International Affairs Budget: Framework for Assessing Relevance,
Priority, and Efficiency (Testimony, 10/30/97, GAO/T-NSIAD-98-18).

Pursuant to a congressional request, GAO discussed the programs and
activities funded by the international affairs budget, the function 150
account of the federal budget, focusing on the issues that should be
raised in assessing the current programs and activities on the books
that support U.S. foreign policy and economic objectives.

GAO noted that: (1) funding in the 150 account, which totalled $18.1
billion in fiscal year 1997, constitutes only 1 percent of the federal
budget and just 3 to 4 percent of discretionary funding; (2) these
expenditures fund activities that are designed to influence world
political and economic agendas; (3) to support its interest in such
agendas, the U.S. government maintains a worldwide infrastructure of
embassies, missions, consulates, and trade offices, with an overseas
staff of more than 35,000; (4) the 150 account funds a wide range of
programs and activities; (5) a large percentage of the funds in the
account is directed by Congress or the President for specific countries
and purposes; (6) to facilitate the examination of 150 account funding,
GAO grouped the various programs and activities into six categories: (a)
security and peacekeeping operations; (b) bilateral assistance; (c)
foreign affairs management; (d) public diplomacy; (e) multilateral
assistance; and (f) trade and investment; and (7) GAO presented
information on the funding levels and trends for activities in each of
the six categories and also discussed the particular set of issues and
questions that could be raised with respect to relevance, priority, and
efficiency.

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

 REPORTNUM:  T-NSIAD-98-18
     TITLE:  International Affairs Budget: Framework for Assessing 
             Relevance, Priority, and Efficiency
      DATE:  10/30/97
   SUBJECT:  Foreign aid programs
             Foreign economic assistance
             Foreign military assistance
             National defense operations
             Developing countries
             Public diplomacy
             Foreign policies
             International relations
             International trade
             International organizations

             
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Cover
================================================================ COVER


Before the Committee on the Budget, U.  S.  Senate

For Release on Delivery
Expected at
2:00 p.m., EST
Thursday,
October 30, 1997

INTERNATIONAL AFFAIRS BUDGET -
FRAMEWORK FOR ASSESSING RELEVANCE,
PRIORITY, AND EFFICIENCY

Statement of Benjamin F.  Nelson, Director, International Relations
and Trade Issues, National Security and International Affairs
Division

GAO/T-NSIAD-98-18

GAO/NSIAD-98-18T

International Affairs Budget

(711293)


Abbreviations
=============================================================== ABBREV

  ACDA - Arms control and Disarmament Agency
  AIDS - Acquired Immune Deficiency Syndrome
  COMSAT - Communication Satellite Corporation
  EPA - Environmental Protection Agency
  FBI - Federal Bureau of Investigation
  GAO - General Accounting Office
  GPRA - Government Performance and Results Act
  IDA - International Development Association
  NASA - National aeronautics and Space Administration
  NATO - North Atlantic Treaty Organization
  EXIMBANK - U.S.  Export-Import Bank
  USAID - U.S.  Agency for International Development
  USIA - U.S.  Information Agency
  UN - United Nations
  OPIC - Overseas Private Investment Corporation
  NIS - newly independent states

============================================================ Chapter 0

Mr.  Chairman and Members of the Committee: 

I am pleased to be here today to discuss the programs and activities
funded by the international affairs budget--the "function 150"
account of the federal budget.  As you requested, my goal today is to
help set the stage for a thoughtful examination of the issues that
should be raised in assessing the current programs and activities on
the books that support U.S.  foreign policy and economic objectives. 
To date, no one has undertaken such a comprehensive review of 150
account activities.  This examination appears to be warranted in
light of the dramatically changed world environment and new budget
realities and increased demand for accountability for results.  GAO's
1996 symposium involving leading academics and practitioners in the
area of international affairs evidenced the broad and significant
changes that are taking place in the world in terms of governance,
finance, economics, and political-military affairs.  I will establish
the context for my statement and provide an overview of six
categories into which we have placed the international affairs
programs.  Then I will outline a framework for assessing these
activities and their funding.  And finally, I will discuss some of
the critical issues and questions that should be examined in each of
our six categories. 


   SUMMARY
---------------------------------------------------------- Chapter 0:1

It has become almost a clichï¿½ to talk about the end of the Cold War
and its impact on U.S.  foreign policy objectives, goals, and
priorities.  Clearly, this watershed event and its aftermath have
changed the nature of U.S.  international interests and priorities. 
We now face the challenges involved in North Atlantic Treaty
Organization (NATO) expansion, assisting the transition of former
Communist countries, integrating China into the world economic
system, reforming the United Nations and the World Bank, building a
credible World Trade Organization, and attacking the menace of
illegal drugs and AIDS.  These events necessitate a careful
rethinking of the programs, approaches, and activities at the U.S. 
government's disposal to advance its interests.  Post-Cold War
complexities make such a task extremely difficult, particularly in
view of the transnational, and seemingly intractable, nature of some
of the present challenges.  At the same time, the current environment
also affords the chance to reassess programs and activities on their
merits and determine if they are relevant in today's world. 

