen. I wish we could go to a 
website and find that x number of dollars has gone to this NGO 
near Kandahar or wherever it might be and here's what they're 
spending it on.
    Dr. Shah. I don't believe I can find that online today. I 
do think we ought to get to that point. Part of what we try to 
do is----
    Senator Leahy. I want to avoid what happened in Iraq where, 
you know, cargo planes full of money came in. Now we're still 
searching for the hundreds of millions of dollars that were 
stolen, probably billions of dollars, some by Americans, but 
certainly a lot by the people in the country we're helping.
    Dr. Shah. That's certainly a risk, sir, and I think we are 
trying to put in place a system whereby whenever we invest 
directly in a ministry or a local institution, we put in place 
a significant certification process and reserve auditing 
capabilities that allow us to track resources as they're spent 
in the health sector. The Ministry of Health in Afghanistan is 
perhaps a good example of that, where it took a number of years 
to build the actual financial disbursement and contracting 
mechanism in a transparent and accountable way and now we're 
able to flow more resources through that system. I think that's 
a model for what we're trying to do.
    Senator Leahy. Nothing would bring about more effort to cut 
off money if it turns out that it wasn't spent well and I'm 
not--and, Dr. Shah, understand that I'm not expecting you to 
have total success in everything you try.
    When I was a prosecutor, I used to tell the assistants in 
my office who would tell me they'd never lost a case, I'd say 
then you're not trying enough cases, and if you say we've never 
had a failure on any program, you're not taking enough risks. 
Imagine the number of things Dr. Borlaug tried before he got 
where he was. You worked for the Gates Foundation and they set 
some pretty tight controls about what's going to be successful, 
but they'll be the first to admit that sometimes things don't 
work.
    So keep trying. We're going to be coming back on Haiti and 
again I really want to see when you have more material on what 
worked, and what didn't. I will have more questions on 
Afghanistan and Iraq. I've been there and to Pakistan. I know 
the need, you've got some real, real problems there, and I look 
at, of course, Africa where we can do so much, provided the aid 
can get to the people.
    Senator Landrieu, you've been waiting patiently.
    Senator Landrieu. That's okay, Mr. Chairman. I'm very happy 
to follow your line of questioning and agree with your points 
and comments, and I, too, am very anxious for USAID to be 
reformed in a way that we can be effective, it can be 
expression of the values of the American people and their deep 
desire to be helpful and generous, but also their hesitancy to 
throw good money after bad, to not account for the millions of 
dollars they're contributing, and it's discouraging to them.
    This agency should operate in the most transparent, 
accountable way possible and when it operates that way, it 
encourages, I think, literally billions of dollars of private 
donations that Americans and American corporations and 
individuals, faith-based communities are willing to contribute 
to the effort, if they believe that it's being done in a 
comprehensive and strategic way, which brings me to one of your 
strategic efforts I want to commend and ask you to commend and 
that is coordinating across U.S. agencies and other donors and 
partners country to country.

                        INTERAGENCY COORDINATION

    My experience in visiting not nearly as many countries as 
the chairman but at least a half dozen, is the common complaint 
that USAID does virtually no coordinating among its own 
agencies, let alone other NGOs, and you must be aware, Dr. 
Shah, that there are somewhere between 900 and 1,000 
independent NGOs and IGOs operating in Haiti with virtually 
little coordination and again if USAID isn't stepping up to do 
that coordination, my question is is Canada or is, you know, 
France?
    If we are not trying to coordinate, is there a country in 
the world that is tasked with coordinating so that these public 
and private monies in every country can be spent more 
strategically, and is that a role that you want USAID to take 
on?
    Dr. Shah. Well, thank you for those comments. I think in 
Haiti, in particular, I'd just share one anecdote, that 2 days 
into the crisis and the earthquake we made a small grant to 
InterAction in order to help them set up a hub to coordinate 
the activities of NGOs through that context. I think it was a 
good first step and it made a big difference, both because it 
brought especially the largest international NGOs that are the 
conduit for large streams of funding from a range of partners 
to a single point of coordination and it gave us someone to 
engage with when we wanted to address the NGO community 
specifically.
    Through that effort they were also able to identify certain 
NGOs that, frankly, were doing things that were 
counterproductive, and relatively irresponsible in terms of the 
way they were distributing food or doing other things that 
didn't meet best practices.
    So I think that helped and that is an example of how USAID, 
through leveraging partners in that community, can do a better 
job of helping NGOs organize among themselves.
    The other comment I'd like to make on that is the Global 
Health Initiative, I think, is a good example of where we're 
actually trying to turn the coordination point into the 
relevant country ministry. So if you look at Ethiopia or 
Tanzania, what we would ultimately like to do is have the 
Ministry of Health in those places (a) be aware of what their 
NGOs and our implementing partners are doing in countries, (b) 
take some responsibility for offering direction to those NGOs, 
and (c) develop a financial sustainability plan so that there's 
some sense of who's going to provide these services in a 
sustained long-term way over 5, 7, or 10 years. I think if we 
can do those types of things, it will start to improve the 
coordination of those NGOs and, frankly, it will improve our 
partnership with countries who regularly complain that they 
don't know where our money is going and they don't know what 
we're doing in their country.
    Senator Landrieu. Well, I appreciate that and I heard in 
your answer that, yes, you're committed to organization and 
coordination and even more importantly or equally importantly 
trying to build capacity within the countries the appropriate 
ministries to be able to identify and coordinate some of those 
activities, and I know that would be very important to the 
Haitian Government that, frankly, in their view expressed to me 
feels overwhelmed with just identifying the number of different 
groups and NGOs and coordinating that effort and you want NGOs 
to be helpful but they're not a substitute for effective 
governance in country.

                                 UNICEF

    Number 2. I have been over the years getting more and more 
concerned about UNICEF which is one of our--I think we 
contribute, Mr. Chairman, over $100 million to UNICEF and 
despite my personal conversations with leaders of UNICEF over 
time, Carol Bellamy when she led the organization, Ann Veneman, 
and now the incoming director, Tony Lake, I'm concerned about 
UNICEF's position seemingly to be, despite comments to the 
contrary, their position against adoption, both in country and 
international.
    I want to know if you've come across any conversations with 
UNICEF or thoughts that you might have about ways that we could 
encourage UNICEF to understand the extraordinary capacity among 
families in the world, excess capacity, literally excess 
budgets within families, excess rooms within homes to take in 
orphans in an appropriate way when children are truly orphaned 
to give them a chance at a permanent nurturing family.
    Are you willing to maybe express some of these views to 
UNICEF or to work with me to kind of change a little bit of 
their outlook in this direction?
    Dr. Shah. Yes, Senator, I am, and we had a chance yesterday 
to meet with Tony Lake and I think he's also open to exploring 
what we can do differently to be more effective across the 
broad goal of child protection and using a broad range of 
strategies.
    I will say in Haiti, we had experiences where we worked 
effectively with UNICEF and experiences where things were 
challenging, but I do want to credit them with conducting a 
data collection exercise across the different institutions that 
were labeled orphanages that provided some basic data in what 
was otherwise a numbers-deficient environment to determine 
where the kids were, in which institutions, and how would we 
provide them with services. That sort of work did allow us, 
together with our military colleagues, to target those 
institutions for distribution of food and water in the early 
days of the crisis.
    So, you know, I think there are areas where they've done 
effective work and there are probably areas where there could 
be an expansion of the thinking.
    Senator Landrieu. Okay. Well, I'll look forward to working 
with you on that and just to finalize, the first lady of Haiti 
is extremely enthusiastic and excited and, of course, is a 
graduate of George Washington right here. The University 
Collaborative has really come together to support her and her 
work, really focused on this education opportunity for children 
in Haiti and for long-term development of Haiti, Mr. Chairman.
    I couldn't think of a better way to invest U.S. dollars and 
I think our taxpayers would agree to give a free quality 
universal education to the 4.5 million children in Haiti that 
really have no access today.
    Thank you, Mr. Chairman.
    Senator Leahy. Thank you. There are so many opportunities 
and sometimes with the simple things.
    Dr. Borlaug and I were friends and I admired him greatly 
and I look at what he accomplished, but also I had mentioned 
earlier the Op-Ed piece by Bono. In fact, without objection, 
I'll put that in the record at the end of this hearing.
    [The information follows:]

               [From The New York Times, April 17, 2010]

                             Africa Reboots
                               (By Bono)

    I spent March with a delegation of activists, entrepreneurs and 
policy wonks roaming western, southern and eastern Africa trying very 
hard to listen--always hard for a big-mouthed Irishman. With duct tape 
over my gob, I was able to pick up some interesting melody lines 
everywhere from palace to pavement . . .
    Despite the almost deafening roar of excitement about Africa's 
hosting of soccer's World Cup this summer, we managed to hear a 
surprising thing. Harmony . . . flowing from two sides that in the past 
have often been discordant: Africa's emerging entrepreneurial class and 
its civil-society activists.
    It's no secret that lefty campaigners can be cranky about business 
elites. And the suspicion is mutual. Worldwide. Civil society as a rule 
sees business as, well, a little uncivil. Business tends to see 
activists as, well, a little too active. But in Africa, at least from 
what I've just seen, this is starting to change. The energy of these 
opposing forces coming together is filling offices, boardrooms and 
bars. The reason is that both these groups--the private sector and 
civil society--see poor governance as the biggest obstacle they face. 
So they are working together on redefining the rules of the African 
game.
    Entrepreneurs know that even a good relationship with a bad 
government stymies foreign investment; civil society knows a resource-
rich country can have more rather than fewer problems, unless 
corruption is tackled.
    This joining of forces is being driven by some luminous 
personalities, few of whom are known in America; all of whom ought to 
be. Let me introduce you to a few of the catalysts:
    John Githongo, Kenya's famous whistleblower, has had to leave his 
country in a hurry a couple of times; he was hired by his government to 
clean things up and then did his job too well. He's now started a group 
called Inuka, teaming up the urban poor with business leaders, creating 
inter-ethnic community alliances to fight poverty and keep watch on 
dodgy local governments. He is the kind of leader who gives many 
Kenyans hope for the future, despite the shakiness of their coalition 
government.
    Sharing a table with Githongo and me one night in Nairobi was DJ 
Rowbow, a Mike Tyson doppelganger. His station, Ghetto Radio, was a 
voice of reason when the volcano of ethnic tension was exploding in 
Kenya in 2008. While some were encouraging the people of Kibera, one of 
the largest slums in Africa, to go on the rampage, this scary-looking 
man decoded the disinformation and played peacemaker/interlocutor. On 
the station's playlist is Bob Marley and a kind of fizzy homespun 
reggae music that's part the Clash, part Marvin Gaye. The only 
untruthful thing he said all evening was that he liked U2. For my part, 
I might have overplayed the Jay-Z and Beyonce card. ``They are friends 
of mine,'' I explained to him, eh, a lot.
    Now this might be what you expect me to say, but I'm telling you, 
it was a musician in Senegal who best exemplified the new rules. 
Youssou N'Dour--maybe the greatest singer on earth--owns a newspaper 
and is in the middle of a complicated deal to buy a TV station. You 
sense his strategy and his steel. He is creating the soundtrack for 
change, and he knows just how to use his voice. (I tried to imagine 
what it would be like if I owned The New York Times as well as, say, 
NBC. Someday, someday . . .).
    In Maputo, Mozambique, I met with Activa, a women's group that, 
among other things, helps entrepreneurs get seed capital. Private and 
public sectors mixed easily here, under the leadership of Luisa Diogo, 
the country's former prime minister, who is now the matriarch in this 
mesmerizing stretch of eastern Africa. Famous for her Star Wars hairdo 
and political nous, she has the lioness energy of an Ellen Johnson 
Sirleaf, a Ngozi Okonjo-Iweala or a Graca Machel.
    When I met with Ms. Diogo and her group, the less famous but 
equally voluble women in the room complained about excessive interest 
rates on their microfinance loans and the lack of what they called 
``regional economic integration.'' For them, infrastructure remains the 
big (if unsexy) issue. ``Roads, we need roads,'' one entrepreneur said 
by way of a solution to most of the obstacles in her path. Today, she 
added, ``we women, we are the roads.'' I had never thought of it that 
way but because women do most of the farming, they're the ones who 
carry produce to market, collect the water and bring the sick to the 
clinics.
    The true star of the trip was a human hurricane: Mo Ibrahim, a 
Sudanese entrepreneur who made a fortune in mobile phones.
    I fantasized about being the boy wonder to his Batman, but as we 
toured the continent together I quickly realized I was Alfred, Batman's 
butler. Everywhere we went, I was elbowed out of the way by young and 
old who wanted to get close to the rock star reformer and his 
beautiful, frighteningly smart daughter, Hadeel, who runs Mo's 
foundation and is a chip off the old block (in an Alexander McQueen 
dress). Mo's speeches are standing-room-only because even when he is 
sitting down, he's a standing-up kind of person. In a packed hall in 
the University of Ghana, he was a prizefighter, removing his tie and 
jacket like a cape, punching young minds into the future.
    His brainchild, the Ibrahim Prize, is a very generous endowment for 
African leaders who serve their people well and then--and this is 
crucial--leave office when they are supposed to. Mo has diagnosed a 
condition he calls ``third-termitis,'' where presidents, fearing an 
impoverished superannuation, feather their nests on the way out the 
door. So Mo has prescribed a soft landing for great leaders. Not 
getting the prize is as big a story as getting it. (He doesn't stop at 
individuals. The Ibrahim Index ranks countries by quality of 
governance.)
    Mo smokes a pipe and refers to everyone as ``guys''--as in, 
``Listen, guys, if these problems are of our own making, the solutions 
will have to be, too.'' Or, in my direction, ``Guys, if you haven't 
noticed . . . you are not African.'' Oh, yeah. And: ``Guys, you 
Americans are lazy investors. There's so much growth here but you want 
to float in the shallow water of the Dow Jones or Nasdaq.''
    Mr. Ibrahim is as searing about corruption north of the Equator as 
he is about corruption south of it, and the corruption that crosses 
over . . . illicit capital flight, unfair mining contracts, the aid 
bureaucracy.
    So I was listening. Good for me. But did I actually learn anything?
    Over long days and nights, I asked Africans about the course of 
international activism. Should we just pack it up and go home, I asked? 
There were a few nods. But many more noes. Because most Africans we met 
seemed to feel the pressing need for new kinds of partnerships, not 
just among governments, but among citizens, businesses, the rest of us. 
I sense the end of the usual donor-recipient relationship.
    Aid, it's clear, is still part of the picture. It's crucial, if you 
have HIV and are fighting for your life, or if you are a mother 
wondering why you can't protect your child against killers with 
unpronounceable names or if you are a farmer who knows that new seed 
varietals will mean you have produce that you can take to market in 
drought or flood. But not the old, dumb, only-game-in-town aid--smart 
aid that aims to put itself out of business in a generation or two. 
``Make aid history'' is the objective. It always was. Because when we 
end aid, it'll mean that extreme poverty is history. But until that 
glorious day, smart aid can be a reforming tool, demanding 
accountability and transparency, rewarding measurable results, 
reinforcing the rule of law, but never imagining for a second that it's 
a substitute for trade, investment or self-determination.
    I for one want to live to see Mo Ibrahim's throw-down prediction 
about Ghana come true. ``Yes, guys,'' he said, ``Ghana needs support in 
the coming years, but in the not-too-distant future it can be giving 
aid, not receiving it; and you, Mr. Bono, can just go there on your 
holidays.''
    I'm booking that ticket.
    In South Africa, with Madiba, the great Nelson Mandela--the person 
who, along with Desmond Tutu and the Edge, I consider to be my boss--I 
raised the question of regional integration through the African 
Development Bank, and the need for real investment in infrastructure . 
. . all the buzzwords. As Madiba smiled, I made a note to try not to 
talk about this stuff down at the pub--or in front of the band.
    ``And you, are you not going to the World Cup?'' the great man 
chided me, changing the subject, having seen this wide-eyed zealotry 
before. ``You are getting old and you are going to miss a great coming-
out party for Africa.'' The man who felt free before he was is still 
the greatest example of what real leadership can accomplish against the 
odds.
    My family and I headed home . . . just in time, I was getting 
carried away. I was going native, aroused by the thought of railroads 
and cement mixers, of a different kind of World Cup fever, of opposing 
players joining the same team, a new formation, new tactics. For those 
of us in the fan club, I came away amazed (as I always am) by the 
diversity of the continent . . . but with a deep sense that the people 
of Africa are writing up some new rules for the game.

    Senator Leahy. But one of the things that really struck me, 
he was talking with women in Mozambique. That's the first place 
we used the Leahy War Victims Fund.
    He quotes a woman who said, ``Roads. We need roads. 
Today,'' she added, ``we women, we are the roads carrying 
things.'' And I hear this over and over again. Don't ship us 
huge containers of food and agricultural products from the 
United States. Help us build some simple roads. If you raise 
produce on a farm but to sell it, the market is 12 miles away, 
15 miles away, but it's going to take you 3 days to get it 
there, then it doesn't do you any good to raise it. You can't 
sell it. If you have a simple road, that 15 miles, you can get 
there in an hour's time.

                             JUSTICE REFORM

    One last thing or last two things I'd like to talk about. 
One is justice reform. We spend tens of millions of dollars, 
maybe hundreds of millions of dollars to reform dysfunctional 
justice systems around the world. You can't have a democracy, a 
real democracy without a functioning justice system. Honest 
prosecutors, honest and independent judges.
    Look at Central America and we see places where people get 
away with murder literally or where judges are bribed or 
intimidated. Haiti is another example. There's never been the 
political will at the top.
    Is that an area where you will watch and evaluate because 
we'll spend the money if you think it's going to accomplish 
something, but I've been so disappointed seeing how little has 
been accomplished.
    Dr. Shah. Yes, sir. We will watch that. I think you're 
right to point that out and I would just highlight that it is 
both a combination of programmatic activity, training and 
supporting judges and prosecutors. There are some efforts. I 
was just part of the rehearsal concept drill in Afghanistan 
where there was a really substantive conversation about what it 
would actually take to support the informal justice system and 
the transition to more formality in that system, as well. We're 
trying some unique things in our program there.
    But I think you're absolutely right and it often is 
understated that the political will to create space for that to 
be effective is a precondition to success at scale.
    Senator Leahy. Well, I remember a group came here from one 
country to talk to me and they said, we want to look at your 
justice system and we talked about that. They asked, is it true 
that in the United States people actually sue the government on 
occasion? I said, yes, it happens often, and they said, and is 
it true that sometimes the government loses? I said, yes. They 
said, and so you then replace the judge? And then when I 
explained that, no, we don't, they finally began to understand 
what an independent judiciary is, and we have so many people in 
this country willing to take the time to go to these countries 
and work with them and help them, but too often they get lip 
service while they're there and then the bribes continue or the 
replacement of a judge who rules against the government or so 
forth.

