Foreign Assistance: Clearer Guidance Needed on When to Use Cash Grants
(Chapter Report, 12/22/93, GAO/NSIAD-94-30).

The Agency for International Development (AID) provided nearly $10
billion in cash grant assistance during fiscal years 1989-92.  This
report (1) analyzes the use of cash grant assistance to buy U.S. goods
and services, (2) assesses AID's systems for ensuring accountability and
monitoring of the use of cash grant assistance, and (3) evaluates AID's
basis for deciding when to use cash grants rather than other forms of
assistance to achieve U.S. objectives. AID prefers, but does not
require, that cash grant recipients use the money to buy U.S. goods.
AID reports that for fiscal year 1992, recipient countries used an
estimated 83 percent of all cash grants to repay debts; about 17 percent
was used to purchase goods, of which about half was used to directly
purchase U.S. goods, but these data are of doubtful accuracy.  At the
six missions GAO visited--Bolivia, Egypt, Ghana, Nicaragua, the
Philippines, and Tanzania--AID generally maintained adequate
accountability and monitoring controls as required by law and AID
guidance.  GAO recommends, however, that AID provide clear guidance to
overseas missions on choosing among various forms of assistance,
including cash grants, and that the missions fully document the reasons
for their choices.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-94-30
     TITLE:  Foreign Assistance: Clearer Guidance Needed on When to Use 
             Cash Grants
      DATE:  12/22/93
   SUBJECT:  Grant administration
             Foreign aid programs
             Foreign economic assistance
             International economic relations
             Internal controls
             Project monitoring
             Grant monitoring
             Cash management
             Accountability
             Personnel management
IDENTIFIER:  Economic Support Fund
             AID Commodity Import Program
             Bolivia
             Egypt
             Ghana
             Nicaragua
             Philippines
             Tanzania
             Israel
             Turkey
             Portugal
             AID Development Assistance Program
             African Development Fund
             AID Special Assistance Initiative
             International Monetary Fund
             AID Multilateral Assistance Initiative Program
             Ethiopia
             Africa
             Jordan
             Latin America
             AID Buy American Reporting System
             Pakistan
             World Bank Special Program of Assistance
             Colombia
             Panama
             
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