Funding in the 150 account, which totaled $18.1 billion\1 in fiscal
year 1997, constitutes only 1 percent of the federal budget and just
3 to 4 percent of discretionary funding.  Nonetheless, these
expenditures fund activities that are designed to influence world
political and economic agendas.  To support its interests in such
agendas, the U.S.  government maintains a worldwide infrastructure of
embassies, missions, consulates, and trade offices, with an overseas
staff of more than 35,000.  The 150 account funds a wide range of
programs and activities--upwards of 70 separate line items ranging
from food aid to antiterrorism assistance, to U.S.  contributions to
multilateral financial institutions, to financing by the U.S. 
Export-Import Bank (Eximbank).  A large percentage of funds in the
account is directed by the Congress or the President for specific
countries and purposes, such as child survival and population
programs. 


--------------------
\1 Dollar figures cited in this statement represent Office of
Management and Budget (OMB) budget authority data in fiscal year 1997
dollars, unless otherwise noted. 


      OVERVIEW OF INTERNATIONAL
      AFFAIRS PROGRAMS AND FUNDING
-------------------------------------------------------- Chapter 0:1.1

To facilitate the examination of 150 account funding, we have grouped
these various programs and activities into six categories (see fig. 
1). 

   Figure 1:  Distribution of 150
   Account Funding for
   International Affairs Programs,
   Fiscal Years 1992-97

   (See figure in printed
   edition.)

  -- Security and peacekeeping operations.  This category includes
     funds to support international peacekeeping efforts, foreign
     military financing, and budget and economic assistance to
     countries critical to U.S.  political and security objectives.\2

Between fiscal year 1992 and 1997, this component has represented 33
percent of total 150 account funding.\3 Funding for security and
peacekeeping has decreased in real terms by an average of about 6
percent per year to its 1997 level of $6.3 billion. 

  -- Bilateral assistance.  This category includes development
     assistance, assistance to economies in transition, humanitarian
     aid, and the operating expenses of the U.S.  Agency for
     International Development (USAID).  During the last 5 years,
     this component has represented about 30 percent of total 150
     account funding.  Funding for bilateral assistance has decreased
     in real terms by an average of about 6 percent per year to its
     1997 level of $5.2 billion. 

  -- Foreign affairs management.  This category essentially funds the
     domestic and overseas operations of the State Department for
     conducting foreign relations, including coordinating and
     supporting various U.S.  programs and activities overseas.  The
     State Department is the U.S.  government's overseas landlord,
     providing space, equipment, and communications for most agencies
     operating abroad, including the growing cadre of nondiplomatic
     staff.  Over the past 5 years, the Foreign Affairs Management
     component has represented almost 14 percent of total 150 account
     funding.  Funding for foreign affairs management has decreased
     in real terms by an average of about 4 percent per year to its
     1997 level of $2.6 billion. 

  -- Public diplomacy.  This category comprises the domestic and
     overseas operations and cultural and educational exchange
     programs of the U.S.  Information Agency (USIA).  The USIA's
     mission is to explain and advocate U.S.  policy to foreign
     publics, provide them with information about the United States,
     and advise U.S.  decisionmakers on foreign public opinion and
     its implications for the United States.  During the last 5
     years, this component has represented about 6 percent of total
     150 account funding.  Funding for public diplomacy has decreased
     in real terms by an average of about 6 percent per year to its
     1997 level of $1.1 billion. 

  -- Multilateral assistance.  This category consists of funding for
     the U.N.  agencies and for multilateral financial institutions
     such as the World Bank.  During the last 5 years, this component
     has represented almost 14 percent of total 150 account funding. 
     Funding to support U.S.  participation in multilateral
     institutions has decreased in real terms by an average of about
     6 percent per year to its 1997 level of $2.2 billion. 

  -- Trade and investment.  This category principally includes the
     activities of the Overseas Private Investment Corporation
     (OPIC), the Eximbank, and the Trade Development Agency.  This
     component has represented almost
     4 percent of total 150 account funding during the last 5 years. 
     Funding for trade and investment has decreased in real terms by
     an average of
     4 percent per year to its 1997 level of about $700 million. 

Between fiscal year 1992 and 1997, funding for the international
affairs account has declined in real terms an average of about 6
percent annually.  Funding in fiscal year 1997 was about $18.1
billion--23 percent lower than it was in 1992 (see fig.  2).  Under
the recently concluded budget agreement, international affairs
funding was designated a priority and set at a level of $19 billion
for fiscal year 1998 (excluding payment of U.S.  arrears to the
United Nations and other multilateral organizations and development
banks).\4 The 150 account is slated to experience cuts of over 13
percent in real terms by the year 2002. 

   Figure 2:  Trends in 150
   Account Funding for
   International Affairs Programs,
   Fiscal Years 1992-97 (1997
   dollars in millions)

   (See figure in printed
   edition.)

A large portion of the funds in the international affairs account
supports foreign policy and national security imperatives, which
limits budget options.  Of the $19.5 billion\5 the executive branch
sought in fiscal
year 1998, fully one-third, or $6.4 billion, is devoted to supporting
international security objectives, including security assistance to
Egypt and Israel and U.S.  peacekeeping contributions. 

One of the more significant developments in the U.S.  foreign aid
program is the participation of new recipients--the countries of
Eastern Europe and the former Soviet Union.  Aid to these countries
accounts for
18 percent of all assistance since 1992 and is consuming a greater
share of a decreasing aid pie--from 8 percent of bilateral assistance
in 1992 to
20 percent in 1997.  Aid for these countries includes grants for
training and technical assistance to facilitate development of
democratic institutions and market economies.  Assistance to Bosnia
is now the single largest program of U.S.  aid in this region--$240
million in fiscal year 1997.  Of course, this does not include $2.5
billion in incremental costs for military-related operations. 