                             CLIMATE CHANGE

    The administration plans to spend about $1.4 billion on 
climate change programs in fiscal year 2011, $646 million is 
through USAID and the State Department, part of it's to protect 
forests. Of course, the Amazon is the largest and the most 
threatened from large hydro projects and agribusiness and 
logging and mining, a lot of it illegal.
    How much are you planning to spend for forest protection 
programs in Brazil or in the other Andean American countries?

             FOREST PROTECTION ACTIVITIES IN SOUTH AMERICA

    Dr. Shah. In Brazil, USAID plans to spend 100 percent of 
the $14 million in Biodiversity and Sustainable Landscapes 
funds for forest protection programs in fiscal year 2010.
    The USAID Regional Program's Initiative for Conservation in 
the Andean Amazon will spend $7 million this year on forest 
protection in Colombia, Ecuador, Peru and Bolivia.
    USAID plans to spend the following amounts for forest 
protection programs in other South American countries in fiscal 
year 2010: Bolivia: $2.5 million in Biodiversity funds; 
Colombia: $3 million in Biodiversity and Sustainable Landscapes 
funds; Ecuador: $3.1 million in Biodiversity funds; Paraguay: 
$1 million in Biodiversity funds; and Peru: $7.5 million in 
Biodiversity and Sustainable Landscapes funds.
    In summary, USAID plans to spend the following amounts for 
forest protection programs: $14 million in Brazil, $7 million 
on the Regional Program, and $17.1 million in other South 
American countries.
    Total planned expenditures on forest protection programs is 
$38.1 million in fiscal year 2010.
    I'd also add that in the context of this, we're also 
exploring certain private sector partnerships to see if we can 
partner with private foundations and other institutions that 
have an interest in this area and might partner with us in some 
of these initiatives in Indonesia and other parts of the world.
    Senator Leahy. Well, of course, at the same time the State 
Department and others are going to have to bring some pressure 
on some of the governments to actually do the things necessary.
    The Millennium Challenge Corporation requires governments 
to commit to do certain things if they want our aid, like 
reducing corruption or increasing their own budgets for 
healthcare and education.
    Do you think USAID should be doing the same thing? In other 
words, a quid pro quo, or is that naive to think that you can 
do that in some areas?
    Dr. Shah. I think, in general, the efforts to have long-
term effective sustainable development that's broad enough that 
it reaches a large percentage of a population in country does 
require some significant degree of country ownership. MCC, of 
course, encapsulates that in a very specific set of indicators 
that then gives them a go/no go against a very large program in 
countries.
    I think the approach we're taking, especially in the Food 
Security Initiative, is a little bit more specific. If a 
country is meeting its obligations to increase its domestic 
spending in agriculture, and they are signing up to bringing 
together all of the stakeholders and private sector partners 
against a country plan, then we will stand with them and help 
them build the capacity to be successful over the long run.
    So it's a different, I think, interpretation of the 
concept, but the underlying concept that country ``skin in the 
game'' and country ownership is a precondition to long-term 
success I think was probably a shared one.
    Senator Leahy. Thank you very much. I'll put the rest of my 
questions in the record.
    I'll yield to Senator Bond.
    Senator Bond. Thank you very much, Mr. Chairman, and Dr. 
Shah, I apologize to you both for arriving so late. I had a 
visit from a high White House official talking about a rather 
pressing issue that went on and one and on.
    Senator Leahy. Aren't they all?
    Senator Bond. Well, yeah, and I--but to me, this is 
extremely important and I'm delighted to welcome Dr. Shah today 
because we believe on--I know the chair and I agree that your 
leadership is critically important at this time.
    USAID may not get all the glory on TV but when you get out 
and help the world's poorest people with global issues, clean 
water, child mortality, HIV, malaria, it's integral to, I 
think, a broader national policy, smart power, which Secretary 
Clinton has advocated so strongly and I believe in, and I know, 
having traveled around the globe extensively, I've seen where 
USAID can be a tremendous force for winning the hearts and 
minds of the people in other countries and dealing with those 
problems that are a concern to us as good neighbors or people 
in my case Christians should do.
    But a key to expanding that service is getting enough 
Foreign Service officers in USAID. We want to do that. We need 
to see USAID build a core capacity and lessen its over-reliance 
on contractors, to increase accountability and effectiveness.
    Now, as you know, biotechnology is an important component 
of smart power. Not only does it contribute to food security 
and better nutrition now, but it's absolutely essential if 
we're going to feed a global population of 9 billion people. We 
cannot get there without the most modern farming techniques and 
biotechnology.
    Dr. Shah, I know you've been a longstanding supporter of 
plant biotechnology. I want to--I can spend until early 
afternoon talking about that, but obviously I would not.

                                 ENERGY

    I need to turn to another subject that's of high priority. 
A couple weeks ago I visited India to discuss energy and a 
number of other matters. Energy, of course, is important in 
India as it is in the United States and they are overwhelmingly 
dependent upon coal to fuel their growth, to supply the energy 
to bring 1 billion population with tremendous poverty up to 
basic living standards and given the abundance and 
affordability of coal on their country, as ours, we have to 
make it cleaner, more efficient, and I was very impressed about 
an initiative USAID has undertaken in India.
    Over the course of the USAID-India Greenhouse Gas Pollution 
Prevention or GGPP Project, it has cumulatively avoided 
CO2 emissions from USAID-supported coal activities 
nearly a 100 million tons in the last 10 years. However, I was 
very concerned when U.S. and Indian officials told me that 
those efforts are no longer possible under constraints 
contained in a 2010 funding bill.
    The constraints direct that no funds shall be utilized for 
any nuclear, coal, or other fossil fuel technology or 
production and without that, India's going to go back to 
burning coal without the reduction in emissions. They have made 
progress and I'd be very interested in hearing your thoughts on 
this and hope that we can work together with the chairman and 
the ranking member to find an appropriate solution that will 
allow us to resume making CO2 emission reductions 
and making coal more energy efficient and cleaner for the 
people of India.
    Where do you stand on that?
    Dr. Shah. Well, thank you for mentioning that, Senator, and 
for highlighting some of the efforts that have been undertaken 
there.
    The low emission growth strategies for countries and 
especially mid-level economies is an important part of our 
overall Climate Change Program and will be a larger component 
of what we do going forward. We, of course, have, as part of 
the Climate Change Initiative, a broader approach but that's an 
important piece.
    I'd have to look more specifically at the 2010 funding 
constraints that preclude us from being able to work----
    Senator Bond. Would you look at that and get 
recommendations because I heard a very, very strong objection 
from both sides, both Indian and the people working for us in 
that country about the benefit that that project that was just 
cut off had provided. So if you would get back to me and 
obviously to the subcommittee, but I would like to see a copy 
of whatever you transmit to the chair and ranking member.
    [The information follows:]

 2010 Funding Constraints for the USAID/India Greenhouse Gas Pollution 
                           Prevention Project

    To comply with fiscal year 2010 guidance from Congress, 
USAID is unable to use climate change funds to continue 
supporting activities under the Greenhouse Gas Pollution 
Prevention Project. USAID is reviewing whether other funds can 
be identified outside of the funds appropriated for Global 
Climate Change clean energy program to support the project 
which is designed to introduce cleaner coal technologies and 
better operating and maintenance equipment and practices to 
make coal-fired electricity plants more energy efficient and 
cleaner. The project also reduces CO2 emissions with 
respect to a business-as-usual situation where no interventions 
are made.
    To support the goals of the October 2009 Memorandum of 
Understanding to Enhance Cooperation on Energy Security, Energy 
Efficiency, Clean Energy and Climate Change between the United 
States and India, USAID is in the process of designing a new 
clean energy program to help India promote end-use energy 
efficiency and deploy renewable energy technologies that will 
reduce the need to build as many CO2 emitting coal-
fired powerplants. The new program will support India's efforts 
to transition to an economy that produces lower volumes of 
greenhouse gases while meeting their poverty reduction goals.

    Senator Bond. Let me jump back into my favorite area, 
biotechnology. You're familiar with the Donald Danforth Plant 
Science Center and Roger Beachy. They've been improving crop 
yields even though Roger's decamped to Washington and Cassava, 
for example, is a root crop that's primary food for 750 million 
people. It's a poor nutritional content, susceptible to many 
pathogens, particularly in Asia. One-third is lost every year 
to viral diseases and the Danforth Center has been the lead on 
two major projects to address nutritional content, have been 
focusing on increasing Casava's zinc, iron, protein, vitamin A 
and E content, lowering the level of naturally occurring 
cyanide which we would think would want to be reduced, and 
reducing spoilage, and it's also done research to increase 
folic acids and minerals in sweet potato and to develop more 
protein, enhance sorghum and peanuts, and they have research 
partners in Africa.
    Now, a lot of people normally talk about biotech and you 
can see a lot of people yawn, but this to me is key to feeding 
people, hungry people in the world, and I think projects like 
this will be critical in applying the most significant business 
thinking.
    I urge you to continue supporting plant biotech research in 
Global Hungry and Security Initiative, particularly in places 
like Africa and Southeast Asia. I'd like to hear your comments 
on USAID's priorities in the area of plant biotechnology 
development.
    Dr. Shah. Thank you, Senator. I'll start by just 
acknowledging your leadership on this issue. I've had the 
chance to work with both the Danforth Center and Roger Beachy 
over the years and appreciate the unique leadership that those 
institutions and he brings.
    I think there's been a false distinction in choice set up 
between overall sustainability and core productive agriculture 
productivity and I think we have an opportunity to be 
significant advocates for using the broad range of 
technological solutions against those core constraints that are 
holding back productive agriculture in much of the world and 
disproportionately in some of the poorest parts of the world 
where rain-fed production is the predominant form of production 
and where small holder producers suffer from hunger and 
starvation when they don't have enough productivity.
    We've identified and gone through a process of identifying 
a set of core traits and core crops in which we want to work. 
As you would acknowledge, cassava is, of course, the second 
highest source of calories in Africa and is a very important 
crop and on that list and traits, like improved 
biofortification, improved drought tolerance, improved use 
characteristics, like lower cyanide content, in cassava are all 
priorities in that----
    Senator Bond. Sounds good to me.
    Dr. Shah [continuing]. Context.
    We're right now in the process of trying to ascertain what 
that means for our existing CRSP programs that fund U.S. land 
grant universities to work on a range of crops, peanuts, 
soybeans, sorghum, et cetera, and trying to take those CRSP 
programs and move them forward in a way that is more aligned 
against the set of priorities that have been identified by crop 
and by constraint and that unlock the broad set of tools and 
technologies that could be used to create advances.
    And I'd say the final piece is that we will remain 
committed to working with countries on regulatory systems and 
in country testing and training. What we have found, of course, 
is in areas like drought-tolerance maize, when a country, like 
Uganda, builds a testing facility on their own agriculture 
research station and invests in training their own scientists, 
that seems to unlock the political energy to put in place a 
regulatory system that allows their people to have access to 
those technologies. So we think that's an important part of 
this, as well.
    Senator Bond. Well, thank you very much, Dr. Shah. Mr. 
Chairman, if you'd indulge me one more minute, talking about 
the regulatory matter is very important.
    I talked with the Secretary of Agriculture in India and 
other leaders. I talked to Secretary Bahsu and he understands 
the importance of transgenic seeds. Right now Aubergine, what 
you call eggplant, is the high controversy. I understand from a 
very good friend of ours that right now the Aubergine crop 
requires a 120 pesticide spray and the farmers won't even eat 
the darn vegetable because there's so much pesticide on it.
    I've talked with the Ambassador and others in India and 
they say, oh, well, we need to listen to our people who are 
concerned about it. They're listening to NGOs who make their 
living off of raising fear about GMOs and as a result they are 
missing the opportunity to increase the harvest of a very 
important vegetable that can be produced with far less chemical 
pesticides.
    Mr. Chairman, again, please accept my sincere thanks and my 
apologies for this.
    Senator Leahy. We've worked together on so many of these 
things and this will be your last hearing with the Director of 
USAID.
    Senator Bond. That's why I wanted to get several bites, but 
I'm going to be--I hope he will contact me. We look forward to 
working with him because I----
    Senator Leahy. As I said before you came in, I'm delighted 
that he's there because there have been problems at USAID that 
you and I have discussed before.
    Senator Bond. Oh, yes, I remember those.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Leahy. But I think Dr. Shah's the right person at 
the right time and the right place and there are many, many 
very dedicated men and women at USAID and I think they breathed 
a sigh of relief when he arrived, and with that, we'll stand in 
recess.
    Thank you. Thank you, Dr. Shah.
    Dr. Shah. Thank you.
    [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 Patrick J. Leahy

                      TRANSITION INITIATIVE MODEL

    Question. Although we often hear about how slow and bureaucratic 
most of USAID is, we hear the opposite about the Office of Transition 
Initiatives. That office focuses on conflict-prone countries, and 
countries making the transition from crisis to stability. The office is 
relatively small but agile, with flexibility to target resources 
quickly at the local level. Why can't more of USAID function like that 
office?
    Answer. I am pleased that our Office of Transition Initiatives 
(OTI) is recognized for effectively and efficiently managing in very 
difficult and fluid situations. OTI is charged with responding to a 
particular set of countries that are conflict prone, are in conflict, 
or those in transition to stability.
    OTI's business model involves flexible planning and management 
structures, including short-term strategies geared to short-term 
objectives along with systems for procurement, staff and monitoring/
reporting developed for those purposes. These structures rely on 
constant innovation, rapid procurement systems, and intensive, hands-on 
management tailored to dynamic, fluid environments enabling OTI to 
react quickly to evolving situations on the ground. OTI fosters a 
culture of entrepreneurism while placing more authority in the field. 
Staff are encouraged to seek alternate solutions in program design and 
execution, and to support small-scale, rapid, and tactical investments 
in community or national projects that address a country's transition 
or momentum toward recovery from conflict.
    The Agency does take OTI's experience into account in its larger 
programming response. These include a greater focus on the use local 
implementing organizations, more rapid program monitoring and feedback 
systems, and flexible planning where authorities are in the field, 
which permits rapid programming responses. Additionally, having 
Indefinite Quantity Contracts (IQCs) in place as rapid response 
mechanisms will continue to be an important component to the Agency's 
ability to respond more efficiently.
    As part of our Agency's reform process, I am closely looking at 
OTI's business model and lessons learned and will identify other 
elements which can be replicated to the rest of the Agency. I 
acknowledge that not all tools are applicable to longer-term 
development, but in a changing world, we must consider and integrate 
all the innovative approaches we can.

                          USAID EFFECTIVENESS

    Question. You have said that restoring USAID's effectiveness is 
your top priority and that this will require USAID to make significant 
changes in the way that it is organized and operates. What do you mean 
by ``restoring USAID's effectiveness'', what do you see as most needing 
change, and what changes are you making?
    Answer. I have recently outlined a new approach to high-impact 
development which will lie at the center of restoring USAID's 
effectiveness. In four core areas we're already putting this approach 
into practice.
    First, USAID is contributing to the U.S. commitment to the 
Millennium Development Goals (MDGs), not simply by delivering services 
to those in need, but through building sustainable systems that will 
transform healthcare, education, food security and other MDG areas.
    Second, we are strengthening our ability to invest in country-owned 
models of inclusive growth and development success. USAID will promote 
these outcomes in a focused set of areas in countries that are 
reasonably well-governed, economically stable, globally connected and 
market oriented. We will undertake these enhanced efforts in a whole-
of-government context using complementary assets like trade, private 
investment and diplomacy to increase the effectiveness of our 
development cooperation and increase the chances of success.
    Third, we are identifying new ways of leveraging science and 
technology to develop and deliver tools and innovations which we 
believe can be transformational. I am proud of USAID's past support for 
the Green Revolution, and this is the time to recalibrate our current 
science and research portfolio around today's set of grand challenges 
such as climate change, global health, and food security.
    Finally, we need to continue to bring USAID's expertise to bear on 
some of the most daunting national security challenges we face as a 
Nation including stabilizing countries like Afghanistan.
    Restoring USAID's effectiveness requires more than these new focus 
areas. We have to transform the way we do work. USAID's development 
experts will provide increased support to encourage innovation and 
entrepreneurship. USAID staff will be encouraged to take risks in a 
smart and calculated way to achieve greater returns in international 
development. To support this, we're putting in place a range of policy 
reforms and new business models that will help our operations improve 
and enable our people to be development entrepreneurs.
    USAID is establishing a new policy bureau and resource planning 
capacity that will be instrumental in managing coherent development 
approaches and strengthening accountability for our work. In addition, 
USAID is planning to roll out a meaningful set of procurement reforms. 
These will involve doing a better job of building local capacity and 
investing in local institutions where we work overseas. This summer we 
will launch a set of talent management and human resource reforms that 
are key to our future as an effective Agency. This will include doing a 
better job of leveraging the skills and knowledge of USAID's Foreign 
Service National staff. Finally, in the fall we will launch a major 
monitoring, evaluation and transparency initiative.
    I am convinced if we can re-establish a rigorous program evaluation 
function and be the most transparent development agency in the world, 
that the American people will increase their support of our work. I 
believe this package of reforms will restore USAID's effectiveness and 
provide the means to restore the Agency to a world-class institution.

                               PSD-7/QDDR

    Question. What impact do you anticipate the White House's 
``Presidential Study Directive on U.S. Development Policy'' and the 
Secretary of State's ``Quadrennial Diplomacy and Development Review'' 
will have on USAID?
    Answer. I anticipate that both exercises, which are closely 
coordinated, will have a very positive impact on USAID and U.S. global 
development efforts. Both the PSD and QDDR are premised on the strong 
belief in the importance of international development and of 
strengthening USAID. I am gratified by the support of President Obama 
and Secretary Clinton in this regard.

