[Congressional Record Volume 142, Number 119 (Wednesday, September 4, 1996)]
[Extensions of Remarks]
[Page E1509]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    TESTIMONY OF DR. KENNETH LUTGEN

                                 ______
                                 

                       HON. GEORGE P. RADANOVICH

                             of california

                    in the house of representatives

                      Wednesday, September 4, 1996

  Mr. RADANOVICH. Mr. Speaker, I recently learned that Dr. Kenneth 
Lutgen, deputy general secretary for the United Methodist Committee on 
Relief will be testifying this fall before the Senate Foreign Relations 
Committee, Subcommittee on European Affairs. Dr. Lutgen is an 
insightful individual who possesses an excellent command of the 
projects necessary to bring economic stability and political calm back 
to the war-torn areas of Bosnia. I would like to include for the Record 
a useful summary that Dr. Lutgen has provided me in advance of his 
subcommittee remarks.

   Summary of Proposed Testimony on the Bosnian Peace Process by the 
  United Methodist Committee on Relief [UMCOR] to the Senate Foreign 
         Relations Committee, Subcommittee on European Affairs

       The testimony will be presented by Dr. Kenneth Lutgen, the 
     Deputy General Secretary for the United Methodist Committee 
     on Relief.
       Dr. Lutgen will present a summary of UMCOR's programs in 
     Bosnia and Herzegovina. The UMCOR Former Yugoslavia Program 
     began in 1993 and has since expanded to over 15 projects, 
     with a current total value of over $42,000,000. UMCOR is 
     operating out of eight program offices throughout Bosnia and 
     has a staff of over 220.
       UMCOR, as well as other non-governmental organizations 
     (NGOs) operating in Bosnia, is deeply concerned about the 
     current U.S. Government policy toward assistance to the 
     Bosnian reconstruction. As we understand it, the current 
     policy of the U.S. Agency for International Development 
     (USAID) is to channel all funds for Bosnia through two 
     projects, (1) the Municipal Infrastructure project, and (2) 
     the Bosnia Reconstruction Finance Facility. These projects 
     are designed to work primarily through U.S. contractors and 
     banks, large Bosnian firms, and the Bosnian Government. There 
     will be no funds available directly to assist vulnerable 
     groups, repatriating refugees, or microenterprises, groups 
     traditionally reached by NGO activities.
       We feel that these projects overlook the benefits NGOs can 
     provide to reaching other groups, as well as a longer-term 
     effect on the Peace Process and the strengthening of 
     democracy in Bosnia.
       The unique benefits of NGOs include:
       Constituency: Many NGOs have large constituencies who 
     support their overseas programs. UMCOR represents 10 million 
     United Methodists worldwide who support projects with cash, 
     relief supplies, and their own time. UMCOR has sent over 250 
     United Methodist volunteers into Bosnia, providing assistance 
     in everything from building construction to skilled 
     psychological support for traumatized youth. UMCOR has 
     contributed about $4.7 million in private resources to Bosnia 
     since 1993.
       Rapid Response: NGOs are on the ground, have the 
     experience, connections, and demonstrated capacity to move 
     quickly when the U.S. Government wants something done. When 
     the U.S. Government wanted to implement $25 million worth of 
     housing reconstruction immediately this year, they turned to 
     the NGOs.
       Competitive Pricing: NGOs were not allowed to compete for 
     MIS and BRFF. We feel that NGOs can do provide the same level 
     of work as a for-profit contractor at a lower price and, in 
     addition, bring substantial in-kind contribution to the 
     projects. NGOs have the capacity to implement large programs: 
     UMCOR is currently implementing a $30 million Shelter 
     Materials project funded by the United Nations High 
     Commissioner for Refugees and a $6.3 million Emergency 
     Shelter program funded by USAID/Office of Foreign Disaster 
     Assistance.
       Sustainability: While a contractor will do the job and 
     leave, NGOs are committed towards sustainable development and 
     consider the development of capable local organizations an 
     important goal of their activities. UMCOR's USAID-funded 
     Municipal Rehabilitation Project has rebuilt houses and 
     community facilities, while promoting inter-ethnic 
     cooperation which will last long after UMCOR leaves Bosnia.
       Strengthening of Democracy: Many of the activities of NGOs 
     directly implement the goals of the Dayton accord, such as 
     conflict resolution, electoral mobilization, and inter-ethnic 
     cooperation.
       Civilian Security: NGOs, by working closely with 
     beneficiaries, provide a sense of security. Throughout the 
     war, NGOs were there for the most vulnerable groups and have 
     built up credibility with Bosnians. Working with for-profit 
     groups brings in new players with no credibility at the grass 
     roots level.
       Positive Popular Impact: NGOs are popular with Bosnians and 
     present a positive image for the U.S. Groups whose principal 
     goal is to help the Bosnian people increase good will towards 
     the U.S.
       We agree with the need for large infrastructure and 
     enterprise promotion programs, but we feel that this is not a 
     complete response to the needs of the Bosnian people and the 
     Bosnian Peace Process.
       We feel that the USAID projects are overly top-down and do 
     not address the needs of vulnerable groups.
       There will be no funds specifically for income-generation, 
     which would reach those in-need. Instead funds are channeled 
     only through large-scale enterprise promotion vehicles.
       Sectors where NGOs typically work, including education, 
     social programs, promotion of civil society, and conflict 
     resolution, are being neglected by current U.S. Government 
     assistance.
       The MIS and BRFF projects work with new players who will 
     need to build up relations and experience of working in 
     Bosnia's unique environment. This represents time lost in 
     Bosnia's reconstruction.
       Therefore, UMCOR recommends the following changes to the 
     U.S. Government civilian policy in Bosnia:
       1. That the U.S. Agency for International Development 
     (USAID) make future funding for the Municipal Infrastructure 
     Program (MIS) available through open bidding, allowing NGOs 
     to compete.
       2. That $30 million be set aside for NGOs from the Bosnian 
     Reconstruction Finance Facility (BRFF) to implement 
     microenterprise activities.
       3. That the $10 million in agricultural resources currently 
     set aside for the USDA Food for Progress program for Bosnia 
     be made available to NGOs to implement food or monetization 
     programs.
       4. That the USAID Partnership with NGOs be re-established 
     in Bosnia and Herzegovina.


                               conclusion

       We have heard the U.S. Government speak of the need for a 
     relief-to-development ``continuum,'' in which an emphasis is 
     made to ensure a smooth transition from relief activities to 
     more sustainable development activities. We do not believe 
     the current policy is following a continuum. Rather than 
     including all levels of Bosnian society, the U.S. Government 
     is making a rapid shift toward working only with the Bosnian 
     Government and larger businesses. This limits assistance 
     which is direct to vulnerable groups and microenterprises 
     which potentially could employ significant numbers of people. 
     This policy is not a continuum, it is a step backwards, away 
     from all the accomplishments made by U.S. Government 
     assistance in Bosnia over the last few years.

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