Another noteworthy observation, we believe, is the amount of aid that
has gone to alleviate problems associated with localized
conflicts--"hot spots" such as Somalia, Bosnia, and Haiti.  Since
1993, more than $1 billion has been spent on such conflicts,
including funds for humanitarian assistance and food aid.  Typically,
USAID has been required to meet part of these requirements by
shifting funds from other ongoing bilateral assistance programs. 

Only a portion of total international affairs activities is funded
through the 150 account.  We have identified at least $7.6 billion
outside the 150 account that seem to support internationally related
initiatives and programs.  Appendix I of this testimony contains a
list of these activities and their funding levels.  Neither the
activities of the Commerce Department's International Trade
Administration, including its overseas offices, nor the Foreign
Agricultural Service's trade promotion programs and overseas offices,
nor the Defense Department's security-related assistance programs in
former Communist countries are funded under the 150 account.  These
are just a few of the more visible activities I can mention.  Coming
to an accurate understanding of just how much money goes to
international activities outside the 150 account is difficult because
of (1) the absence of broadly accepted criteria about what
constitutes a foreign affairs program or activity; (2) the lack of
transparency over the full range of international affairs-related
activities and programs managed by U.S.  government agencies--that
is, budget line item descriptions do not clearly link to
international programs or activities; and (3) the interrelatedness of
domestic and international activities.  As I discuss funding for
specific categories of the 150 account later in this statement, I
will, where possible, also highlight examples of complementary
funding outside the 150 account. 


--------------------
\2 This assistance is provided through the Economic Support Fund. 

\3 Throughout this statement, the term "funding" refers to
discretionary budget authority. 

\4 See H.R.  Conf.  Rep.  105-116, at 58 (1997) for 150 account
discretionary totals (fiscal
years 1997-2002) in 1998 Budget Resolution. 

\5 This excludes $3.5 billion in requested budget authority for the
International Monetary Fund's New Arrangements to Borrow, an activity
that does not result in an outlay of U.S.  funds or increase the
deficit. 


      HOW TO ASSESS INTERNATIONAL
      PROGRAMS AND FUNDING
-------------------------------------------------------- Chapter 0:1.2

In assessing 150 account activities, I would like to suggest using
the following analytical framework or series of questions:  First,
how relevant are current programs and activities in today's world? 
Second, how high a priority do they deserve?  And third, can those
that meet these first two tests be done more efficiently and
effectively? 

By relevance, I mean whether there have been changes in the
underlying assumptions or conditions that led to funding a program in
the first place.  If a program does meet the relevance test, the
Congress and the President must also question how important it is
relative to other programs from a cost/benefit standpoint.  Finally,
the efficiency questions:  Can program goals be achieved more
efficiently by taking advantage of technology improvements or best
practices? 

The 150 account covers a wide range of activities.  Because the range
is so broad, it is important that a regular reexamination of the
results of each program occurs to assess whether the program is
successful.  None of this is easy.  The Government Performance and
Results Act process, with its emphasis on setting priorities and
measuring outcomes, should help in this regard.\6

GAO has completed a broad range of work related to efficiency and
effectiveness of international programs.  This work, as well as
recent studies by other well-respected organizations, has identified
opportunities to reengineer foreign affairs structures and functions
to eliminate overlap and duplication and to bring them in line with
best practices.  For example, a recent, widely distributed Council on
Foreign Relations/Brookings Institution study, which recommended
additional funding for foreign affairs, also suggested that over $1
billion could be saved through such efforts. 

The Congress and the executive branch are best suited to address the
issues of relevance and priority I have raised.  The suggested
framework, I believe, is an appropriate starting point. 


--------------------
\6 The Government Performance and Results Act of 1993, also know as
the Results Act or GPRA, is the primary legislative framework through
which agencies will be required to set strategic goals, measure
performance, and report on the degree to which goals were met.  The
act requires agencies to eventually develop and submit strategic
plans, annual performance plans, and annual reports on program
performance. 


   CRITICAL ISSUES AND QUESTIONS
---------------------------------------------------------- Chapter 0:2

With this framework in mind, I will now return to the six categories
of the foreign affairs budget that I established earlier.  I will
note funding levels and trends for activities in each category and
then discuss the particular set of issues and questions that could be
raised with respect to relevance, priority, and efficiency. 


      SECURITY AND PEACEKEEPING
      OPERATIONS
-------------------------------------------------------- Chapter 0:2.1

Security and peacekeeping activities represented 33 percent of the
international affairs' fiscal years 1992-97 budget--the single
largest component of this account.  Foreign military financing
programs\7 consumed the largest portion of this component--about 50
percent--followed by about 37 percent for economic support provided
primarily to Israel and Egypt (Economic Support Fund); about 9
percent for multilateral peacekeeping operations; and about 3 percent
for programs to provide training and equipment to foreign governments
to combat crime, illegal narcotics, terrorism, and nuclear
proliferation\8 (see fig.  3). 

   Figure 3:  Distribution of
   Security and Peacekeeping
   Funding, Fiscal Years 1992-97

   (See figure in printed
   edition.)

Note:  Totals may not add due to rounding. 

Funding for the security and peacekeeping component of the
international affairs budget has declined in real terms an average of
about 6 percent during fiscal years 1992-97.  The funding level for
fiscal year 1997 of $6.3 billion is almost 30 percent lower than in
fiscal year 1992 (see fig.  4), with the most significant reductions
occurring in the Economic Support Fund.  This fund has been cut by
over 33 percent, while foreign military financing programs have
shrunk by about 26 percent.  Funding levels for assistance to Israel
and Egypt, the largest recipients, have remained relatively constant
during this period.  The executive branch has proposed a further real
decrease of about 1 percent in funding for this component in fiscal
year 1998. 