                           GLOBAL ENGAGEMENT

    Question. One of the Administration's new initiatives includes a 
request for $100 million for a new ``Global Engagement'' account. My 
understanding is this account would provide economic growth, academic 
exchanges and partnerships, and other education-related assistance to 
partner countries with mainly Muslim populations, and would likely be 
administered by USAID.
    These are all things that USAID and the State Department already 
do. Why does a new account need to be created instead of providing 
support for these activities through existing mechanisms? Which 
countries are likely to receive this assistance?
    Answer. President Obama's vision of Global Engagement is that the 
U.S. Government engages the world in a spirit of respect and 
partnership to achieve shared goals. One of his priorities in this area 
is to broaden the relationship between the United States and Muslim-
majority countries around the world. The Department of State and USAID 
requested a separate line item to catalyze the start-up and initial 
tracking of funding for a cohesive set of activities to address the 
objectives of Global Engagement.
    This is not a request for a separate account, but rather a separate 
line item within the Economic Support Fund account. This will allow us 
to track the activities that are started-up with these funds, and these 
new activities will complement and strengthen ongoing foreign 
assistance efforts. In future years, we may incorporate these 
activities into ongoing program and country budgets.
    The countries to receive this assistance are still to be 
determined, and but will be regionally-diverse with significant Muslim 
populations.

                        AFGHANISTAN AND PAKISTAN

    Question. USAID is dramatically increasing its staffing and 
programs in Afghanistan and Pakistan. Both countries suffer from severe 
security threats, weak governments and corruption, and inadequate 
office and housing space for USAID personnel.
    We hear frequently how difficult it is for USAID staff to get out 
into the field to monitor programs. We also learned in Iraq that 
spending lots of money quickly in places like Afghanistan or the tribal 
areas of Pakistan is a recipe for waste, fraud and abuse.
    How are you dealing with these challenges, and are you trying to 
spend too much money too fast--as was the case in Iraq and Afghanistan 
by the previous administration?
    Answer. The issue of adequate oversight for and thoughtful 
expenditure of resources in an environment such as Afghanistan and 
Pakistan is a challenge that we face on a daily basis. In order to 
tackle that challenge and protect U.S. taxpayer funds, we are engaging 
in several concurrent efforts in both countries. I will mention them 
briefly here and provide additional detail below. Specifically, we are 
increasing our staffing (both program and oversight) in both countries; 
we are developing alternative mechanisms of oversight in those 
situations where direct access to activities is not yet possible; and, 
through the provision of technical assistance, we are increasing the 
capacity of local institutions to provide services to the population 
and make assistance efforts more sustainable.
    While USAID is increasing our staffing and programs in both 
Afghanistan and Pakistan, you are correct that it has been historically 
difficult for us to get out and monitor projects. As you are aware, we 
are working intensively with Missions in both countries to adequately 
plan, recruit, and retain qualified staff to be present both in the 
capital cities and throughout the countryside. These new personnel have 
a wide variety of backgrounds including financial management, 
agriculture, governance, and engineering and add much needed 
development assistance to these countries, while at the same time 
providing the essential oversight element to our activities.
    From a security perspective, Afghanistan and Pakistan will provide 
us with significant challenges for the foreseeable future insofar as 
access to activities is concerned. In light of that fact, we have 
developed alternative mechanisms of providing oversight to our 
activities in situations when direct access is not possible. In 
Afghanistan we are developing ``movement agreements'' with our military 
colleagues in order to enable our civilian PRT representatives to 
regularly access project sites within their respective provinces 
instead of being confined to their PRT. Furthermore, in both countries, 
we rely extensively on our locally engaged staff, Quality Assessment/
Quality Control (QA/QC) contractors--the staff of which is largely 
locally employed, and implementing partners to provide oversight 
functions when direct access by United States direct hire personnel is 
not possible.
    As you are aware, we are working to change our business model to 
include increased implementation through local entities (government and 
private sector) that have been or will be assessed and certified to 
receive USAID funding directly. A large portion of requested funds for 
the fiscal year 2010 supplemental and fiscal year 2011 will be 
dedicated to that effort. This will serve to increase the capacity of 
national, provincial and local entities while making assistance more 
sustainable.
    Finally, I would also like to note that we work collaboratively 
with our Inspector General communtiy in both countries, who provide the 
needed audit and investigative review of activities to provide 
assistance in a well directed manner.

           INTERNATIONAL COOPERATIVE ADMINISTRATIVE SERVICES

    Question. A recent survey about the State Departments ICASS 
process, which consolidates agency administrative operations overseas 
like motor pools, warehousing, supplies, maintenance and other 
functions, was a logical idea to improve efficiency and save money. But 
the survey suggests that for USAID, ICASS has caused more problems than 
it has solved.
    The overwhelming majority of USAID overseas employees reported that 
their work had become harder and more costly. There were complaints 
about access to vehicles, billing mistakes, time consuming reporting, 
and an increase in tension between USAID and the State Department. Have 
you looked at this? Is it time to review the consolidation and 
determine whether it really makes sense for USAID?
    Answer. The Agency is working in collaboration with the Department 
of State to jointly review our experience with administrative 
consolidation through the Quadrennial Diplomacy and Development Review 
(QDDR). The QDDR leadership formed a Joint USAID/State Task Force to 
survey and examine the impact of consolidation overseas recognizing 
that problems exist. The review is focusing on the 21 posts where USAID 
missions overseas are collocated on secure Embassy compounds and where 
functions have been substantially consolidated for 3 years.
    During the course of the QDDR Task Force review, the American 
Foreign Service Association (AFSA) sent out its own survey worldwide to 
all USAID employees of all employment categories, and the results show 
that the implementation of consolidation caused significant confusion 
and highlighted several support services and procedures that have been 
problematic at many Embassies.
    State Department and USAID management are addressing these problem 
areas in a systematic manner. Areas for improvement are being 
identified, and the Task Force will recommend measures to strengthen 
joint State/USAID support platforms within ICASS. Both the Department 
and USAID have affirmed that the goal of this review is to achieve 
optimum consolidation of overseas administrative services provided to 
State and USAID under the ICASS platform based on the principles of the 
most cost efficient, and effective service provision to support our 
respective diplomatic and development missions.
    The Task Force has reviewed existing consolidation data and annual 
ICASS Satisfaction Surveys, and detailed questionnaires were completed 
by both the USAID missions and the ICASS Service Providers (Embassy 
Management Officers). Existing cost data in Washington also is being 
reviewed, and USAID missions are providing updated cost information on 
post-consolidation operations.
    The interim data collected by the Task Force shows that 
improvements can be made that will result in a higher quality and more 
effective shared platform overseas that serves State and USAID as well 
as the many other U.S. Government ICASS customer agencies. The keys to 
making those improvements and to success in optimizing consolidation 
appear to be: (1) recognition that consolidation has been successful 
for most services at most posts, but that problems must be actively 
addressed; (2) improved accountability by the service provider; (3) 
communication on best practices, roles, and responsibilities; (4) 
incorporating additional flexibilities for USAID when necessary to meet 
the Agency's mission-critical needs; and (5) addressing individual 
posts directly where broad service issues may exist.
    The Task Force study will help USAID and State reach agreement on 
shared principles for consolidating services in the future, and the 
QDDR operational plan will also seek to identify opportunities to 
enhance and optimize consolidation efforts at all posts.

                            NGO TRANSPARENCY

    Question. Budget transparency is a big issue these days, in an 
effort to reduce opportunities for corruption. USAID gives a lot of 
money to NGOs--nongovernmental organizations--for projects to promote 
transparency in other countries, but what about the NGOs themselves--do 
they have to make public their own project budgets so people can see 
what they are doing with the money they receive from USAID?
    Answer. U.S. NGOs (PVOS) that receive grants from USAID are awarded 
funding based on budgets submitted with their applications. Project 
budgets are part of grant agreements which, in turn, are public 
documents. Expenditures are reported quarterly and are subject to 
audit. As 501(c)(3) organizations, each must file an annual Form 990 
with the Internal Revenue Service. PVOs registered with USAID must 
submit audited financial statements annually to the USAID Registrar. 
These include all funding received from USAID whether as grants or 
contracts.
    Question. If I want to know what NGO ``x'' is doing with money from 
USAID for a ``rule of law'' project, or a ``budget transparency'' 
project, or some other project, in the Philippines, or Mozambique, or 
El Salvador, can I go to a website and find a breakdown for how the 
funds are being spent--does USAID require this kind of transparency 
from its own grantees? If not, should it?
    Answer. At present there is no website where you can find out 
expenditure information for NGOs that have received funding from USAID. 
USAID does have an internal capacity for accrual reporting but this 
information only provides amounts obligated and gross expenditures, not 
budget details. For USAID to collect and enter detailed expenditure 
information for each contract and grant for website use would require a 
major investment in software development as well as staff time.
    Project budgets are part of grant agreements which, in turn, are 
public documents. The Agreement Officers' Technical Representatives 
responsible for the awards receive quarterly financial reports and can 
request more detailed information on expenditures. All grants and 
contracts are subject to audit.
    While we would agree that to model the transparency they are 
encouraging through USAID-funded projects, PVOs and others should make 
their financial reporting under our grants available to the public. 
USAID's present grant agreements do not require this. This requirement 
could be added to all grant agreements but limitations exist on 
financial reporting requirements per U.S. Federal regulations (22 CFR 
226.52). Should a member of the public request this information from 
USAID, it could be made available.
    Working with the Department of State, USAID is committed to 
increasing the ease of access by the public to information about 
foreign assistance expenditures and performance. While there are limits 
to the level of detail for individual grants and contracts that we will 
be able to provide to the public, we are aggressively working to 
improve our ability to respond to in-country information needs about 
USAID activities, and to provide more real-time, complete, and 
understandable information to the general public.
    In line with USAID's demonstrated commitment to transparency, the 
agency supports NGOs adhering to similarly high standards in making 
expenditures public. A coalition of diverse international humanitarian 
and development NGOs is currently working to identify common principles 
of development effectiveness, including budget transparency. USAID is 
very supportive of this process and the desired outcome for greater 
downstream transparency \1\. NGOs are in the best position to establish 
common reporting standards amongst their peers and we are supportive of 
their efforts in this area.
---------------------------------------------------------------------------
    \1\ While USAID supports greater transparency, there is recognition 
that the release of information may at times undermine other U.S. 
government priorities and interests. For this reason, the agency 
supports principled exceptions in line with FOIA guidelines.
---------------------------------------------------------------------------
               GLOBAL HUNGER AND FOOD SECURITY INITIATIVE

    Question. The President's ``Food for the Future'' initiative calls 
for $3.5 billion over 3 years to combat hunger through agricultural 
development and improved nutrition. The Administration has requested $1 
billion for agriculture programs and $200 million for nutrition 
programs in fiscal year 2011 to support this initiative.
    I have seen many anti-hunger initiatives over the years, all well 
intentioned, and most have had positive impacts. But hunger remains a 
global problem. Assuming you get the funds you have requested and 
everything goes as planned, can you predict what portion of the world's 
hungry people will no longer be hungry after this 3 year initiative?
    Answer. As there is no fully agreed-upon number of the ``world's 
hungry,'' even though the figure of 1 billion is commonly used, it is 
difficult to predict what portion of this population will no longer be 
hungry after the 3-year Feed the Future initiative. However, an 
international investment of $22 billion pledged by L'Aquila partners, 
which includes the Feed the Future initiative, invested in country-led, 
evidence-based strategies, will help to raise incomes, improve 
nutrition, and enhance food security in several ways:
  --Based on detailed cost-benefit analysis, we estimate that as a 
        baseline level, donor programs can directly increase the 
        incomes of at least 40 million people in developing countries, 
        including 28 million people who are currently living on incomes 
        of less than $2 per day and 13 million people living in extreme 
        poverty on less than $1.25 per day.
  --We can amplify these returns through significant increases in 
        investments in agricultural research, as well as its adaptation 
        and dissemination. Through ``game changing'' innovations like 
        improved crop varieties, the direct benefits of other 
        assistance programs can be extended to many millions of other 
        beneficiaries.
  --These gains will be further amplified by the complementary 
        investments by host country governments, and by private sector 
        investors, both domestic and international. Our investments in 
        infrastructure, extension services, and other areas, 
        complemented by government public investments, will make 
        private investments more attractive, adding to the impact of 
        the program.
  --Based on our preliminary analysis, we can reach 25 million children 
        in developing countries with a package of nutrition 
        interventions that has been demonstrated to reduce child 
        mortality, improve nutrition outcomes, and protect human 
        capital. These interventions are projected to reduce the number 
        of stunted children by nearly 10 million, and the number of 
        underweight children by more than 4 million.
    Specifically, with regard to the U.S. Government's Feed the Future 
initiative, our development and diplomatic support for game-changing 
policy reforms that expand opportunities for widespread private 
entrepreneurship--including full participation by women--can also 
accelerate a process of sustainable country-driven development that 
extends the benefits of this initiative to millions more consumers who 
cannot be reached directly with project-based assistance as food 
supplies increase, prices decline and markets become more stable.
    Question. Is the President's plan part of something bigger, 
coordinated with what other donors and governments in developing 
countries are doing?
    Answer. Yes, the Global Hunger and Food Security Initiative, also 
known as ``Feed the Future,'' is part of the larger L'Aquila Global 
Food Security Initiative (AFSI). G8 and other donor countries have 
pledged $22 billion to increase investments in agriculture and 
nutrition to improve the lives of the world's hungry. The USG has 
pledged $3.5 billion as its part of AFSI. That pledge is contingent on 
the availability of appropriated funds.
    The Feed the Future initiative has been developed to accelerate 
progress toward Millennium Development Goal #1 (MDG 1) in countries 
committed to achieving that goal of halving hunger and poverty by 2015. 
It is designed to improve the coordination and integration of USG 
resources capable of contributing to global food security now and in 
the future. Five principles will guide our common approach: Invest in 
country-owned food security plans; strengthen strategic coordination 
among key stakeholders; ensure a comprehensive approach; leverage the 
benefits of multilateral institutions; and deliver on sustained and 
accountable commitments.
    Further evidence of a larger effort is the Administration's 
commitment to multilateral engagement through the Global Agriculture 
and Food Security Program (GAFSP), a new trust fund administered by the 
World Bank. The United States contributed approximately $67 million to 
the Fund in 2010. Other donors who have made commitments to the fund to 
date include Canada ($230 million), Spain ($95 million), South Korea 
($50 million) and the Gates Foundation ($30 million).

                         DEVELOPMENT ASSISTANCE

    Question. You request $2.9 billion for Development Assistance, a 
$460 million increase from last year. The bulk of the increase is for 
agriculture and food security, climate change, and education programs.
    More money is one thing, and I strongly support these programs as I 
believe many others do. But using money effectively is another, 
especially in a time of budget constraints. What steps do you plan to 
take to get better results from the money you already have, before 
spending more?
    Answer. To achieve better results from existing resources, the Feed 
the Future (FTF) and the Global Climate Change (GCC) initiatives as 
well as USAID Basic and Higher Education programs will include robust 
monitoring and evaluation systems, as well as results frameworks that 
are underpinned by rigorous analyses. An expanded set of performance 
indicators will include the collection of baseline data for both 
initiatives that will focus on impact. The United States is working 
with other donors to ensure that we do not duplicate efforts. Within 
the U.S. Government, initiatives are being coordinated to leverage the 
technical expertise of various agencies providing more efficient 
delivery of assistance. Internally, USAID is aligning efforts to 
achieve far greater integration across its global, regional and 
country-focused programs.
    Furthermore, focusing on achieving better results includes not only 
an emphasis on monitoring and program evaluations, but also on 
communications, knowledge management and training for staff and USAID 
counterparts.

                             CLIMATE CHANGE

    Question. How much are you requesting globally for programs to 
protect biodiversity (the Congress provided $205 million in fiscal year 
2010)?
    Answer. The Administration requested $113.9 million in fiscal year 
2011 for biodiversity conservation. This request was developed through 
a bottom-up request process. USAID Missions faced a constrained budget 
scenario, requiring difficult choices in their budget requests for 
fiscal year 2011.

                           MICROCREDIT LOANS

    Question. The New York Times ran an article recently about lending 
institutions that charge exorbitant interest rates on micro-loans and 
reap big profits (see attached article, ``Banks Making Big Profits from 
Tiny Loans''). One bank in Mexico is cited as charging poor 
entrepreneurs an incredible 125 percent annual interest rate on its 
micro-loans. Your fiscal year 2011 budget request includes $230 million 
for micro-enterprise and micro-finance programs, which have 
consistently received support from this subcommittee.
    What is the average interest rate of loans charged by micro-lending 
institutions that receive USAID support, and how does this rate compare 
to the global average for micro-loans? How frequently does USAID 
receive information on changes in the rates of interest these 
institutions charge?
    Answer. USAID does not currently collect information on the 
interest rates of its partners around the world; rather, it focuses its 
efforts on promoting development of sustainable microfinance sectors 
across the developing world, which requires that microfinance 
institutions be allowed to set competitive interest rates. USAID 
guidelines for its microfinance programs require responsible practices 
regarding interest rates and other lending policies.
    Recognizing that the need to ensure sustainability of micro-finance 
services in economic environments where investment risks are high often 
requires MFIs to establish relatively high interest rates, USAID 
provides a range of support to MFIs designed to improve efficiency, 
reduce risk and, thereby, to reduce the interest rates required for 
sustainable cost recovery. For example, USAID helps MFIs overcome the 
challenges of attracting a broad base of funding, introducing 
alternative delivery mechanisms to reduce operational costs, and 
identifying more efficient ways to reach remote, poor populations while 
keeping operating costs low. USAID also employs guarantee programs 
through the Development Credit Authority (DCA) to increase access to 
low-cost commercial funds for MFIs.
    USAID recognizes that competition works best when interest rates 
are presented to borrowers in clear and transparent terms, so that they 
have the ability to rationally choose among lenders. For this reason, 
USAID will be providing support this fiscal year to the ``Smart 
Campaign'' led by the Center for Financial Inclusion at ACCION 
International. As part of this initial pilot, the Campaign will work 
with MFIs around the world to ensure they provide transparent, 
respectful and prudent financial services, including transparency 
surrounding their interest rate. Therefore, while USAID does not 
currently collect information on the interest rates of its partners 
around the world, support for the Smart Campaign movement--as well as 
the anticipated push from donors, practitioners, and investors in the 
years to come--will help USAID continue to promote development of the 
microfinance sector, including competitive interest rates.
    According to USAID policy, before signing an agreement to provide 
assistance to any microfinance institution, the Mission must determine 
that the institution has full and effective latitude to set interest 
rates and fees at full cost-covering levels; the institution's 
management is prepared to charge interest rates and fees on loans that 
are high enough to cover the program's full long-run costs; the 
institution can attain full financial sustainability on the MFI's 
financial service activities within no more than 7 years of the initial 
provision of USAID assistance; and the institution will use USAID 
assistance to expand the availability of financial services to 
microentrepreneurs and other poor people.
    Also, the MFI must have a plan to reach full financial 
sustainability, including a timetable and benchmarks to track its 
progress. USAID's annual Microenterprise Results Report (MRR) tracks 
the financial sustainability of the MFIs supported by our funds. In 
fiscal year 2008, 75 percent of institutions were reported as fully 
sustainable.