   Figure 4:  Trends in Security
   and Peacekeeping Funding,
   Fiscal Years 1992-97 (1997
   dollars in millions)

   (See figure in printed
   edition.)

Trends in funding for this category have reflected shifting U.S. 
priorities to some extent, but a large core of this component serves
fundamental security interests that have not changed significantly in
many years. 

  -- Are there opportunities to reduce security-related costs? 

As of fiscal year 1997, support for long-standing commitments to
achieve lasting peace in the Middle East through financial assistance
to Israel and Egypt represents 85 percent of the security-related
costs.  This includes Economic Support Fund grants and foreign
military financing.  The Economic Support Fund was established to
allow the United States to promote economic and political stability
in areas where the United States has special security interests.  It
has been justified to the Congress on the basis of its role in (1)
strengthening the security of friendly and allied countries and (2)
benefiting the U.S.  economy because funds are generally spent on
U.S.  goods, services, and training.  Since 1992, the Economic
Support Fund has been reduced by about one-third, with aid to
countries outside of the Middle East absorbing nearly all of these
cuts.  Decreases in foreign military financing to specific countries
outside the Middle East have resulted from the end of the Cold War
and the decline in regional conflicts, primarily in Central America. 
Currently, the vast majority of foreign military financing is devoted
to Israel and Egypt, with most of the remainder supporting partners
in Central and Eastern Europe and the Newly Independent States (NIS)
of the former Soviet Union,\9 Greece, and Turkey.  Further cuts in
these security-related components of the budget would appear to be
difficult without a major change to the U.S.  policies supporting the
Middle East peace process and European security. 

  -- Are there opportunities to reduce peacekeeping costs? 

The United States currently contributes 25 percent of the costs of
U.N.  peacekeeping operations and also supports, on a voluntary
basis, peacekeeping activities by other multinational organizations
in Africa, Latin America and the Caribbean, Europe, and the Middle
East. 

Considerable attention has been focused on the cost and effectiveness
of high-profile U.N.  peacekeeping operations such as those in
Bosnia, Haiti, and Somalia.  Less attention has been devoted to the
costs and effectiveness of long-standing but less visible U.N.  peace
missions, such as those in India/Pakistan, Cyprus, and Angola.  These
eight long-standing missions cost the United States about $148
million annually, have been in existence from 6 to nearly 50 years,
and so far have cost over $6 billion.  They have evolved into
open-ended commitments; diplomatic efforts to resolve the underlying
conflicts have stalled in nearly all of the operations, and the
situations have proven intractable.  We recently recommended that the
Secretary of State develop plans and strategies to bring these
missions to closure.\10 I want to emphasize that we do not mean these
missions should be ended immediately, but rather that concrete
actions to address the underlying conflicts should be developed. 
Success along these lines could have budgetary implications, given
the cost of these operations. 

Funding in the 150 account by no means represents the sum total of
U.S.  contributions to peacekeeping activities or U.S.  support for
international security interests.  From fiscal year 1992 to 1995,
U.S.  government agencies spent over $6.6 billion to support U.N. 
peace operations in Haiti, the former Yugoslavia, Rwanda, and
Somalia; this figure includes $3.4 billion in incremental costs
incurred by the Department of Defense and funded outside of the 150
account. 


--------------------
\7 These programs provide grants, loans, and loan guaranties to
foreign governments to purchase U.S.  military equipment. 

\8 Totals may not add due to rounding. 

\9 Significant security-related assistance being provided to the
countries of Central and Eastern Europe and the former Soviet Union
is not included in the international affairs programs account.  For
example, much of the U.S.  funding for the Partnership for Peace
program is included in the Department of Defense budget request. 
Defense has programmed at least $160 million to help former Soviet
republics or former members of the now-defunct Warsaw Pact, including
funding for development of regional air traffic control systems,
support for joint military exercises, and exchanges of information
concerning methodologies to manage defense resources.  Defense has
also programmed about $1.9 billion to help Russia, Ukraine, Belarus,
and Kazakstan reduce and control weapons of mass destruction under
the Cooperative Threat Reduction Program, generally referred to as
the Nunn-Lugar program. 

\10 U.N.  Peacekeeping:  Status of Long-standing Operations and U.S. 
Interests in Supporting Them (GAO/NSIAD-97-59, Apr.  9, 1997). 


      BILATERAL ASSISTANCE
-------------------------------------------------------- Chapter 0:2.2

Between fiscal year 1992 and 1997, about 30 percent of the
international affairs budget was spent on bilateral assistance
programs.  During this period

  -- about 37 percent supported traditional development programs
     administered primarily by USAID;

  -- about 21 percent funded food aid programs;

  -- about 18 percent was allocated for aid to Eastern Europe and the
     NIS;

  -- about 15 percent went for humanitarian aid, such as disaster
     relief; and

  -- about 9 percent funded USAID's administrative costs (see fig. 
     5). 

   Figure 5:  Distribution of
   Bilateral Assistance Funding,
   Fiscal Years 1992-97

   (See figure in printed
   edition.)

Note:  Totals may not add due to rounding. 

Funding for the bilateral assistance component has declined in real
terms an average of 6 percent per year during fiscal years 1992-97
(see fig.  6).  It peaked in fiscal year 1993, but by fiscal year
1997 had returned to about $5.2 billion--a level 17 percent lower
than in fiscal year 1992.  The President has requested an increase of
about 5 percent in funding for this component for fiscal year 1998. 

   Figure 6:  Trends in Bilateral
   Assistance Funding, Fiscal
   Years 1992-97 (1997 dollars in
   millions)

   (See figure in printed
   edition.)

One of the more significant developments in the U.S.  foreign aid
program is the participation of new recipients--the countries of
Eastern Europe and the former Soviet Union.  Aid to these countries
accounts for
18 percent of all assistance since 1992 and is consuming a greater
share of a decreasing aid pie--from 8 percent of bilateral assistance
in 1992 to
20 percent in 1997.  Aid for these countries includes grants for
training and technical assistance to facilitate development of
democratic institutions and market economies.  Assistance to Bosnia
is now the single largest program of U.S.  aid in this region--about
$240 million in fiscal year 1997. 

Also of note is the amount of aid that has gone to alleviate problems
associated with localized conflicts--"hot spots" such as Somalia,
Bosnia, and Haiti.  Since 1993, more than $1 billion has been spent
on these three conflicts, including funds for humanitarian assistance
and food aid.  Typically, USAID has had to meet part of these
requirements by shifting funds from other ongoing bilateral
assistance programs. 

The one-third of bilateral assistance that supports sustainable
development efforts includes programs in health and population
growth, economic growth and agricultural development, democracy,
education and training, and the environment.  As I said earlier, a
large percentage of sustainable development funding is directed by
the Congress or the President for specific purposes, such as child
survival and population programs.  In 1997, about 70 percent of
sustainable development assistance was earmarked or directed in this
way, up from about 60 percent in 1995. 

The central issues surrounding bilateral assistance are, first,
whether economic development assistance either has had or can have a
positive impact on development and, second, how efficiently and
effectively can aid be delivered. 

  -- How relevant are our foreign aid programs in the current
     environment? 

Despite USAID's attempt to better target its assistance, fundamental
questions remain about the effectiveness and relevance of U.S. 
development assistance for purposes other than humanitarian relief. 
Critics of foreign aid point to the end of Cold War imperatives, the
absence of conclusive evidence that aid makes a difference to
countries' economic progress, the shift to a new development model
that relies more on the private sector, and the rapid growth in the
flow of private capital to the developing world as reasons to end
traditional foreign aid.  Proponents stress the large number of
outstanding needs and the value of assistance to achieve certain
foreign policy objectives; they generally call for reform and
revitalization--not elimination. 

Our work on USAID's Housing Guaranty Program\11 highlights the
complexities in assisting development by using foreign aid.  This
program, in place for over 30 years, has guaranteed about $5 billion
in loans to developing countries with the goal of stimulating
increased private sector investment in housing for the poor.  The
program's original premise, however, did not adequately take into
account the real world limitations to achieving this objective.  In
fact, it was not clear at the time of our work that USAID was even
pursuing the original goal anymore, but rather had established new
ones throughout the years in the face of a lack of demonstrated
progress in meeting program goals.  Based on GAO's work, the Congress
has dramatically reduced funding for this program. 

A consensus is emerging, however, regarding what seems to work and
what does not.  Recent examinations by respected institutions have
concluded that the impact of economic assistance is modest and
possible only in countries with good fiscal, monetary, and trade
policies and effective governing institutions. 

  -- Have clear priorities been established for foreign assistance
     programs? 

In its 1997 strategic plan, developed in accordance with the
Government Performance and Results Act, USAID appears to have
established as a priority the importance of influencing domestic
policy in the recipient countries.  Many of the strategies it has
described for achieving its major development goals involve
persuading recipient countries to reform their economic, judicial,
health care, and education policies and regulations. 

While USAID has attempted to incorporate consideration of whether a
recipient country has changed its policy environment into the process
of deciding how much further aid to give to that country, the quality
of a country's reform efforts is not yet a guiding factor in this
process.  Our analysis of USAID resource allocations for fiscal year
1996 does not show any significant difference between the proportion
of aid allocated between the top performing countries in policy
reform and the poorer performing countries.  USAID acknowledges that
political and foreign policy considerations continue to strongly
influence USAID's budgeting process.  Allocating foreign aid based
only on policy performance would limit flexibility and would require
consensus--which would be very difficult to achieve--that aid is only
for the purposes of economic development and not for achieving other
foreign policy objectives. 

The next critical question that needs to be asked in this regard is
whether USAID can continue to operate and be effective in a large
number of countries, given the diminishing amount of foreign aid
funds available.  Despite having closed missions in 24 countries
since 1993, USAID still has programs in over 80 countries.  Many of
these countries have relatively small programs.  For example, in
fiscal year 1996, 10 countries received over 50 percent of all
sustainable development assistance allocated to specific countries,
with the remainder spread among 42 countries.  In about half of these
42 countries, the United States is a relatively minor donor, not even
among the top three bilateral aid donors.  USAID has made some
efforts to "graduate" its more successful aid recipients.  Indeed, it
has discontinued programs in some countries, such as Chile and
Thailand, whose level of development no longer justifies foreign aid. 
However, USAID has not established formal criteria for determining
which countries should continue to receive development assistance. 

  -- Can we deliver foreign assistance at lower cost? 