               [From The New York Times, April 13, 2010]

                Banks Making Big Profits From Tiny Loans
                         (By Neil MacFarquhar)

    In recent years, the idea of giving small loans to poor people 
became the darling of the development world, hailed as the long elusive 
formula to propel even the most destitute into better lives.
    Actors like Natalie Portman and Michael Douglas lent their boldface 
names to the cause. Muhammad Yunus, the economist who pioneered the 
practice by lending small amounts to basket weavers in Bangladesh, won 
a Nobel Peace Prize for it in 2006. The idea even got its very own 
United Nations year in 2005.
    But the phenomenon has grown so popular that some of its biggest 
proponents are now wringing their hands over the direction it has 
taken. Drawn by the prospect of hefty profits from even the smallest of 
loans, a raft of banks and financial institutions now dominate the 
field, with some charging interest rates of 100 percent or more.
    ``We created microcredit to fight the loan sharks; we didn't create 
microcredit to encourage new loan sharks,'' Mr. Yunus recently said at 
a gathering of financial officials at the United Nations. ``Microcredit 
should be seen as an opportunity to help people get out of poverty in a 
business way, but not as an opportunity to make money out of poor 
people.''
    The fracas over preserving the field's saintly aura centers on the 
question of how much interest and profit is acceptable, and what 
constitutes exploitation. The noisy interest rate fight has even 
attracted Congressional scrutiny, with the House Financial Services 
Committee holding hearings this year focused in part on whether some 
microcredit institutions are scamming the poor.
    Rates vary widely across the globe, but the ones that draw the most 
concern tend to occur in countries like Nigeria and Mexico, where the 
demand for small loans from a large population cannot be met by 
existing lenders.
    Unlike virtually every Web page trumpeting the accomplishments of 
microcredit institutions around the world, the page for Te Creemos, a 
Mexican lender, lacks even one testimonial from a thriving customer--no 
beaming woman earning her first income by growing a soap business out 
of her kitchen, for example. Te Creemos has some of the highest 
interest rates and fees in the world of microfinance, analysts say, a 
whopping 125 percent average annual rate.
    The average in Mexico itself is around 70 percent, compared with a 
global average of about 37 percent in interest and fees, analysts say. 
Mexican microfinance institutions charge such high rates simply because 
they can get away with it, said Emmanuelle Javoy, the managing director 
of Planet Rating, an independent Paris-based firm that evaluates 
microlenders.
    ``They could do better; they could do a lot better,'' she said. 
``If the ones that are very big and have the margins don't set the 
pace, then the rest of the market follows.''
    Manuel Ramirez, director of risk and internal control at Te 
Creemos, reached by telephone in Mexico City, initially said there had 
been some unspecified ``misunderstanding'' about the numbers and asked 
for more time to clarify, but then stopped responding.
    Unwitting individuals, who can make loans of $20 or more through 
Web sites like Kiva or Microplace, may also end up participating in 
practices some consider exploitative. These Web sites admit that they 
cannot guarantee every interest rate they quote. Indeed, the real rate 
can prove to be markedly higher.
Debating Microloans' Effects
    Underlying the issue is a fierce debate over whether microloans 
actually lift people out of poverty, as their promoters so often claim. 
The recent conclusion of some researchers is that not every poor person 
is an entrepreneur waiting to be discovered, but that the loans do help 
cushion some of the worst blows of poverty.
    ``The lesson is simply that it didn't save the world,'' Dean S. 
Karlan, a professor of economics at Yale University, said about 
microlending. ``It is not the single transformative tool that 
proponents have been selling it as, but there are positive benefits.''
    Still, its earliest proponents do not want its reputation tarnished 
by new investors seeking profits on the backs of the poor, though they 
recognize that the days of just earning enough to cover costs are over.
    ``They call it `social investing,' but nobody has a definition for 
social investing, nobody is saying, for example, that you have to make 
less than 10 percent profit,'' said Chuck Waterfield, who runs 
mftransparency.org, a Web site that promotes transparency and is 
financed by big microfinance investors.
    Making pots of money from microfinance is certainly not illegal. 
CARE, the Atlanta-based humanitarian organization, was the force behind 
a microfinance institution it started in Peru in 1997. The initial 
investment was around $3.5 million, including $450,000 of taxpayer 
money. But last fall, Banco de Credito, one of Peru's largest banks, 
bought the business for $96 million, of which CARE pocketed $74 
million.
    ``Here was a sale that was good for Peru, that was good for our 
broad social mission and advertising the price of the sale wasn't the 
point of the announcement,'' Helene Gayle, CARE's president, said. Ms. 
Gayle described the new owners as committed to the same social mission 
of alleviating poverty and said CARE expected to use the money to 
extend its own reach in other countries.
    The microfinance industry, with over $60 billion in assets, has 
unquestionably outgrown its charitable roots. Elisabeth Rhyne, who runs 
the Center for Financial Inclusion, said in Congressional testimony 
this year that banks and finance firms served 60 percent of all 
clients. Nongovernmental organizations served 35 percent of the 
clients, she said, while credit unions and rural banks had 5 percent of 
the clients.
    Private capital first began entering the microfinance arena about a 
decade ago, but it was not until Compartamos, a Mexican firm that began 
life as a tiny nonprofit organization, generated $458 million through a 
public stock sale in 2007, that investors fully recognized the 
potential for a windfall, experts said.
    Although the Compartamos founders pledged to plow the money back 
into development, analysts say the high interest rates and healthy 
profits of Compartamos, the largest microfinance institution in the 
Western Hemisphere with 1.2 million active borrowers, push up interest 
rates all across Mexico.
    According to the Microfinance Information Exchange, a Web site 
known as the Mix, where more than 1,000 microfinance companies 
worldwide report their own numbers, Compartamos charges an average of 
nearly 82 percent in interest and fees. The site's global data comes 
from 2008.
    But poor borrowers are often too inexperienced and too harried to 
understand what they are being charged, experts said. In Mexico City, 
Maria Vargas has borrowed larger and larger amounts from Compartamos 
over 20 years to expand her T-shirt factory to 25 sewing machines from 
5. She is hazy about what interest rate she actually pays, though she 
considers it high.
    ``The interest rate is important, but to be honest, you can get so 
caught up in work that there is no time to go fill out paperwork in 
another place,'' she said. After several loans, now a simple phone call 
to Compartamos gets her a check the next day, she said. Occasionally, 
interest rates spur political intervention. In Nicaragua, President 
Daniel Ortega, outraged that interest rates there were hovering around 
35 percent in 2008, announced that he would back a microfinance 
institution that would charge 8 to 10 percent, using Venezuelan money.
    There were scattered episodes of setting aflame microfinance 
branches before a national ``We're not paying'' campaign erupted, which 
was widely believed to be mounted secretly by the Sandinista 
government. After the courts stopped forcing small borrowers to repay, 
making international financial institutions hesitant to work with 
Nicaragua, the campaign evaporated.
A Push for More Transparency
    The microfinance industry is pushing for greater transparency among 
its members, but says that most microlenders are honest, with experts 
putting the number of dubious institutions anywhere from less than 1 
percent to more than 10 percent. Given that competition has a pattern 
of lowering interest rates worldwide, the industry prefers that 
approach to government intervention. Part of the problem, however, is 
that all kinds of institutions making loans plaster them with the 
``microfinance'' label because of its do-good reputation.
    Damian von Stauffenberg, who founded an independent rating agency 
called Microrate, said that local conditions had to be taken into 
account, but that any firm charging 20 to 30 percent above the market 
was ``unconscionable'' and that profit rates above 30 percent should be 
considered high.
    Mr. Yunus says interest rates should be 10 to 15 percent above the 
cost of raising the money, with anything beyond a ``red zone'' of loan 
sharking. ``We need to draw a line between genuine and abuse,'' he 
said. ``You will never see the situation of poor people if you look at 
it through the glasses of profit-making.''
    Yet by that measure, 75 percent of microfinance institutions would 
fall into Mr. Yunus's ``red zone,'' according to a March analysis of 
1,008 microlenders by Adrian Gonzalez, lead researcher at the Mix. His 
study found that much of the money from interest rates was used to 
cover operating expenses, and argued that tackling costs, as opposed to 
profits, could prove the most efficient way to lower interest rates.
    Many experts label Mr. Yunus's formula overly simplistic and too 
low, a route to certain bankruptcy in countries with high operating 
expenses. Costs of doing business in Asia and the sheer size of the 
Grameen Bank he founded in Bangladesh allow for economies of scale that 
keep costs down, analysts say. ``Globally interest rates have been 
going down as a general trend,'' said Ms. Javoy of Planet Rating.
    Many companies say the highest rates reflect the costs of reaching 
the poorest, most inaccessible borrowers. It costs more to handle 10 
loans of $100 than one loan of $1,000. Some analysts fear that a 
pronounced backlash against high interest rates will prompt lenders to 
retreat from the poorest customers.
    But experts also acknowledge that banks and others who dominate the 
industry are slow to address problems.
Added Scrutiny for Lenders
    Like Mexico, Nigeria attracts scrutiny for high interest rates. One 
firm, LAPO, Lift Above Poverty Organization, has raised questions, 
particularly since it was backed by prominent investors like Deutsche 
Bank and the Calvert Foundation.
    LAPO, considered the leading microfinance institution in Nigeria, 
engages in a contentious industry practice sometimes referred to as 
``forced savings.'' Under it, the lender keeps a portion of the loan. 
Proponents argue that it helps the poor learn to save, while critics 
call it exploitation since borrowers do not get the entire amount up 
front but pay interest on the full loan.
    LAPO collected these so-called savings from its borrowers without a 
legal permit to do so, according to a Planet Rating report. ``It was 
known to everybody that they did not have the right license,'' Ms. 
Javoy said.
    Under outside pressure, LAPO announced in 2009 that it was 
decreasing its monthly interest rate, Planet Rating noted, but at the 
same time compulsory savings were quietly raised to 20 percent of the 
loan from 10 percent. So, the effective interest rate for some clients 
actually leapt to nearly 126 percent annually from 114 percent, the 
report said. The average for all LAPO clients was nearly 74 percent in 
interest and fees, the report found.
    Anita Edward says she has borrowed money three times from LAPO for 
her hair salon, Amazing Collections, in Benin City, Nigeria. The money 
comes cheaper than other microloans, and commercial banks are virtually 
impossible, she said, but she resents the fact that LAPO demanded that 
she keep $100 of her roughly $666 10-month loan in a savings account 
while she paid interest on the full amount.
    ``That is not O.K. by me,'' she said. ``It is not fair. They should 
give you the full money.''
    The loans from LAPO helped her expand from one shop to two, but 
when she started she thought she would have more money to put into the 
business.
    ``It has improved my life, but not changed it,'' said Ms. Edward, 
30.
    Godwin Ehigiamusoe, LAPO's founding executive director, defended 
his company's high interest rates, saying they reflected the high cost 
of doing business in Nigeria. For example, he said, each of the 
company's more than 200 branches needed its own generator and fuel to 
run it.
    Until recently, Microplace, which is part of eBay, was promoting 
LAPO to individual investors, even though the Web site says the lenders 
it features have interest rates between 18 and 60 percent, considerably 
less than what LAPO customers typically pay.
    As recently as February, Microplace also said that LAPO had a 
strong rating from Microrate, yet the rating agency had suspended LAPO 
the previous August, 6 months earlier. Microplace then removed the 
rating after The New York Times called to inquire why it was still 
being used and has since taken LAPO investments off the Web site.
    At Kiva, which promises on its Web site that it ``will not partner 
with an organization that charges exorbitant interest rates,'' the 
interest rate and fees for LAPO was recently advertised as 57 percent, 
the average rate from 2007. After The Times called to inquire, Kiva 
changed it to 83 percent.
    Premal Shah, Kiva's president, said it was a question of outdated 
information rather than deception. ``I would argue that the information 
is stale as opposed to misleading,'' he said. ``It could have been a 
tad better.''
    While analysts characterize such microfinance Web sites as well-
meaning, they question whether the sites sufficiently vetted the 
organizations they promoted.
    Questions had already been raised about Kiva because the Web site 
once promised that loans would go to specific borrowers identified on 
the site, but later backtracked, clarifying that the money went to 
organizations rather than individuals.
    Promotion aside, the overriding question facing the industry, 
analysts say, remains how much money investors should make from lending 
to poor people, mostly women, often at interest rates that are hidden.
    ``You can make money from the poorest people in the world--is that 
a bad thing, or is that just a business?'' asked Mr. Waterfield of 
mftransparency.org. ``At what point do we say we have gone too far?''

                                 WATER

    Question. The Administration has requested $255 million for water 
sanitation and supply projects in fiscal year 2011. USAID funds water-
related activities in various program areas such as agriculture, 
economic growth, nutrition, and health. Approximately how much will 
USAID spend on water-related activities in fiscal year 2011, across all 
programs?
    Answer. The Administration's request for water programs in fiscal 
year 2011 is $260 million. Each year, additional amounts for all water 
activities normally include portions of other programs that help to 
improve water supply, sanitation and hygiene (WSSH), water resources 
management (WRM); water productivity (WP), and water-related disaster 
risk reduction (DRR). Those additional programs may include Disaster 
Assistance for WSSH (normally $90-$100 million), natural resources 
management programs contributing to WRM, agricultural sector 
productivity contributions to WP and broader disaster response and 
preparedness contributions to water-related DRR. Based on current 
projections, the total fiscal year 2011 USAID water expenditures, once 
all attributions are included, can be expected to be between $500-$600 
million.
    Question. The fiscal year 2010 State and Foreign Operations bill 
requires the relevant USAID bureaus and offices that support cross-
cutting programs such as water to coordinate on a regular basis. In the 
case of water, how does USAID plan to better coordinate water 
activities and programs across bureaus?
    Answer. The Administration has now formed a new High-level Steering 
Group on Water that will be responsible for coordination of diplomatic 
and development activities related to water within State, USAID and the 
wider U.S. Government. As part of early actions on coordination, 
efforts are underway to better integrate water into the 
Administration's fiscal year 2012 budget request, and to identify 
water-related aspects of the Administration's new initiatives in Global 
Climate Change, Food Security and Global Health. Beyond these new 
efforts, USAID has been engaged in a vigorous ongoing coordination and 
communication process within the Agency's Water Team, which is an 
informal coordination group with membership from all USAID functional 
and regional bureaus in Washington and all USAID missions overseas who 
are engaged in water sector activities, whether in health, economic 
growth, environment, energy, gender integration, agriculture, private 
sector business and finance or in other areas where water figures in 
development programs.

                            WOMEN AND GIRLS

    Question. For years, the Congress has tried to get USAID and the 
State Department to pay more attention to the needs of women and girls 
in our foreign aid programs. It has not been easy. This Administration 
seems to be more receptive, but good intentions do not always produce 
good results. How do you plan to address this issue?
    Answer. USAID is placing renewed emphasis on addressing the needs 
of women and girls throughout our foreign aid programs. Three areas in 
particular relate to staff training, new gender analysis and planning 
requirements, and the incorporation of gender considerations into new 
Administration initiatives, all reflecting USAID's renewed commitment 
to women and girls.
    With regard to USAID's new gender analysis and planning 
requirements, the Agency adopted new regulations in November 2009 that 
require gender analysis and the inclusion of gender within all of the 
Agency's program planning, monitoring, contracting, and evaluation 
processes. In 2010, guidance on these new regulations was created to 
ensure staff is familiar with the regulations and understand how to 
comply with them. USAID is now also training program officers, 
contracts officers, and field staff in these new regulations. The new 
regulations also require USAID Missions to conduct gender analyses. In 
2010, 20 gender assessments have been completed, are in process or 
planned, as compared to three completed in 2009, two in 2009 and three 
in 2007.
    In 2009, USAID also made it mandatory that all incoming Foreign 
Service Officers (FSOs) receive gender training. To date, 264 of 
USAID's junior FSOs have been trained. USAID also conducted gender-
based violence and trafficking in persons training for field staff from 
19 countries in February 2010 and several more field-based trainings 
are scheduled. USAID is reviewing ways to improve measuring performance 
toward achieving gender equality as part of our renewed focus on 
monitoring and evaluation.
    Finally, all of the Administration's new initiatives, Global 
Health, Global Climate Change, Global Engagement, and Feed the Future, 
have explicitly incorporated gender concerns. For example, the Feed the 
Future guide published in May 2010, emphasizes gender integration into 
all proposed food security investments. Global Climate Change 
Initiative (GCC) investments are being designed to promote women's 
participation in the development of community-level strategies to 
increase community resilience to climatic risks. The Global Health 
Initiative (GHI) includes significant increases for programs that serve 
women and girls, including maternal and child health, family planning, 
nutrition and HIV/AIDS. The GHI will also support long-term, systemic 
changes to remove economic, cultural, social and legal barriers and to 
expand opportunities to increase the participation of women and girls 
in decisionmaking in the health sector.