Despite the domestic skepticism attached to U.S.  foreign aid in
general, there still remains broad support for some specific
programs--child survival and population programs are only two
examples.  For those programs that the U.S.  government continues to
support--and that meet the tests of relevance and priority--the next
two questions should be (1) how can they be delivered most
efficiently and (2) what level of accountability are we going to
insist upon? 

Four years of reform under the leadership of the USAID Administrator
have resulted in a smaller, more streamlined aid bureaucracy that has
achieved some operational efficiencies.  USAID reengineering efforts
have included reorganizing missions and eliminating unnecessary
administrative requirements.  USAID has also sought to focus its
activities on a more manageable set of strategic objectives.  This
process has been further refined in USAID's strategic plan. 

Nevertheless, some continue to question the USAID structure in light
of the declining levels of U.S.  aid and have suggested that other
ways of delivering bilateral assistance should be considered.  The
ratio of USAID's operating expenses--about $500 million--to the costs
of the programs it administers--about $4.9 billion--has been steadily
increasing, with more USAID dollars going to manage a smaller aid
program.  One of the many options that have been discussed is the
re-creation of USAID as a foundation--providing aid through
nongovernmental organizations and without the hands-on implementation
responsibilities and attendant infrastructure it now has.  Of course
it is not clear what implications the planned consolidation of some
USAID and State Department administrative functions will have on
USAID's operating expenses.  The trade-off of this approach, of
course, is the risk of misuse of U.S.  aid dollars and a loss of
accountability for program results, as well as perhaps more limited
opportunities to use U.S.  assistance to support new or emerging
foreign policy objectives. 


--------------------
\11 See Foreign Housing Guaranty Program:  Financial Condition Is
Poor and Goals Are Not Achieved (GAO/NSIAD-95-108, June 2, 1995). 


      FOREIGN AFFAIRS MANAGEMENT
-------------------------------------------------------- Chapter 0:2.3

In recent years, about 14 percent of the international affairs budget
has been spent to fund activities related to the management of
foreign affairs.  Nearly all of this funding goes to support State
Department operations (see fig.  7), including its headquarters,
passport offices and other domestic offices across the United States,
over 250 embassies and consulates overseas, and salaries for roughly
23,000 direct-hire employees worldwide.  The remainder--about 3
percent--supports the Arms Control and Disarmament Agency (ACDA) and
a variety of commissions and funds. 

   Figure 7:  Distribution of
   Foreign Affairs Management
   Funding, Fiscal Years 1992-97

   (See figure in printed
   edition.)

Funding appropriated to State for foreign affairs management has
declined in real terms by an average of 4 percent per year during
fiscal
years 1992-97 (see fig.  8).  The fiscal year 1997 funding level of
$2.8 billion was about 15 percent lower than in fiscal year 1992. 
This decline has been ameliorated somewhat by visa fees that State
has been allowed to retain since fiscal year 1995 to offset the cost
of its operations--averaging about $140 million per year.\12 The
administration has requested a 4.9 percent real increase in
appropriations for foreign affairs management in 1998.  Under the
Illegal Immigration Reform and Immigrant Responsibility Act of 1996,
State's work load will increase starting in April 1998.  State will
assume responsibility for adjudicating all applications for border
crossing cards for Mexican nonresident aliens entering the United
States, a responsibility it had previously shared with the
Immigration and Naturalization Service.  State estimates that it will
need about 70 additional employees to handle the increased workload. 

   Figure 8:  Trends in Foreign
   Affairs Management Funding,
   Fiscal Years 1992-97 (1997
   dollars in millions)

   (See figure in printed
   edition.)

Over the last several years, State has closed 30 overseas posts,
reduced the general work force by about 2,200 positions, lowered
overseas allowances, and cut operating budgets.  A recent joint
Brookings Institution/Council on Foreign Relations study concluded
that State's ability to function effectively has been eroded, citing
the existence of shabby, unsafe, and ill-equipped posts; obsolete
information technology; and uneven staffing. 

At the same time, GAO and others have raised concerns about the
relevance and priority of some of State's activities and the
efficiency with which it operates.  Although the State Department has
reduced staff and implemented some cost reduction measures, it has
not undertaken a fundamental rethinking of its foreign affairs and
diplomatic structure or significantly changed its business practices. 
This would involve reassessing the rationale for the current overseas
structure and staffing, reviewing both the approach and the level of
State's involvement in some functions and activities, and adopting
better business practices. 

Thus, some tough questions need to be asked: 

  -- Does the United States need and can it afford all overseas posts
     as currently staffed and structured? 

Given the cost of our overseas infrastructure, the Congress and the
President need to make sure that State's post and staff structure is
consistent with current U.S.  foreign policy needs and that it makes
the best use of U.S.  resources and staff.  About $2 billion, or over
80 percent, of the amount spent on the administration of foreign
affairs is tied to the operation of overseas posts.  The current
structure is based on State's policy of universality--a diplomatic
presence in almost every country of the world, even those that by
State's own admission are not critical to U.S.  interests.  The costs
of a U.S.  overseas presence vary widely.  For example, in 1995 the
post in Western Samoa cost $2.5 million to operate and the U.S. 
mission in Germany cost over $90 million. 