                             JUSTICE REFORM

    Question. USAID has spent many tens of millions--probably hundreds 
of millions--of dollars in what has often been a futile effort to 
reform dysfunctional justice systems around the world. We recognize 
that justice is fundamental to democracy and stability. One need only 
look at Central America today to see what happens when people know they 
can get away with murder, or where judges can be easily bribed or 
witnesses intimidated, to see the consequences. Violent crime and 
organized crime are flourishing.
    But without the political will to reform, we end up throwing away 
good money after bad. Haiti is another example. There has never been 
the necessary political will at the top and frankly, there still isn't. 
Do you agree that in order to reform a country's justice system the 
country's own Ministry of Justice needs to be serious about reform?
    Answer. Indeed, reform of the justice system requires a commitment 
to reform by the Ministry of Justice as well as the political will to 
reform other parts of the government. The justice system is an 
important element of a functioning, transparent and accountable 
government. The Ministry of Justice, along with other ministries and 
agencies responsible for advancing the rule of law, are keys to 
success; while civil service reform is also necessary to ensure that 
government workers--including police, prosecutors, judges, and prison 
officials--are paid a living wage. If governments do not undertake this 
type of reform, thus reducing incentives for corruption, corruption 
will destroy developmental gains that might otherwise be realized.
    Even in places where democracy is in its infancy or is struggling, 
it is possible to foster momentum for change. There will be those in 
the business, academic, faith, media and even government communities 
who can be rallied to support the necessary changes in the justice 
system. In some places, it may be that facilitating this momentum is 
``Job #1'' for USG representatives and other donors interested in the 
same result.
    One of the best ways to convince leaders that reform is in their 
best interest is through the empowerment of civil society. As civil 
society becomes stronger and civic education expands, citizens begin to 
understand the services that their governments should be providing and 
they are thus more likely to hold leaders accountable for their 
actions. This is not a quick process, but rather something that must be 
pursued with local change agents over a period of many years. Civil 
society empowerment should be a lynchpin for the USG's promotion of 
democracy, good governance, and the rule of law.

                           COUNTRY OWNERSHIP

    Question. USAID is using the term ``country ownership'' more and 
more. What does this mean in practice, and how does USAID's concept of 
country ownership differ from that of the Millennium Challenge 
Corporation?
    Answer. For USAID, in practice, there have been three main aspects 
to ``country ownership'': (1) host country commitments to good 
governance and policy reform; (2) the extent to which the host country 
is a partner in the selection, orientation and design, implementation, 
and monitoring and evaluation of the assistance program; and (3) the 
extent to which the host country invests in cost sharing arrangements 
to ensure the sustainability of the program. All of these aspects are 
relevant to both USAID and the MCC approaches to the delivery of 
foreign aid and are consistent with the growing body of knowledge on 
the link between country ownership and aid effectiveness.
    The MCC defines country ownership of an MCC compact as being ``when 
a country's national government controls the prioritization process 
during compact development, is responsible for implementation, and is 
accountable to its domestic stakeholders for both decisionmaking and 
results''. Their model emphasizes country ownership from the selection 
process, through compact design and implementation, using host nation 
systems at all stages of the compact.
    For USAID, the concept of country ownership--focused on host nation 
participation in formulating and designing aid programs--has always 
been an integral part of its program planning. For example, USAID's 
programming guidelines state that country development cooperation 
strategies which aim to promote transformational development must 
``align with host country strategies coordinated with a broad cross 
section of stakeholders, including the socially and economically 
disadvantaged.'' Importantly, USAID's historic operating model 
emphasized country presence specifically to work in collaboration with 
host country leaders and national stakeholders to build country 
capacity for development reforms. Bilateral Assistance Agreements have 
been used to set forth mutually agreed upon understandings between 
USAID and the host government of the timeframe, results expected to be 
achieved, means of measuring those results, resources, 
responsibilities, and contributions of participating entities for 
achieving defined priorities, goals and objectives.
    In light of our new approach to high-impact development and 
emphasis under the PSD-7 and QDDR exercises, USAID is currently 
reviewing its policies and business model to align them more 
intrinsically with aid effectiveness principles, including that of 
country ownership. We expect reforms in the way we do business to 
result in greater use of host country development strategies, planning 
and financial management systems, and accountability to their own 
citizens for results from development investments.

                              SELECTIVITY

    Question. One of the things I like about the MCC is that it 
requires governments to commit to do certain things if they want our 
aid, like taking specific steps to reduce corruption, or increase their 
own budgets for heathcare and education. Do you think USAID should 
require governments to meet these types of benchmarks of progress in 
return for our aid?
    Answer. In accordance with its charter, the MCC uses ex-ante 
indicators of performance as the basis for selection of country 
partners--a principle known as ``selectivity.'' Given the relatively 
limited set of partner countries in which MCC operates, this 
``selectivity'' has been useful as an incentive for potential partners 
to undertake their own reforms as a step toward eligibility for MCC 
assistance. USAID also considers ``selectivity'' to be important for 
the success of its transformational development programs, but works 
with a larger, more diverse universe of partners, and with a broader 
set of criteria. Key among a number of factors for selecting USAID 
partner country investments are: need, U.S. foreign policy interest, 
and the country's own development priorities and commitment to reforms. 
As such, USAID's approach to ``selectivity'' primarily informs 
decisions about how to engage, rather than whether to engage.
    As you know, the Obama administration is close to putting in place 
an overarching development policy. The policy is intended to focus 
strategically our goals and aspirations so that we can most effectively 
achieve them. We're already putting a new approach to high-impact 
development into practice in a number of core areas, including 
strengthening our ability to invest in country-owned models of 
inclusive growth and development success. We have learned from recent 
country examples, the experience of MCC and from efforts like the 
Spence Commission of the value of focusing on a set of areas critical 
to inclusive growth in countries that are reasonably well-governed, 
economically stable, globally connected and market-oriented. We 
anticipate working with MCC, State and others to identify such 
countries where the foundations for progress are in place. In this new, 
more focused approach, USAID may consider the use of additional policy 
benchmarks to help more reliably identify a recipient country's 
location along the development continuum. We may also learn from MCC's 
approaches to monitoring and evaluation and ex-ante cost benefit 
analyses to help achieve greater transformational impact.

                             GLOBAL HEALTH

    Question. One of the four main components of the Administration's 
Global Health Initiative is ``doing more of what works and less of what 
doesn't.'' One would hope that would be a requirement of every Federal 
program. Since the GHI began in 2009, has USAID ended any programs or 
activities that were not working, that has resulted in significant 
savings? Have any new initiatives achieved better results?
    Answer. Learning and accountability are critical to the success of 
the GHI, and we are increasing the rigor and transparency of monitoring 
and evaluation, with an emphasis on using data to help us identify 
critical problems and improvements throughout our programs. This lens 
will apply for both new and innovative approaches, as well as for those 
existing programs that may benefit from adjustments and improvements.
    We place strong emphasis on close tracking and evaluation because 
that ongoing process, in close dialogue with the country teams, will 
permit us to learn, respond and ultimately have tailored programs that 
are ``smarter,'' with greater country ownership, more partners, and 
more efficient and effective approaches than we would have designed in 
a ``blueprint'' manner. In GHI, as across this Administration's 
development agenda, the findings from evaluations will be shared with 
decisionmakers in ways that are intended to create the best information 
for effective programming in the future.
    As part of our efforts to ensure country-led programs, we expect 
and welcome programs that are designed at the country level to best 
respond to the specific disease and health systems priorities in that 
country. Since the GHI's inception, we have not ended programs or 
activities, but as we continue to work on the country-level roll-out, 
we will work with our country colleagues to hone and sharpen our 
existing efforts while learning from new and innovative approaches.

                       MATERNAL AND CHILD HEALTH

    Question. The European medical journal The Lancet recently reported 
that global maternal mortality deaths have decreased by 40 percent 
since 1980. But there are still about 350,000 cases of preventable 
maternal deaths annually around the globe.
    There are some who want to cut foreign aid. This is one area where 
those who care about women, children, and families can point to life-
saving results. The Administration has requested $700 million for 
maternal and child health programs in fiscal year 2011, a significant 
increase of approximately $225 million over the fiscal year 2010 level. 
What do you plan to do, and what do you expect to accomplish, with this 
additional money?
    Answer. The additional funding will allow USAID to:
    Advance coverage of life-saving interventions in up to 31 countries 
\2\ that are a priority for USAID MCH programs.
---------------------------------------------------------------------------
    \2\ India, Cambodia, Indonesia, the Philippines, Bangladesh, Nepal, 
Pakistan, Tajikistan, Afghanistan, Azerbaijan, Yemen, Ethiopia, Sudan 
(southern), Uganda, Rwanda, Mali, Nigeria, Senegal, Liberia, Ghana, 
Benin, Democratic Republic of the Congo, Zambia, Mozambique, Malawi, 
Tanzania, Madagascar, Kenya, Haiti, Guatemala and Bolivia.
---------------------------------------------------------------------------
    The evidence suggests that focusing on the major causes of 
maternal, newborn and child mortality with simple interventions could 
prevent about two-thirds of child deaths, up to two-thirds of newborn 
deaths, and a large fraction of maternal deaths globally.
  --Some longstanding proven interventions need reinvigoration. For 
        example, USAID will focus on increasing oral rehydration 
        therapy (ORT) for diarrhea, including the use of zinc as an 
        adjunct to ORT, in those countries where ORT use rates are 
        stagnant or falling.
  --Other interventions need to be introduced or are ready to be scaled 
        up, such as:
    --Active management of the third stage of labor (AMTSL) to prevent 
            postpartum hemorrhage (PPH): USAID will expand full 
            provision of this intervention (that can reduce PPH by up 
            to 60 percent) to 75 percent of facility-level births in 
            Mali, Mozambique, Malawi, Nigeria, Kenya, Mali, Tanzania 
            and Bolivia. (In a multi-country survey of 10 countries in 
            2008, full application of AMTSL ranged from <1-31 
            percent.);
    --Management of severe preeclampsia/eclampsia with magnesium 
            sulfate in facilities.--USAID will apply this life-saving 
            intervention in up to 10 countries (with possible expansion 
            to community level in 2 or 3 countries);
    --Essential newborn care and resuscitation.--These life-saving 
            interventions will be introduced and a phased-in scale up 
            will be launched in up to 13 countries, with substantial 
            potential for public-private partnership with a 
            manufacturer of innovative low-cost equipment for newborn 
            resuscitation in several;
    --Integrated community case management (CCM) of malaria, diarrhea 
            and pneumonia.--USAID will introduce or scale up case 
            management in Cambodia, Nepal, Benin, the Democratic 
            Republic of the Congo, Ethiopia, Ghana, Malawi, Mozambique, 
            Rwanda, Senegal and Zambia. In five of these countries, 
            USAID will introduce rapid diagnostic tests for malaria to 
            increase appropriate treatment of children with fever; and
    --Community-led total sanitation and sanitation marketing.--USAID 
            will support these new behavior-focused approaches to 
            improving sanitation in health programs in up to five 
            countries.
    Increase coverage of care by frontline healthcare providers, 
especially midwives and community health workers, to provide the 
evidence-based interventions essential for mortality reduction.
    Gaps in human resources for health, in terms of numbers, skill mix 
and distribution, continue to pose a challenge for effective service 
delivery, particularly in underserved rural areas. While the human 
resource deficit is serious, there has been progress, particularly in 
Asia, but the problem in Africa is more challenging. USAID will:
  --Disseminate evidence on the effectiveness of alternative financing 
        approaches, such as community-based health insurance and 
        waivers of fees to increase the use of skilled birth 
        attendants. USAID's contribution to this dynamic field will 
        influence key policy decisions by governments for use of their 
        own and donor resources to reduce the financial barriers for 
        families to access skilled care;
  --Accelerate the training and supervision of community health workers 
        (CHWs), who can be extremely effective in providing preventive 
        and curative care that saves lives. USAID expects to apply the 
        newly developed and pilot-tested CHW Functionality Tool in 
        approximately five countries to catalyze policies and focus 
        effort on the weakest components of national CHW programs; and
  --Expand support to midwifery pre-service education programs in five 
        to seven sub-Saharan African countries, initiating or 
        strengthening accreditation systems, to unlock the unending 
        cycle of need for in-service training to develop basic skills.
    Invest in health systems that advance rational policies and improve 
individual and organizational capacity for sustainable development.
    USAID will selectively strengthen components of the health system 
critical to delivering the high-impact interventions needed to reduce 
child and maternal mortality. USAID will:
  --Expand support for the effective implementation of systems of 
        procurement, storage and delivery of key pharmaceuticals and 
        other essential commodities;
  --Rapidly expand quality improvement systems, including standards-
        based management and collaborative approaches in 15 countries--
        including Afghanistan, Pakistan, Malawi and Tanzania--as well 
        as other innovative approaches to increase incentives to 
        improve service delivery such as pay-for-performance; and
  --Expand activities to address the long-term sustainability of 
        national health systems by strengthening the capacity of 
        national and sub-national ministries of health to ensure 
        services that are effective, non-discriminatory and responsive 
        to local needs.
    Target the most vulnerable as maternal and child health programs 
are expanded, many of whom give birth and are treated for illness in 
the community setting.
    USAID will expand delivery of evidence-based interventions into 
communities where the poor and vulnerable face death outside of formal 
healthcare facilities. This will include enhancing the advocacy, 
policy, planning and budgeting capacity to support a basic package of 
integrated services that emphasizes the MCH needs of vulnerable women 
and children, while also--in line with Global Health Initiative (GHI) 
core principles--fostering women's leadership, empowerment and access 
to these critical services. USAID will:
  --In six countries, introduce misoprostol, an effective uterotonic, 
        to prevent post-partum hemorrhage in home deliveries where 
        AMTSL cannot be provided by a skilled birth attendant;
  --Promote the management of newborn infections with antibiotics by 
        trained CHWs in seven countries; and
  --Disseminate and promote examples of effective CHW programs--such as 
        in Nepal where maternal mortality declined by 48 percent within 
        10 years and where antibiotic treatment for pneumonia by CHWs 
        has contributed to dramatic reductions in child mortality--to 
        policymakers and programmers in other countries and supporting 
        development of national programs adapted from effective models.
    Expand monitoring and evaluation to ensure that results of USG 
investments are documented in a transparent way and lessons learned 
incorporated into our programs.
    Investing in regular, as well as intermittent, independent 
monitoring and evaluation of MCH programs is essential to improve 
health outcomes by tailoring approaches based upon evidence. USAID will 
enhance health information systems to:
  --Improve tracking of availability and stock-outs of drugs and other 
        critical commodities;
  --Improve routine and periodic systems for measuring progress in all 
        priority countries;
  --Better assess the quality of care being delivered; and
  --Monitor access to services and health outcomes, as an input to 
        formulate sound policies and as a means to ensure 
        accountability for results to donors.
    Expanded and accelerated monitoring will take place in all priority 
countries so that key indicators for tracking progress will be 
available for all 31 emphasis countries on an annual basis.
    Continue to support major international research and the 
advancement of new technologies and approaches to enhance MCH program 
effectiveness.
    To improve programs in the long run and to tackle some of the key 
problems facing health programs in diverse environments, it is 
essential to find and test innovations. New technologies and approaches 
are needed. Importantly, many of the most vulnerable choose to avoid or 
are geographically and culturally distanced from modern medicine. USAID 
will expand its work in finding innovations--both technological and 
human--to reach these vulnerable people. Additional funding will allow 
for a new generation of approaches to be investigated and further 
developed, such as:
  --Cell phone and other communication technology (for communicating 
        health messages, enhancing client care at a distance, improving 
        the functioning of the referral system for obstetric and 
        newborn emergencies, etc.);
  --New diagnostics and preventive approaches, such as a simple test to 
        detect risk for impending eclampsia and other risk 
        identification for pregnant women and newborns;
  --Improved therapeutic approaches, such as starting preeclampsia and 
        eclampsia treatment in the community with a loading dose of 
        magnesium sulfate before transfer to a hospital for definitive 
        care; and
  --Effective behavior change strategies for client behaviors, such as 
        stopping harmful infant nutrition practices, and for provider 
        behaviors, such as eliminating demeaning and abusive behavior 
        toward childbearing women.
    In all countries, regions, and global programs--consistent with the 
principles of the GHI--USAID will expand coordination and strategic 
integration of MCH programs with malaria, HIV/AIDS, and family planning 
programs, as well as strengthen partnerships with multilateral 
organizations, and other international and in-country partners. USAID 
will strengthen existing and build new public-private partnerships for 
the development and introduction of innovative health technologies and 
approaches, such as oxytocin Uniject to prevent postpartum hemorrhage, 
new methods of delivering chlorine-based drinking water disinfectants, 
and promotion of hand washing among caregivers as an important measure 
to prevent severe newborn infection.
    Ultimately, the impact of this work, along with investments prior 
to and after fiscal year 2011, will be measured in terms of mortality 
and lives saved by many countries in 2015 to document progress or 
attainment of Millennium Development Goals 4 and 5. In the interim, 
USAID will provide evidence from all countries of improved policies to 
promote evidence-based practices, better quality of care, increased 
uptake of services by the poor, and increased use of life-saving 
interventions.