Changing U.S.  interests--and the mutable nature of the world
problems the U.S.  government faces--mean that we need to scrutinize
U.S.  presence and staffing on a mission-by-mission basis.  Closing
posts would meet opposition from various interests groups, and the
savings from the closure of small individual posts would not be
substantial.  Greater regionalization of the U.S.  diplomatic
presence by having one ambassador accredited to serve in multiple
countries is an option that could be explored to increase efficiency
and lower costs.  Taking advantage of modern telecommunications
technology may make it feasible for State to consolidate a limited
number of overseas posts.  For example, the U.S.  embassy in
Bridgetown, Barbados, has full diplomatic responsibilities for
7 countries and partial diplomatic responsibility for 14 others in
the eastern Caribbean; likewise, British ambassadors are accredited
to 3 to 4 countries each in Africa.  These could serve as models for
a U.S.  diplomatic reorganization in other regions beyond the
Caribbean.  We calculated that if State closed 20 small embassies and
employed the above approach, State could reduce its costs by up to
$40 million annually, after closing costs were paid and U.S. 
direct-hire positions were eliminated. 

  -- Can the State Department operate more efficiently? 

The State Department is entering the 21st century with outdated and
costly-to-maintain communications systems and weak and outdated
management processes.  State has not made the necessary investments
to modernize its information technology and is only now beginning a
serious attempt to improve its capabilities in this area.  The
success of those efforts is critical to achieving long-term savings
in information management costs and to streamlining its business
practices. 

Our work has shown that State's business processes could be made more
cost-effective.  Just this month we reported\13 that the introduction
of prevailing best management practices from the private sector into
State's staff relocation process could save millions. 

We have previously identified weaknesses in State's management of its
overseas real estate portfolio and recommended a panel to review
properties.  At the Congress' direction, State has established such a
panel, including real estate experts from outside the Department. 
The panel has begun its work, recommending properties for sale as
well as those where local conditions preclude a sale at fair price to
the U.S.  government.  The Congressional Budget Office estimated that
State could generate $150 million over the next 5 years by selling
100 properties that it has identified for potential sale.  According
to State, last fiscal year the Department executed final sales of
over $60 million worth of properties and reinvested those proceeds in
needed facilities, which will also reduce future rental costs. 

  -- Is State efficiently structured, and are all of State's
     functions and activities needed? 

Our work suggests that the answer to the first part of this question
is "no," and the answer to the second is "not clear." State maintains
a headquarters with 6 geographic and 15 functional bureaus, including
a bureau for international organizations.  Some programs and
administrative functions overlap between geographic and functional
bureaus.  For example, although State has a functional bureau with
responsibility for political-military issues, it also has 24
political-military positions in other bureaus, including each
geographic bureau.  In a way, the geographic bureaus operate as six
micro-State Departments.  Add to this mix the work and policy
interests of the bureau dedicated to working with international
organizations, and you have a complicated structure in which to
develop policy. 

In addition to overlap within its own structure, State has bureaus,
offices, and activities that mirror those of many other parts of the
federal government, including agencies with primary responsibility
for trade, agriculture, labor, and environmental issues.  While State
has a critical role in advancing U.S.  interests in these
increasingly international issues, it is not clear if the current
approach and level of staffing to support its involvement are
necessary. 

As an illustration, although the Department of Labor is the lead U.S. 
representative in multilateral forums on labor issues, several State
bureaus address these issues.  To support work on labor issues, the
State Department has 45 labor attachï¿½s overseas that gather detailed
information on workers' rights outside the United States and prepare
congressionally required reports.  Work we completed in 1996\14
suggests that the 45 attachï¿½ positions and their corresponding
headquarters complement may not be necessary because, according to
several officials at overseas posts, labor issues could be adequately
covered by the State Department's political and/or economic officers
as they are in countries without attachï¿½s.  The Congressional Budget
Office estimated that eliminating these positions through attrition
over 5 years would produce savings of $30 million.  State has
proposed abolishing or lowering the rank of some labor attachï¿½
positions in the past but has encountered resistance from the
Department of Labor and organized labor. 

There seems to be room to rethink State's involvement in such
functions or at least its approach.  The process specified in the
Government Performance and Results Act is a good vehicle to address
this issue by encouraging government agencies to improve coordination
of cross-cutting functions.\15 However, we have examined the State
Department's strategic plan and noted, among other concerns, that
State does not clearly indicate how it plans to provide leadership
and coordinate the programs of other agencies.  In some cases,
changing State's involvement may require congressional approval or
interagency agreement. 

The problems with State's organizational structure are widely
recognized within the Department, and the Secretary of State has
expressed her commitment to crafting a Department that functions
better, faster, and more flexibly as she consolidates State, USIA,
and ACDA.  To accomplish this, the Secretary has established 15
employee task forces to examine all aspects of State's operations
with the goal of reducing potential overlap and improving the
agency's decision-making process.  According to a member of State's
Reorganization Secretariat, the objective of the consolidation is to
let the State Department spend less time negotiating with itself and
more time engaged with foreign governments. 

  -- How well is the consolidation of foreign affairs agencies being
     managed? 

The April 1997 decision to consolidate the State Department, the
USIA, and the ACDA and to integrate certain administrative functions
of State and USAID presents a major management challenge, but it also
creates an opportunity to achieve cost savings.  Among the more
straightforward tasks will be consolidating the organizations'
similar administrative functions, such as travel and payroll. 
However, the consolidation also offers State a major opportunity to
address potential overlaps and duplication not only in the areas of
public diplomacy and arms control but also in all of the Department's
activities and functions.  Creativity will be needed to find a way of
incorporating these functions into State's organization without
taking the traditional approach of establishing positions for public
diplomacy and arms control positions within both the functional and
regional bureaus.  If managed carefully and creatively, the
consolidation should produce efficiencies and cost reductions over
the long term. 