                                  H1N1

    Question. At the beginning of the H1N1 outbreak there was 
difficulty in obtaining antivirals in desired quantities. Does USAID 
currently have any plans to acquire antivirals to help combat H1N1 
globally and in places like West Africa where the virus is currently 
spreading? If no, please explain. If yes, how will USAID determine the 
proper amount of antivirals to acquire? Does USAID have long-term plans 
to acquire antivirals to distribute to affected countries to combat 
future pandemics?
    Answer. At present, USAID does not have any plans to stockpile 
antivirals. Because the World Health Organization (WHO) was able to 
independently establish a stockpile of more than 10 million doses of 
Tamiflu, it was determined that this stockpile was adequate for the 
current global needs and no USAID funds were required for this purpose. 
We are in constant contact with WHO and we monitor the situation very 
closely to determine if any USAID assistance in the stockpiling of 
antivirals is required. If assistance is required, USAID would support 
WHO's ability to procure the needed antivirals. USAID stands ready to 
assist WHO in drug distribution, should that be necessary. We have 
played a major role in the area of vaccine and ancillary commodity 
distribution and can expand that role to antivirals if needed. USAID 
will continue to work with the other USG agencies and international 
organizations to determine the appropriate measures needed and how to 
best meet those needs.
    With respect to sub-Saharan Africa, USAID is working very closely 
with countries and international organizations to support improved 
surveillance of influenza through the provision of laboratory equipment 
and supplies, as well as supporting vaccination programs for health 
workers and pregnant women. By the end of May 2010, USAID will have 
supported the delivery of more than 40 million doses of the H1N1 
vaccine and ancillary materials to more than 60 countries worldwide. 
Additionally, USAID is supporting a global laboratory network to 
monitor the impact of the H1N1 virus as it spreads around the world, 
with a special focus in upgrading the surveillance and laboratory 
capacities of 26 countries in West and Central Africa and Central and 
South America--where such capacities were previously non-existent. 
While we are watching the situation in Africa very closely, sub-Saharan 
Africa only constitutes about 3 percent of the total number of H1N1 
cases worldwide and less than 1 percent of the deaths attributed to 
H1N1. Strengthening the ability of countries to accurately detect H1N1 
cases and monitor any changes in the trends of these cases is critical 
to rapid and effective response. USAID is constantly monitoring the 
trends in all regions and is prepared to mobilize support should the 
situation change significantly.
                                 ______
                                 
               Question Submitted by Senator Tim Johnson

                  WHEAT STEM RESISTANCE WHEAT VARIETY

    Question. This appropriations cycle I have requested additional 
funds for USDA to develop a Ug99 wheat stem resistance wheat variety. 
Can you tell me how agriculture programs at USAID complement the 
research conducted at USDA? Ug99 would be devastating to my South 
Dakota producers, as well as producers throughout the world. What is 
your plan for developing a Ug99 wheat resistant variety?
    Answer. USAID has been the lead international development agency in 
responding to the wheat stem rust alarm first raised by Dr. Norman 
Borlaug some 5 years ago. After almost 50 years of durable resistance 
to this most dreaded disease of wheat, Ug99 appeared as a virulent new 
strain that threatened food security in Africa, the Middle East and 
South Asia, but ultimately could greatly harm America's farmers as 
well. The disease has not yet reached an epidemic stage, but with the 
right environmental conditions in South Asia, a food security disaster 
could result, including setting the stage for a global pandemic of Ug99 
that would probably reach the U.S. wheat belt.
    To prevent this from happening, USAID has provided some $20 million 
in the last 5 years for wheat research by the Consultative Group on 
International Agricultural Research (CGIAR), in partnership with U.S. 
universities and USDA's Agricultural Research Service, to identify and 
rapidly deploy resistance genes. USAID also supported expanded efforts 
by USDA's Cereal Disease Laboratory in St. Paul to identify new sources 
of resistance to the pathogen. USAID and USDA also supported screening 
trials in disease hot-spots in East Africa, where global wheat 
varieties--including those from the United States and Canada--were 
screened for both susceptibility and resistance. It is estimated that 
over 80 percent of the world's wheat varieties are susceptible, a fact 
that underscores the severity of the threat. In addition, the Bill and 
Melinda Gates Foundation established the Borlaug Global Rust 
Initiative, which links to both USAID and USDA, to respond to this 
threat and put in place expanded ability to monitor and control wheat 
rust pathogens in the future.
    CGIAR wheat breeding efforts have made excellent progress. Using 
the latest molecular techniques and genetic information from 
international partnerships, new varieties of wheat that are resistant 
to the new strain have been developed, forming a first line of defense 
against a potential epidemic. Over the last 2 years, USAID has deployed 
over $5 million in specially authorized ``Famine Funds'' to rapidly 
multiply and scale up production of resistant wheat seed in 
Afghanistan, Pakistan, Nepal, Egypt and Ethiopia. We also have a 
partnership with India, which brings its own considerable resources to 
the effort. In addition, we also are working with global partners as 
part of a disease-surveillance effort to monitor movement of the 
disease, which has now moved as far as east Iran.
    It is important to recognize that, while we have taken vital steps 
and made good progress, more work is needed to build back the ``durable 
resistance'' that Dr. Borlaug achieved in the Rockefeller Foundation's 
wheat program in Mexico in the 1950s--the forerunner of CGIAR. USAID 
has worked closely with USDA's Agricultural Research Service, U.S. 
universities and researchers in Australia, India and elsewhere around 
the world to ensure that resistant varieties are developed and food 
security protected. All of the resistant materials and genetic 
information about the disease and resistance to it are freely available 
from the various partners, especially the CGIAR, which has an explicit 
focus on sharing its products and information. These new sources of 
resistance are being used in USDA and U.S. university wheat breeding 
programs to develop varieties adapted to U.S. growing environments. 
Taken together, our overseas work aimed at protecting food security in 
the developing world is also helping to ensure that U.S. farmers 
continue to have access to high-yielding, resistant wheat varieties 
with the qualities our markets demand. Similarly, U.S. scientific 
capabilities are being shared through research collaborations around 
the globe, helping to strengthen food security.
                                 ______
                                 
           Questions Submitted by Senator Frank R. Lautenberg

                          HAITI RECONSTRUCTION

    Question. In the reconstruction process in Haiti, what is being 
done to enable local, community-based organizations to access funds?
    Answer. USAID recognizes that its work in the longer-term recovery 
and reconstruction phase must be both transparent and participatory. 
Therefore, USAID is developing a procurement strategy that will support 
transformational change in Haiti.
    This procurement strategy will support the humanitarian response as 
well as the recovery and reconstruction phases in a way that is both 
country-led and builds local capacity. The following outlines 
procedures that are designed to ensure transparency, efficiency and 
broader outreach to attract new partners.
    For example, our New Partners Initiative: The USAID procurement 
strategy encourages and provides for greater use of local NGOs, and 
U.S. small, minority and women-owned businesses, and seeks to tap the 
expertise and energy of the Haitian-American community. Assessments of 
local NGOs are conducted and technical assistance provided to build 
their organizational capacity to receive direct awards. Direct 
engagement with the U.S. Haitian-American community helps the Diaspora 
understand the U.S. foreign assistance strategy and how to do business 
with USAID. Set-asides for U.S. small, minority and women-owned 
businesses will be maximized and public-private partnerships will be 
promoted.
    Question. How are you making certain that the large majority of the 
recovery and reconstruction funds for Haiti are going to services, 
supplies or other direct benefits and not organizational administrative 
costs?
    Answer. USAID shares Congress' intent to get as many resources as 
possible into the hands of Haitian organizations and communities to 
achieve the goal of ``building Haiti back better.'' We are committed to 
working with a variety of organizations in the recovery and 
reconstruction effort, including local Haitian, Diaspora, American and 
international organizations.
    Working successfully toward results in difficult environments takes 
deliberate planning and considerate amounts of coordination at all 
levels. For this, development programs require some level of 
administrative support that provides for an effective and efficient 
infrastructure, designed to allow the program to reach its end goals. 
Salaries for local Haitian employees, for example may be considered an 
administrative cost. Yet, these costs also directly benefit the economy 
of Haiti.
    USAID is working diligently to maximize resources going directly to 
benefit the people and country of Haiti through careful negotiation of 
our grants and contracts and continuous oversight during 
implementation. USAID makes every effort to minimize fixed 
administrative costs when negotiating new mechanisms so that USG 
resources reach the maximum number of beneficiaries possible. This 
includes requesting mandatory cost share contributions and leveraging 
resources with the private sector to offset administrative costs.
    Question. What role will environmental issues such as reforestation 
play in the long-term recovery plan for Haiti?
    Answer. Root causes of environmental disaster in Haiti include 
acute poverty, rapid population growth and unplanned urbanization. In 
the short term, it is critical to convert hillsides to tree-based 
perennial agriculture to improve soil conservation. Lessons learned 
from decades of reforestation programs demonstrate that, if a tree has 
value, a farmer is likely to maintain and manage it; if not, it will 
likely disappear. Therefore, strengthening tree crop value chains is an 
approach with proven ability to restore degraded landscapes.
    USAID/Haiti's Watershed Initiative for National Natural 
Environmental Resources (WINNER) Project, an agricultural and watershed 
management program, applies best practices such as this. WINNER is 
already active in the Cul-de-Sac watershed where Port-au-Prince is 
located, as well as the Cabaret, Mirebalais, Archaie and Gonaives 
regions of Haiti. WINNER was underway prior to the January 12, 2010 
Haiti earthquake and was modified to immediately address post-
earthquake needs. The United States will continue to invest a total of 
$126 million in the project over the next 5 years. WINNER is 
strengthening the value chains for tree crops and focusing on tree 
crops with high value (such as mango) as these are effective incentive 
to hillside farmers to plant and manage perennial crops.
    In addition to tree crops, the USG strategy in Haiti also includes 
plans to promote cleaner and more efficient cooking technologies, such 
as liquid petroleum gas (LPG), to decrease charcoal consumption and 
reduce the rate of deforestation and environmental degradation. After 
completing a rigorous assessment of the potential market for improved 
cooking technologies, the USG will implement a program that will 
address market barriers such as high upfront costs or lack of awareness 
and achieve large-scale reduction of charcoal consumption over a 5-year 
period. Beneficiaries are likely to include households, food vendors 
and energy-intensive businesses such as laundries and bakeries.
    Finally, a Programmatic Environmental Assessment will be conducted 
for proposed earthquake reconstruction activities, which will pay close 
attention to addressing these issues across the mission's portfolio of 
projects.

                        EMERGENCY CONTRACEPTION

    Question. Do you plan to add emergency contraception to the list of 
contraceptive commodities available for purchase by USAID missions and 
to make funds available to do so?
    Answer. USAID-supplied oral contraceptive pills are among the FDA-
approved formulation that can be used for emergency contraception (EC). 
While USAID does not currently procure a dedicated EC product as part 
of its contraceptive commodity procurement program, USAID supplies 
information about the use of EC in a variety of its technical and 
training materials and supports sharing information about this 
contraceptive option with family planning clients in countries where EC 
is an approved contraceptive method. USAID has supported biomedical 
research on the mechanism of action, use, and effectiveness of EC, and 
in some countries supported operations research programs to determine 
EC use and need.
    While there is no current plan to add EC commodities to the list of 
commodities available for purchase by USAID, the Agency is currently 
reviewing its procurement policy and guidelines with respect to 
programming EC.
                                 ______
                                 
              Questions Submitted by Senator Arlen Specter

                     INFLUENZA PANDEMIC PREPARATION

    Question. I have been a consistent proponent of aggressive 
preparedness efforts at the Federal, State and local levels to reduce 
the threat of an influenza pandemic, and have worked with a series of 
HHS Secretaries--Secretaries Thompson, Leavitt and now Sebelius--to 
ensure that Congress provides the adequate resources to defend our 
country against a pandemic. As pandemics are global by definition, I 
know that USAID plays a major role in our preparation efforts.
    With regard to H1N1, in late February 2010, the World Health 
Organization elected to hold at the phase 6 pandemic alert level rather 
than move to a post-peak phase. As I understand it, the WHO experts 
based this decision on evidence of new spread of the H1N1 virus in West 
Africa, and the possibility of a second wave of illnesses as the 
Southern Hemisphere enters its winter months. I am also still keeping 
my eye on H5N1, which has already claimed lives in Egypt and Vietnam 
this year and has been reported in several other countries.
    I know USAID has taken steps to acquire pre-pandemic vaccines to 
combat these viruses on a global scale, and I applaud this effort. 
However, I am also aware of the important role of antivirals, such as 
Tamiflu, in combating influenza pandemics. It is my understanding that 
last year, USAID considered acquiring antivirals for the purpose of 
distribution to countries affected by the pandemic, but did not move 
forward because of a sense that H1N1 had waned.

             LONG-TERM PLANS TO COMBAT SPREAD OF PANDEMICS

    What actions is USAID taking to counter the spread of H1N1 in 
regions seeing growing incidence of H1N1, such as West Africa? Does 
USAID currently have any plans to acquire antivirals to help combat 
this spread? If not, why?
    Answer. In fiscal year 2009, USAID programmed a total of $85 
million to address the H1N1 virus, of which $50 million was 
appropriated as an emergency supplemental and $35 million was 
reprogrammed from USAID's regular fiscal year 2009 Avian and Pandemic 
Influenza (API) appropriation. USAID worked closely with other USG 
departments to coordinate efforts. USAID funds were allocated to 
activities that were best suited for USAID's comparative advantage and 
in support of activities that were being conducted by other government 
entities. These funds have been used to support three lines of H1N1 
related work:
  --Deployment of the H1N1 vaccine and related ancillary materials 
        (syringes, needles, etc.). By the end of the May 2010 we expect 
        to have supported the delivery of more than 40 million doses of 
        the H1N1 vaccine and ancillary materials to more than 60 
        countries;
  --Support for a global laboratory network to monitor the impact of 
        the H1N1 virus as it spread around the world, with a special 
        focus on upgrading the surveillance and laboratory capacities 
        of 26 countries in West and Central Africa and Central and 
        South America--where such capacities were previously non-
        existent; and
  --Support for community-based, non-pharmaceutical interventions in 28 
        countries through a coalition of the International Federation 
        of Red Cross Societies, UN partners and NGOs.
    Because the World Health Organization (WHO) was able to 
independently establish a stockpile of more than 10 million doses of 
Tamiflu, no USAID funds were used for this purpose. We are in constant 
contact with WHO and monitor the situation very closely to determine if 
any USAID assistance in the stockpiling of antivirals is required. At 
present no USAID funds are required for this purpose.
    Question. How does the acquisition and stockpiling of antivirals 
fit into USAID's long-term plans to combat future pandemics?
    Answer. At present, USAID does not have any plans to stockpile 
antivirals in fiscal year 2011. The WHO stockpile is determined to be 
sufficient for combating future outbreaks. If this situation should 
change, USAID will work with the other USG agencies to determine the 
appropriate measures needed and how to best meet those needs.
    In fiscal year 2011, USAID plans to support the global laboratory 
network for continued monitoring of the H1N1 virus; these laboratory 
platforms would also be supported for monitoring of the emergence of 
other new dangerous pathogens. USAID is also continuing to focus on 
community based preparedness and non-pharmaceutical interventions that 
can be put into practice in the event of a pandemic.
                                 ______
                                 
              Questions Submitted by Senator Sam Brownback

                      DEMOCRATIC REPUBLIC OF CONGO

    Question. I sent you a letter in February about USAID's programs 
and capacity to help address the underlying causes of conflict in the 
Democratic Republic of Congo, specifically the exploitation of minerals 
by armed groups. Your reply to that letter mentioned that your staffing 
resources ``may not be sufficient to cover the complex minerals 
situation'' and that USAID was considering hiring a ``senior mining 
specialist.'' First, does USAID's Mission in the DRC have sufficient 
capacity and resources to focus on the resource dimensions of the 
conflict? And if not, does USAID's budget request for the DRC reflect 
these needs? Also, has USAID hired a senior mining specialist and is 
this position reflected in USAID's budget request?
    Answer. The USAID Mission is currently exploring options to add a 
dedicated senior mining expert. At the same time, our fiscal year 2011 
budget request for DRC focuses on post-conflict programming to 
strengthen institutions of democracy and governance (notably justice 
reform), economic growth (with an emphasis on agriculture and food 
security), basic education and responding to sexual and gender-based 
violence.

                         LORD'S RESISTANCE ARMY

    Question. What USAID programs and resources are currently dedicated 
to addressing the violence perpetrated by the Lord's Resistance Army 
and assisting affected communities? Does USAID's fiscal year 2011 
budget request include resources to assist communities affected by the 
LRA?
    Answer. USAID programs in Haut and Bas Uele Districts (Orientale 
Province) currently fall in the realm of humanitarian assistance, due 
to limited access and a security situation that precludes 
stabilization, recovery, and development programming. USAID has 
responded favorably to the World Food Program's Emergency Operation of 
LRA-affected areas of Orientale Province, with a nearly $4 million 
contribution in fiscal year 2010 funds.
    Current programs of USAID's Office of U.S. Foreign Disaster 
Assistance include:
  --Premiere Urgence, Agriculture and Food Security, $2,105,085;
  --Mercy Corps Economic Recovery and Market Systems Orientale 
        Province, $980,920; and
  --WHH Agriculture and Food Security, Economic Recovery and Market 
        Systems Orientale Province, $1,998,755.
    USAID anticipates the need to program additional food and non-food 
humanitarian assistance from fiscal year 2011 FFP and OFDA 
appropriations. USAID's constraints in responding to LRA-affected 
populations are directly related to security and access. It remains 
virtually impossible to implement programs in LRA-affected areas 
without putting the beneficiaries and implementers at serious risk of 
being targeted.

                      DEMOCRATIC REPUBLIC OF CONGO

    Question. What specifically is USAID doing to address the conflict 
minerals problem and how does this fit within USAID's budget request 
for the DRC? What are the current programs within USAID to improve the 
livelihood prospects of communities affected by human rights abuses in 
eastern Congo, particularly victims of sexual and gender based 
violence?
    Answer. Illicit trade in minerals is a diplomatic and strategic 
challenge. Armed groups and renegade elements of the Congolese army 
control many of the mining sites and transit routes, while other 
militias are tied to elements in nearby countries. The ``U.S. 
Government Strategic Action Plan on Conflict Minerals in the Eastern 
Democratic Republic of the Congo'' includes diplomatic and strategic 
responses as well as use of foreign assistance to strengthen 
institutional and regulatory capacity to formalize trade in minerals 
and socio-economic activities for affected communities.
    USAID's analytical work contributed to the knowledge base around 
this complex set of issues and our programming supports key sectors 
such as improved governance, rule of law and economic development which 
are all essential to addressing the underlying vulnerabilities which 
allow conflict to be fueled through the rich resource base of the DRC. 
A number of USAID programs in southern and eastern DRC have sought to 
address issues, such as reintegration of ex-combatants and community-
based economic recovery in conflict-affected areas as well as improved 
local governance of resource revenues. Comprehensive reintegration 
programs reduce the likelihood that ex-combatants will be recruited 
into illicit enterprises or re-recruited into armed groups that control 
much of illegal minerals trade.
    In support of the Strategic Action Plan on Conflict Mining, State 
and USAID are currently considering program options to: (1) strengthen 
trade route monitoring, through police training, to secure borders and 
track movement of resources; (2) develop safe transit routes through 
construction and rehabilitation of key roads; and (3) promote 
strategic, regulatory, and institutional reforms to formalize minerals 
trade and develop systems of traceability.
    In communities affected by human rights abuses, USAID promotes 
humanitarian assistance programs and supports stabilization and 
recovery through the use of Economic Support Funds and Public Law 480 
developmental food aid programs.
    USAID's fiscal year 2011 budget request does not specifically 
request funding to combat illicit mining. The ESF request, which 
includes funding for agriculture, microenterprise, water, and 
education, focuses on post-conflict programming to strengthen 
institutions of democracy and governance (notably justice reform), 
economic growth (with an emphasis on agriculture and food security), 
basic education and responding to sexual and gender-based violence.
    With respect to livelihoods for affected communities, USAID has 
requested fiscal year 2011 funding for stabilization and recovery ($2 
million), Sexual and Gender Based Violence ($2.5 million) and Public 
Law 480 Development Food Aid ($30 million).
Humanitarian Assistance
    In fiscal year 2010 to date, USAID has provided more than $6.3 
million in humanitarian assistance, for agriculture and food security, 
health, nutrition, protection, and water and sanitation programs in the 
DRC. In fiscal year 2009, USAID provided nearly $34 million for 
humanitarian programs, many of which remain ongoing and include 
activities such as agriculture and food security, economic recovery and 
market systems, humanitarian coordination and information management, 
health, logistics and relief commodities, nutrition, protection, 
shelter and settlements, and water, sanitation, and hygiene program.
Stabilization and Recovery
    Programs to improve livelihoods are an integral part of USAID's 
stabilization and recovery programs, which support the return, 
reintegration and recovery and extension of state authority components 
of the International Security and Stabilization Support Strategy for 
Eastern DRC. International efforts are focused around six strategic 
axes, which include vital links to key mining areas.
    In fiscal year 2008 and fiscal year 2009, USAID received 
supplemental appropriations which allowed us to support the following 
two projects:
  --The Promote Stabilization and Ex-Combatant Reintegration in North 
        and South Kivu project ($8.2 million), which is in its early 
        stages, targets 30 communities for peace-building and 
        reconstruction activities.
  --The Support to the Stabilization Strategy along the Rutshuru-
        Ishasha Axis project ($5 million) has completed rehabilitation 
        of 63 kms of road on one of six strategic axes (Rutshuru-
        Ishasha), allowing freedom of movement, trade and economic 
        opportunity for at least 1 million people. The construction or 
        rehabilitation of 13 administrative buildings, which will allow 
        Congolese local government officials to deploy and provide 
        services to the population, is ongoing. The construction has 
        created 550 short term jobs, and direct cash inflows into 
        communities from these workers of approximately $200,000.
            Development Food Aid
  --Three Publicl Law 480, Title II, Multi-Year Assistance Programs 
        ($42 million) provide employment and support recovery of 
        livelihoods in eastern DRC. In South Kivu, USAID funds a 
        program to reduce food insecurity, focusing on female-headed 
        households and returnees.
  --In Northern Katanga, we manage a program to reduce food insecurity 
        and in Goma, North Kivu, our program is designed to improve the 
        food security status of vulnerable households and improve 
        access to potable water.
            Social Protection
  --USAID is providing 6,000 women with income generating and vocation 
        training through our 3-year project called ESPOIR (Ending 
        Sexual Violence by Promoting Opportunities and Individual 
        Rights, $7 million).
  --A different project ($4.9 million) is providing income generating 
        activities and professional training for almost 4,000 women 
        affected by SGBV.
  --A third project ($3.2 million) helps several hundred abducted 
        children (who are often victims of sexual violence) per year 
        return to school and engage in income generating activities. 
        USAID also assists communities with food insecurity issues with 
        particular attention given to female-headed households.
            Livelihoods in the Mining Sector
  --Good examples of programs addressing these underlying 
        vulnerabilities are our comprehensive reintegration programs 
        that reduce the likelihood of recruitment of ex-combatants into 
        illicit enterprises or re-recruitment into armed groups that 
        control much of illegal minerals trade. Additionally, USAID has 
        implemented an innovative program to improve governance and 
        reduce conflict associated with the exploitation of mineral 
        resources. The program, a public-private partnership which 
        leverages USAID funds, coupled with a larger private sector 
        contribution by reputable mining companies operating in Katanga 
        and focused on fostering corporate social responsibility and 
        supporting alternative livelihoods for artisanal miners, who 
        were operating in some cases illegally on private company land. 
        The program also addresses critical human rights issues around 
        the mining sites and strengthens conflict resolution mechanisms 
        among artisanal miners. In addition, the program creates local 
        development funds, which are in line with Congolese local 
        government reform processes, in order to ensure that taxes 
        gleaned from legal mining are invested back into community-
        driven development programs thus supporting economic and social 
        development objectives as well as good governance objectives.
  --The success of this intervention led to the establishment of a 
        joint U.S.-DRC Development Credit Authority activity ($378,000) 
        to provide up to $5 million in loan guarantees for small and 
        medium-scale enterprises in the key mining province of Katanga, 
        where access to credit was practically nonexistent.
  --In Bafwasende, Orientale Province, where U.N. peacekeepers, the 
        FARDC, and Mai Mai rebels all operated on a nature reserve rich 
        with valuable minerals, USAID supported a program based on 
        community-driven anti-corruption committees. The program 
        focused on conflict resolution and succeeded in getting the Mai 
        Mai to disarm, demobilize and stop pillaging the resources of 
        the reserve. The lessons learned from this project are 
        applicable to eastern DRC.
  --In addition to work with artisanal miners through the public-
        private partnership, USAID has also supported stand-alone 
        programs focused on the unique challenges of artisanal miners. 
        For example, in the town of Kolwezi in the southern Katanga 
        copper belt, one project ($597,000) seeks to (1) promote 
        reconciliation, cooperation, and understanding among artisanal 
        and small-scale mining-related institutional actors; (2) 
        prevent conflicts and risks to communities over resource access 
        and use; (3) improve access to, and awareness of, pertinent 
        mine legislation; and (4) establish a conflict resolution 
        mechanism for disputes and conflicts. The lessons learned and 
        best practices distilled from this and other innovative 
        programs have been used to inform the design of a new multi-
        million dollar, multi-donor, multi-year program focused on the 
        mining sector in the East. Called PROMINES, it is supported by 
        the World Bank and the UK's Department for International 
        Development (DfID). USAID is currently not contributing funding 
        to this project, but is exploring options for future support.

                    ECONOMIC SUPPORT FUND FOR SUDAN

    Question. Can you please explain why there is a decrease in the 
budget request for the Economic Support Fund for Sudan, an account that 
among other things is used for programs to promote basic education and 
help build infrastructure in Southern Sudan?
    Answer. The decrease in the Economic Support Fund (ESF) account 
from fiscal year 2010 to fiscal year 2011 is primarily due to the 
decreased need for resources in fiscal year 2011 to fund activities 
that support the remaining major power-sharing benchmarks of the 
Comprehensive Peace Agreement (CPA) such as public administration, 
civic participation and international observation. The overall decline 
in ESF however, does not signify a decrease in highly-needed programs 
to increase access to education or improve infrastructure.
    Per the CPA, the national elections, popular consultations and 
referenda processes in Sudan were to take place sequentially and be 
completed by January 2011. Originally scheduled for July 2009, the 
election was delayed four times before the April 2010 schedule was 
announced and implemented. USAID supported electoral activities with 
ESF from fiscal year 2008 regular appropriations, and fiscal year 2008 
and fiscal year 2009 supplemental funds. At the moment, the timeline 
for the referenda in January 2011 is holding. The timeline for popular 
consultations in Southern Kordofan and Blue Nile states is less clear, 
due to postponed legislative and gubernatorial elections in Southern 
Kordofan which have yet to be implemented. However, we presently 
anticipate that these processes will be completed before fiscal year 
2011 resources will be available for programming.

                                 SUDAN

    Question. What resources and staffing needs has USAID incorporated 
into the fiscal year 2011 budget request that are dedicated to assist 
Sudan in all possible outcomes of the referendum, including a Southern 
Sudanese government that will need resources and technical assistance 
to begin a new chapter as a sovereign nation or the possibility of a 
failed referendum renewing a civil war in Sudan?
    Answer. Fiscal year 2011 will be a critical year for Sudan as it 
continues on the path toward peaceful democratic transformation. It 
will also be a year in which flexibility in U.S. assistance is 
required, pending outcomes of the referenda on the future status of 
southern Sudan and Abyei and popular consultations in Blue Nile and 
Southern Kordofan States. There will be an urgent need to support the 
outcomes and build consensus for these processes and the outcome of the 
general elections in April 2010 that are adjusting the power- balances 
in the national, regional, and State governments.
    The fiscal year 2011 budget request represents a joint USAID and 
State Department estimate of program resources needed to assist Sudan 
in all possible outcomes of the southern Sudan referendum, whether 
southern Sudan votes for independence or chooses to remain part of a 
unified Sudan. To support these outcomes, USAID has worked closely with 
the State Department to plan for an immediate, expanded presence in 
Juba to implement programs critical to stabilizing the South in the 
critical pre-referenda period and immediate aftermath. The additional 
staff will bolster USG diplomatic functions and capacity for State-
managed peace and security and rule of law programs which complement 
USAID's robust programs and presence on the ground. USAID currently has 
65 staff assigned to Juba, including both U.S. staff and foreign 
service nationals.
    Future USAID staffing requirements will vary depending on political 
events. USAID is reviewing multiple scenarios and analyzing associated 
staffing requirements for 2011 and 2012.
    USAID will continue to deploy staff, respond to humanitarian 
emergencies and support traditional development programs, such as 
investing in human capacity and health and expanding infrastructure and 
economic opportunities. In coordination with other donors, State and 
USAID will jointly implement resources to strengthen the capacity of 
the Government of Southern Sudan (GOSS), bolster rule of law 
institutions and capacity, and to mitigate and respond to conflict 
throughout Sudan.
Transition and development programming
    USAID's assistance will be geared toward addressing the threat of 
new or renewed conflict in the Three Areas, as well as a potential 
increase in tension between the north and the south in the run-up to 
the 2011 referenda. Consequently, a higher proportion of resources will 
be dedicated to conflict prevention and mitigation.
    USAID will continue to work on the extension of state authority 
throughout southern Sudan aiming to prevent conflict. Funding will also 
be directed at mediating and preventing conflict around post-2011 
issues including cross border development; security and movement; and 
inter-ethnic relationships. USAID's transition and conflict management 
program provides a quick and flexible mechanism for direct technical 
and material support to reinforce diplomatic efforts to address these 
issues.
    Supporting the development of democratic governance in southern 
Sudan and the Three Areas will continue to be critical regardless of 
the outcome of referenda and popular consultations. USAID assistance 
will build on efforts made since the signing of the CPA to strengthen 
capacity in core government functions to enable expanded service 
delivery, and deepen the accountability, transparency and 
responsiveness of key institutions in the GOSS and the Three Areas. 
Additionally, strengthening the legislative assembly that is inducted 
after the elections; enhancing government understanding of public 
views; building consensus between leaders and constituencies; 
strengthening the capacity of political parties to conduct outreach to 
and represent their constituents in the newly elected legislative 
assembly after the April 2010 elections; and, strengthening civic 
participation, bolstering civil society and expanding access to free 
and independent information will all continue to be elements of USAID 
assistance. Technical assistance and southern Sudan capacity-building 
will also align with post-2011 arrangements.
    USAID will monitor developments regarding Sudan's subsequent post-
CPA arrangements, which may include elections and other political 
processes. USAID, in coordination with the State Department, will 
program fiscal year 2011 ESF funding to begin supporting these 
processes.
Humanitarian Assistance
    As with natural and complex disasters throughout the world, USAID 
remains prepared to respond to pre- and post-referendum deterioration 
in the humanitarian situation in Southern Sudan. USAID humanitarian 
programs are flexible and able to reallocate resources to meet emerging 
humanitarian needs.
    USAID has taken the following concrete steps to proactively prepare 
for potential post-referendum humanitarian needs in southern Sudan:
  --In order to rapidly respond to population displacement in southern 
        Sudan, USAID supports an international organization to 
        stockpile emergency relief supplies and to rapidly provide safe 
        drinking water and dispatch mobile health clinics, as needed.
  --USAID supports strong local and international partners operating in 
        rural areas of southern Sudan to provide assistance to recently 
        returned populations and to prepare to respond quickly to 
        potential outbreaks of violence in the months leading to and 
        following the January 2011 referenda. Ongoing USAID support 
        allows partners to continue to deliver essential basic 
        services, with a focus on health, agriculture and food 
        security, and water, sanitation, and hygiene in areas of 
        highest population movement or IDP return depending on the 
        scenario.
  --Depending on the magnitude of the deterioration, USAID remains 
        prepared to rapidly deploy USAID humanitarian personnel to 
        southern Sudan, ranging from regional advisors and field 
        officers to assessment teams or a disaster assistance response 
        team.
    The combination of these three capacities will ensure that USAID is 
able to respond to the immediate humanitarian impacts of the referenda 
in either scenario and within the current budget request.
            Independence Scenarios
    In a steady-state scenario where the referenda results in a 
peaceful separation, USAID expects humanitarian needs across Sudan to 
be roughly similar to 2009. USAID will continue to maintain both World 
Food Program (WFP) and private voluntary organization (PVO) food aid 
supplies, with PVO partners engaged in recovery activities in southern 
Sudan.
    However, populations could initially experience violence 
surrounding the results. The scale and scope of the humanitarian need 
will be proportional to the level and duration of violence. Should the 
resulting conflict be short-term in nature, the situation would require 
an immediate surge in humanitarian resources closely followed by 
complementary transition and/or development investments as has occurred 
in southern Sudan over the course of the Comprehensive Peace Agreement 
implementation (CPA), for example, following the violence in Abyei in 
May 2008 and in Akobo, Jonglei state, in early 2009.
    A longer-term conflict may result in the need for protracted 
humanitarian engagement requiring substantial financial and human 
resources. As conflict surrounding the referenda subsides, or if no 
violence occurs, humanitarian agencies can expect returns to increase. 
An increase in returns will necessitate a shift in the focus of 
humanitarian programming to ensure that returns are adequately 
supported, resulting in additional resource requirements for 
humanitarian activities in the near-term and development activities in 
the medium- to long-term.
            Return to war Scenarios
    A return to war will require a significant increase in humanitarian 
resources to address mass displacements. The scale and scope of 
resources required to address a return to war will depend on the level 
and geographic spread of the violence and on the access our 
humanitarian partners have to populations in need. With respect to 
food, USAID would increase contributions, and partners would be 
positioned to expand beneficiary caseloads and programmatic coverage. 
In either case, USAID would plan to increase staff to bolster capacity 
on the ground, to include local staff for food security program 
monitoring.

                    HUMAN RIGHTS CONDITIONS IN SUDAN

    Question. What resources and personnel is USAID employing to 
monitor and report on human rights conditions throughout Sudan?
    Answer. Human rights monitoring and reporting is currently not 
within USAID's mandate in Sudan. As presently structured, U.S. 
Government long-term development assistance in Sudan to monitor and 
report on human rights is done by the Department of State.

                     ASSISTANCE TO BURMESE REFUGEES

    Question. International NGOs continue to report on periodic violent 
attacks against Burmese Rohingya refugees in Thailand and Bangladesh. 
What resources is USAID employing to offer assistance to the Rohingya 
refugees?
    Answer. USAID follows closely the situation of Burmese Rohingya 
refugees and asylum seekers in Bangladesh, Thailand, and elsewhere in 
the region. We are concerned by credible reports of a growing 
humanitarian crisis among the unregistered Rohingya population residing 
outside of Kutupalong refugee camp in Bangladesh, and the numbers of 
arrests and push-backs to Burma at the border.
    U.S. Government efforts to address protection and assistance needs 
of the Rohingya refugee population are led by the Department of State's 
Bureau of Population, Refugees and Migration (State/PRM). In fiscal 
year 2009, State/PRM provided funding of more than $2 million to 
several international humanitarian organizations to assist both 
registered and unregistered Rohingya populations in Bangladesh, 
Malaysia, Indonesia, and elsewhere in the region. Humanitarian 
assistance for the Rohingya includes healthcare, water and sanitation, 
education, vocational skills training, conflict resolution, community 
mobilization, mental health and psychosocial support, gender-based 
violence prevention, and access to essential services for Persons with 
Disabilities.
    Cox's Bazar, the southeast district where most Rohingya residing in 
Bangladesh live, is one of the poorest districts in the country. In 
addition to high levels of illiteracy and malnutrition, 73 percent of 
the population lives below the poverty line. Much of the conflict is 
the result of host-community and Rohingya competing for the region's 
limited resources. The problems facing the Rohingya cannot be solved 
without addressing the issues of the broader host-community.
    USAID programs benefit the sizeable unregistered Rohingya 
population living in the Cox's Bazar region of southeast Bangladesh. 
Health programs focus on low-cost family planning services, maternal 
and child healthcare, and treatment for tuberculosis through a network 
of non-governmental clinics. USAID environment programs protect natural 
resources and help people use resources sustainably, particularly those 
from tropical forests. Governance activities support greater 
transparency and citizen participation in the management of public 
resources at the local level. Additionally, USAID's new 5 year, $210 
million Public Law 480 Title II program throughout the country will 
support projects in Cox's Bazar to promote economic development of the 
entire southeast portion of the country. U.S. Pacific Command (PACOM) 
is also constructing multi-purpose cyclone shelters and schools in 
southeast Bangladesh.
    With respect to USAID programs for vulnerable Burmese populations, 
USAID has not provided funds to assist Rohingya refugees as an 
identifiable subset of its programs. However, USAID implements 
humanitarian assistance programs for vulnerable Burmese along the 
Thailand/Burma border, and within Burma for people affected by Cyclone 
Nargis. Rohingya refugees living in these locations benefit from this 
assistance.

                         TRAFFICKING IN PERSONS

    Question. The budget request to combat Trafficking in Persons seems 
inadequate. If USAID were to have more resources devoted to combating 
trafficking, how would they be used?
    Answer. The Administration is deeply committed to combating 
trafficking in persons. The President's request for anti-trafficking 
programs increased from $31.5 million for fiscal year 2010 to $35.8 
million for fiscal year 2011. Between 2001 and 2009, USAID spent nearly 
$145 million on anti-trafficking projects in more than 70 countries as 
part of the coordinated U.S. government effort to eradicate 
trafficking. USAID programs focus on prevention, protection, and 
prosecution and address both sex and labor trafficking of women, 
children, and men.
    Nearly 90 percent of USAID anti-trafficking programs over the last 
3 years have focused on prevention and protection. While a focus on 
prevention and protection remains essential, increased focus on 
prosecution in coordination with other USG efforts and efforts to 
address labor trafficking require additional attention. Forty-four 
percent of 2009 USAID anti-trafficking projects strengthen prosecution 
by helping foreign governments draft anti-trafficking legislation and 
train police and prosecutors. However, USAID evaluations and the TIP 
Report have demonstrated a need to increase law enforcement capacity to 
combat trafficking. Incorporating this type of capacity building into 
foreign assistance programs would be coordinated through the inter-
agency Senior Policy Operating Group (SPOG). Likewise, Agency 
assessments, the TIP Report, and the Department of Labor's 2009 TVPRA 
list indicate a need for increased global attention to labor 
trafficking. Sixty-eight percent of our anti-trafficking programs since 
2001 have addressed both labor and sex trafficking.

                              AGRICULTURE

    Question. How will USAID use the resources it has, such as programs 
like the Consultative Group on International Agricultural Research 
(CGIAR), to help develop wheat variety resistant to Ug99 wheat stem, a 
disease that is destroying Africa's wheat crop? Will that research be 
available to U.S. producers? How could USAID's efforts on food security 
be improved?
    Answer. USAID has been the lead national development agency in 
responding to the wheat stem rust alarm first raised by Dr. Norman 
Borlaug approximately 5 years ago. After almost 50 years of durable 
resistance to this most dreaded disease of wheat, Ug99 appeared as a 
virulent new strain that threatened food security in Africa, the Middle 
East and South Asia. While the disease has not yet reached an epidemic 
stage, it poses a significant threat to Africa's farmers, and with the 
right environmental conditions in South Asia, a food security disaster 
could result.
    To prevent that from happening, USAID has provided over $20 million 
in the last 5 years for wheat research by CGIAR, in partnership with 
U.S. universities and USDA's Agricultural Research Service, to identify 
and rapidly deploy resistance genes. USAID also supported expanded 
efforts by USDA's Cereal Disease Laboratory in St. Paul, as well as 
screening trials in disease hot-spots in East Africa, where global 
wheat varieties--including from the United States and Canada--were 
screened for both susceptibility and resistance.
    USAID is pleased to report that CGIAR wheat breeding efforts have 
succeeded. Using the latest molecular techniques and genetic 
information from international partnerships, new varieties of wheat 
that are resistant to the new strain have been developed, forming a 
first line of defense against a potential epidemic. Over the last 2 
years, USAID has deployed over $5 million in specially authorized 
``Famine Funds'' to rapidly multiply and scale up production of 
resistant wheat seed in Afghanistan, Pakistan, Nepal, Egypt and 
Ethiopia. USAID also has a partnership with India, which brings its own 
considerable resources to the effort. In addition, the Agency works 
with global partners as part of a disease-surveillance effort to 
monitor movement of the disease, which has now moved as far as Iran.
    More work is needed--and will be supported through the Global 
Hunger and Food Security Initiative--to build back the ``durable 
resistance'' that Dr. Borlaug achieved in the Rockefeller Foundation's 
wheat program in Mexico in the 1950s--the forerunner of CGIAR. More 
seed multiplication support will also be needed. We are working with 
our overseas missions to ensure that all partners--national 
organizations, international NGOs like Catholic Relief Services, CARE 
and others, work together to ensure farmers get access to resistant 
seed. All of the above efforts have been carried out in close 
partnership with USDA, U.S. universities and partners in Australia, 
India and elsewhere around the world. All of the resistant materials 
and genetic information about the disease and resistance to it are 
freely available from the various partners, especially the CGIAR, which 
has an explicit focus on sharing its products and information.
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich

                      MILLENNIUM DEVELOPMENT GOALS

    Question. In September, world leaders will gather at the United 
Nations to assess the Millennium Development Goals and re-commit to 
achieving the MDGs by 2015. What are your plans in preparing the U.S. 
position at the U.N. session and any proposals President Obama might 
announce?
    Answer. As President Obama underscored in his address to the U.N. 
General Assembly last year, the United States fully embraces the 
Millennium Development Goals (MDGs). The MDGs are a core principle for 
USAID, and we are pleased to be playing a leading role in the 
interagency process to develop U.S. positions for the September MDG 
High Level Plenary (Summit). The interagency process has been working 
for the past few months to define U.S. strategies and approaches toward 
accelerating progress in achieving the MDGs.
    The 2010 Summit is an important opportunity to take stock of the 
progress made so far in achieving the MDGs. In fact, significant 
progress has been made in many MDG areas, although progress has varied 
dramatically across countries and regions. In developing its position 
for the U.N. process leading up to the September Summit, the United 
States will acknowledge and highlight this progress, while considering 
ways to replicate and scale up successes. At the same time, the 
challenges ahead in making further progress on the MDGs are formidable. 
In that regard, the United States will be considering the need for new 
approaches.
    Our preparations for the September MDG Summit provide an 
opportunity to build support for a more determined, strategically-
minded and analytically-focused approach to the MDGs. We see four 
elements as critical for making more rapid progress in the next 5 
years: first, the need to focus on development outcomes, not just 
development dollars; second, the need to enhance the principle and 
practice of national ownership and mutual accountability; third, the 
need to invest in making development gains sustainable; and fourth, the 
need to make more effective use of innovation and other force-
multipliers to maximize the impact of our efforts.
    The interagency process is continuing to consider the best strategy 
and approaches to advance the MDGs. Recent Presidential initiatives, 
for example, including the Global Health Initiative (GHI) and Feed the 
Future (FTF), provide opportunities to accelerate and sustain progress 
in these important MDG areas.

                           SCALE-BACK EFFORTS

    Question. Dr. Shah, looking at the areas of growth in your budget--
particularly for health, agriculture and USAID's own capacity--it is 
evident what the Administration's priorities are for development. Can 
you tell me where you think USAID could scale back, even eliminate or 
radically reform our current efforts?
    Answer. I have recently outlined a new approach to high-impact 
development which will lie at the center of restoring USAID's 
effectiveness. The approach is premised on greater focus and 
selectivity, and includes four core areas.
    First, USAID is contributing to the U.S. commitment to the 
Millennium Development Goals (MDG), not simply by delivering services 
to those in need, but through building sustainable systems that will 
transform healthcare, education, food security and other MDG areas. 
Second, we are strengthening our ability to invest in country-owned 
models of inclusive growth and development success. Third, we are 
identifying new ways of leveraging science and technology to develop 
and deliver tools and innovations which we believe can be 
transformational. Finally, we will bring USAID's expertise to bear on 
some of the most daunting national security challenges we face as a 
Nation--including stabilizing countries like Afghanistan.
    Focusing on these core areas will allow a concentration of USAID's 
resources and its efforts rather than spreading our efforts and 
resources over the many other technical areas that relate to broad-
based and sustainable development. Other areas of development 
engagement will be scaled-backed if they do not support the core 
objectives.
    On June 8, White House Chief of Staff Rahm Emanuel and OMB Director 
Peter Orszag sent a letter to the heads of all executive departments 
and agencies asking them to identify those programs that have the 
lowest impact on each agency's mission, and that constitute at least 5 
percent of each agency's discretionary budget. I fully support this 
effort, and USAID will meet or exceed the 5 percent target set by Chief 
of Staff Emanuel and Director Orszag. By identifying those areas where 
we can scale back or eliminate projects and programs, this exercise 
will help USAID further focus our financial and human capital on the 
four core areas described above.

                               PSD-7/QDDR

    Question. Dr. Shah, could you give us an update on the multiple 
efforts going on right now on reforming and improving our aid 
processes, including the QDDR and PSD? How do initiatives such as the 
Global Health initiative and Food security initiative fit within the 
proposed reforms?
    Answer. I anticipate that the QDDR and PSD exercises, in which we 
are actively participating, will have a very positive impact on USAID 
and U.S. global development efforts, including the Global Health (GHI) 
and Feed the Future/Global Hunger and Food Security Initiative. Both 
exercises are looking at how the initiatives could be affected by 
possible reforms. For example, a joint USAID-State QDDR task force is 
examining how to increase our capabilities around the issue of aid 
effectiveness, and in doing so is explicitly looking at how the 
effectiveness principles (country ownership, alignment, harmonization, 
managing for results, and mutual accountability) should be applied to 
both initiatives.
    A focus on factors that improve aid effectiveness, such as 
promoting country ownership, learning, cost-effective and streamlined 
processes, a whole-of-government approach, and donor coordination are 
key principles of both the GHI and the Food security initiative. These 
same principles are the focus of work under both QDDR and PSD.
    For example, through the GHI we will help partner countries improve 
health outcomes through strengthened health systems. A core principle 
underlying the GHI business model in support of reaching these 
ambitious health goals is to encourage country ownership and invest in 
country-led plans. The GHI works closely with partner governments, as 
well as civil society organizations, to ensure that investments are 
aligned with national priorities, and to support partner government's 
commitment and capacity so that investments are maintained in the 
future. Further, our efforts to strengthen country efforts will be 
coordinated across USG agencies and other partners to ensure efficient 
use of resources and effective results.

                        CIVILIAN RESPONSE CORPS

    Question. One of the concerns our military commanders have shared 
with us and others over the years is the lack of civilian follow up 
operations in places like Iraq and Afghanistan. As the USAID 
Administrator, how do you intend to build a cadre of dedicated staff at 
USAID that can move into post-conflict regions and begin long-term 
civilian stabilization and reconstruction (S&R)?
    Answer. USAID is dedicated to assisting in follow-up stabilization 
and reconstruction efforts in post-conflict regions. To accomplish 
this, we have built up a cadre of both immediate, rapid response 
networks and longer-term staff.
    To address immediate stabilization and reconstruction issues, USAID 
is responsible for a large contingent of Civilian Response Corps (CRC) 
personnel, managed by the Agency's Office of Civilian Response. The CRC 
focuses on restoring rule of law and stabilizing war-torn societies as 
a precursor to sustained economic growth.
    The CRC currently has two components: the Active and the Standby. 
The Active Component (CRC-A) will ultimately be comprised of 250 U.S. 
Government (USG) members, 91 of which will be from USAID. CRC-A members 
are direct-hire employees who form a team of first responders available 
to deploy within 48 hours of call-up for up to 12 months. CRC members 
within USAID are mostly senior-level, highly experienced personnel with 
S&R experience. They receive 3-4 months of training to prepare them for 
S&R operations. The Standby Component (CRC-S) interagency target is 
2,000 members, with a USAID target of 744 members. CRC-S is comprised 
of current USG employees who sign up for and are accepted to the CRC. 
They receive 2-4 weeks of S&R training and can be deployed within 30-45 
days.
    USAID CRC-A and CRC-S staff have already successfully deployed to 
Afghanistan, Pakistan, Sudan, Kenya, Somalia, Democratic Republic of 
Congo, Yemen, Sri Lanka, Kyrgyzstan, Nigeria, Nepal, Kazakhstan, and 
Haiti. In addition, they have participated in exercises with the 
Defense Department's European Command (EUCOM) and Africa Command 
(AFRICOM). Deployments differ in length from a few months to a year.
    The Agency is also building its Foreign Service cadre through the 
Development Leadership Initiative (DLI). The initiative, introduced in 
2008, is aimed at increasing USAID's ability to meet its development 
and national security objectives through a strong workforce. The goal 
of DLI is to double the USAID Foreign Service workforce by hiring 1,200 
junior and mid-level Foreign Service officers by 2012. To date, 483 new 
officers have been sworn in and oriented under this initiative; 89 will 
specifically focus on Crisis, Stabilization and Governance issues. This 
cadre of new Foreign Service officers will strengthen the Agency's 
capacity to provide leadership overseas to develop, carry out, and 
integrate programs that bring peace, prosperity, and security to the 
world.

                    LONG-TERM DEVELOPMENT IN AFRICA

    Question. Africa, as you know, remains a continent which suffers 
not just from extreme poverty, but from disease, lack of basic needs 
like clean water and food, and a dearth of educational and economic 
opportunities. Some nations in Africa even face the increasing 
influence of corrupt governments, terrorist organizations, drug 
traffickers and other destabilizing influences. One of the key ways 
these issues can be addressed is through strong, comprehensive and 
long-term development strategies that are designed to offer solutions 
to these destabilizing forces. What resources will USAID need to 
address these problems and how would you convince the American people 
that such expenditures would serve the national interests of the United 
States?
    Answer. Africa is vital to U.S. interests. Home to approximately 
800 million people, Africa is increasingly linked to global markets, 
holds vast natural resources, and will soon provide 25 percent of U.S. 
oil imports. There has rarely been a more critical time to consolidate 
the progress and promise of Africa. Although wars in Liberia, the 
Democratic Republic of the Congo (DRC), Angola, Burundi, Uganda, and 
Sierra Leone, and the North-South conflict in Sudan have ended or 
dramatically abated, sub-Saharan Africa has recently experienced 
significant stagnation and challenges to its progress toward democracy 
and good governance. Most worrying have been the democratic setbacks in 
countries that have historically been considered ``good performers,'' 
but that are at risk of political instability. Regional bodies such as 
the African Union have a growing potential to provide leadership and 
share best practices, but the influence of poorly governed and 
autocratic states on these multilateral institutions complicates and 
stifles the evolution toward better governance in Africa.
    It is in the interest of the United States for Africa to be stable, 
well-governed, and economically self-sufficient with healthy and 
productive populations. Poor governance, conflict, and corruption 
contribute to the need for billions of dollars per year in food and 
non-food emergency assistance from the United States and other 
bilateral and multilateral donors that could be used to solve other 
global problems. Lacking any sustained political and economic 
improvements, and with Africa's population expected to double by 2050 
to 1.8 billion, the continent's humanitarian needs will only escalate. 
The stakes are extremely high. However, strategic use of USG foreign 
assistance resources, combined with those from other bilateral and 
multilateral donors, can make a meaningful difference in Africa by 
creating tangible improvements in quality of life and building momentum 
toward political and economic progress.
    Our programs have already made significant contributions, including 
contributing to reducing mortality among children under five by 14 
percent since 1990, and increasing the number of children enrolled in 
primary school by 36 percent since 1999. To sustain and consolidate 
these gains in the face of current projected population growth requires 
a multi-pronged approach that addresses the key issues for the 
continent and can produce visible impacts at the country and regional 
level. The Africa Bureau's fiscal year 2011 foreign assistance request 
of $7.606 billion, which includes $3.728 billion of HIV/AIDS funding, 
directly advances key Administration policy priorities in the areas of 
democracy and governance, peace and security, economic growth and food 
security, health and education (including HIV/AIDS and malaria), and 
transnational challenges, including global climate change.
    When combined with the $3.9 billion currently committed to Africa 
through Millennium Challenge Corporation (MCC) Threshold programs and 
Compacts to date, and the annual average of $25.67 billion in other 
bilateral and multilateral donor assistance to Africa, the 
international community has the ability to effect real change. Within 
the United States, close coordination between the major U.S. agencies 
(MCC, State and USAID) has facilitated optimal use of funding. For 
example, USAID implements all the Threshold Programs for MCC in Africa, 
and is implementing some portions of the Compact in Burkina Faso. MCC 
Compact Teams coordinate closely with Ambassadors at post, and with 
USAID staff as appropriate. Another example is Senegal, where starting 
in July 2003 (even prior to the formal creation of the MCC), USAID 
provided $500,000 to enable the Government of Senegal to assess and 
strengthen its systems for managing development resources and developed 
a methodology that could be used in future MCC-eligible countries to 
accelerate start-up of MCC programs.

                       PROMOTING GOOD GOVERNANCE

    Question. We all recognize that corruption and weak governance are 
challenges in many of the poorest nations. What are some of the 
strategies USAID uses to promote good governance through our assistance 
programs? Is there legislation that could enhance these efforts?
    Answer. USAID's overall objective in governance is to provide 
assistance and training to promote greater transparency, 
accountability, effectiveness and participation in governing 
institutions and public policy processes at all levels.
    Specific Anticorruption Initiatives promote accountable and 
transparent governing institutions, processes and policies across all 
development sectors. For example, USAID programs:
  --Promote corruption prevention and education while also supporting 
        prosecution and enforcement through rule of law programming.
  --Focus on regulatory and procedural reform, increasing management 
        capacity within the executive branch, and strengthening the 
        oversight capacity of the judicial and legislative branches of 
        government.
  --Strengthen public financial management, procurement reform, audit 
        and internal controls, and transparency and accountability in 
        budget processes.
  --Support anticorruption commissions, ombudsman offices, civil 
        society, media oversight and advocacy capacity building.
  --Support host country multi-stakeholder initiatives such as the 
        Extractive Industries Transparency Initiative to improve 
        governance and public oversight in resource-rich countries.
    Executive offices, ministries, and independent governmental bodies 
are advised and trained on development and implementation of policies, 
procedures, and skill sets (including leadership, strategic management 
and communications). Assistance promotes linkages between different 
branches, levels and functions of government, including across 
development sectors such as health, education and economic growth, and 
enhances financial management and civil service reforms, public-private 
partnerships, and outreach to citizens.
    Security sector democratic governance programs focus on how 
component parts of the security system (e.g., policy, military, justice 
system, legislature, civil society) are linked and must all perform 
effectively and in a coordinated manner to achieve effective, 
legitimate security systems governed by law and accountable to the 
population. Program examples include reforming the justice system, the 
civil service and public management; enhancing strategic planning, 
policy and budget formulation; increasing civilian oversight of the 
security sector. As police are an important face of the government to 
citizens, USAID supports civilian police assistance programs.
    National and sub-national efforts support democratic 
decentralization of political, financial, and administrative authority, 
ensuring all levels are capable of effecting democratic and accountable 
local governance. Technical assistance and training strengthen 
development of budgets, local revenue raising, provision of public 
services, community planning, participation, and implementation of 
laws, regulations, policies and programs.
    Assistance to legislatures supports more democratic practices 
within legislative bodies, improves legislative processes, and 
increases the quality of legislation or constitutional reforms. 
Programs increase the legislature's capacity to be responsive to 
constituents, engage in policy-making, hold itself and the executive 
accountable, and oversee the implementation of government programs, 
budgets, and laws.
    Media freedom and access to Information legislation are promoted to 
improve enabling environments for the existence and operations of NGOs 
and to increase transparency and accountability in the public sector 
while strengthening democratic practices and enabling civic engagement.
    The Quadrennial Diplomacy and Development Review (QDDR) is 
reviewing all foreign assistance programs. As part of this process, 
legislative requirements to improve the effectiveness of governance 
assistance programs are being considered. We look forward to consulting 
with the Committee and others in Congress as we formulate 
recommendations and next steps on this critical issue.

                         CONCLUSION OF HEARINGS

    Senator Leahy. If there is nothing further, the 
subcommittee was stand in recess.
    [Whereupon, at 11:56 a.m., Tuesday, April 20, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]