--------------------
\12 When these funds are included, the real average annual decline is
about 3 percent, and the real funding level in fiscal year 1997 was
10 percent lower than in fiscal year 1992. 

\13 See State Department:  Using Best Practices to Relocate Employees
Could Reduce Costs and Improve Service (GAO/NSIAD-98-19, Oct.  17,
1997). 

\14 See State Department:  Options for Addressing Possible Budget
Reductions (GAO/NSIAD-96-124,
Aug.  29, 1996). 

\15 See Managing for Results:  Using the Results Act to Address
Mission Fragmentation and Program Overlap (GAO/AIMD-97-146, Aug.  29,
1997). 


      PUBLIC DIPLOMACY
-------------------------------------------------------- Chapter 0:2.4

Let me turn now to the public diplomacy category--essentially the
programs and activities of the USIA--which represents about 6 percent
of the funding for international affairs programs.  USIA salaries and
expenses account for the bulk of public diplomacy funding; in fiscal
years 1992-97, 40 percent was allocated for USIA personnel and
operations at over 200 overseas locations and headquarters; about 38
percent for international broadcasting operations including the Voice
of America; and about 22 percent for exchange programs such as
Fulbright scholarships (see
fig.  9). 

   Figure 9:  Distribution of
   Public Diplomacy Funding,
   Fiscal Years 1992-1997

   (See figure in printed
   edition.)

Funding for public diplomacy has declined in real terms an average of
about 6 percent annually during fiscal years 1992-97 (see fig.  10). 
Funding peaked in fiscal year 1994 due primarily to increased funding
for educational and cultural exchange programs for the NIS and has
declined since.  The fiscal year 1997 funding level of $1.1 billion
was 25 percent lower than it was in fiscal year 1992.  The largest
decrease, between fiscal year 1995 and 1996, resulted from reductions
in funding for exchanges, salaries, and expenses and the
consolidation of international broadcasting activities.  The
executive branch has proposed a further 3.5 percent real decrease in
funding for public diplomacy for fiscal year 1998.  Over the years,
the USIA's programs have shifted in emphasis from one part of the
world to another in response to foreign policy initiatives and
direction from the executive branch as well as to congressional
mandates. 

   Figure 10:  Trends in Public
   Diplomacy Funding, Fiscal Years
   1992-1997 (1997 dollars in
   millions)

   (See figure in printed
   edition.)

Even before the announcement of its consolidation with the State
Department, the USIA had cut staff, consolidated all nonmilitary
international broadcasting, and developed a strategy to downsize its
operations and reduce costs.  However, difficult questions about the
continuing relevance of some public diplomacy programs remain.  Many
USIA programs and the agency's overseas structure and infrastructure
were established after World War II as the United States sought to
counter the Soviet bloc and encourage the development of democracy. 
Legislative requirements have earmarked much of the USIA's budget for
specific exchanges, broadcasting programs, and grantees.  More
radical changes in USIA activities and programs would be needed to
generate significant additional cost reductions and would require the
Congress to revisit some of these legislative requirements.  They
would also require the USIA and the State Department to change their
traditional operating philosophy that the USIA should be located
wherever the State Department has a presence. 

Regarding public diplomacy funding, the key questions are whether we
can continue to fund all USIA facilities abroad and whether we can
achieve greater efficiencies in USIA broadcasting. 

  -- Do we need and can we afford all USIA facilities overseas? 

The USIA spends about 30 percent of its budget on salaries,
infrastructure, and operating expenses for overseas
installations--many in flourishing democracies.  For example, the
USIA spent $9 million in 1995 for operations in Germany, including
six outreach centers.  The 77 staff at these centers, called "America
Houses," provide information on U.S.  policy and business and study
opportunities and host cultural events.  Much of the information the
USIA provides is also generated by the private sector, is available
electronically, and could be distributed by a private entity. 

The USIA's efforts to reform and relocate outreach centers (of which
it operates about 70) have reduced costs in some cases.  The USIA
estimated that the 1995 decision to close an America House in Germany
in favor of a local government and business-supported German/American
Cultural Center saved about a million dollars per year.  Also, in
Singapore, the USIA terminated a $455,000 yearly lease for a cultural
center and moved into embassy facilities.  While the USIA should
continue to explore such opportunities, eliminating posts altogether
in up to 67 countries that by USIA's own criteria are relatively less
important to U.S.  interests would achieve more significant cost
savings.  The traditional belief that the USIA should be located
where the State Department has a presence has made this difficult. 

  -- Are all exchange programs essential, and are they targeted to
     meet U.S.  objectives? 

The USIA manages a variety of exchange programs to foster mutual
understanding between the people of the United States and other
countries.  In 1950, shortly after the U.S.  government began funding
scholarships, it was the primary source of funding for 7.7 percent of
foreign students in the United States.  In 1994, only 1.2 percent, or
about 5,400, of the 453,000 foreign students attending U.S.  high
schools, colleges, and universities received U.S.  government funding
as their primary source of support.  During this period other federal
agencies, as well as state and local governments and the private
sector, have increased their roles in funding exchanges.  The USIA
currently accounts for only one-fourth of the funding for U.S. 
government exchange programs. 

In 1996, the USIA acknowledged that non-USIA exchange opportunities
were plentiful in some regions such as Western Europe and that
therefore it was shifting exchange resources to regions that are not
as fully represented by other U.S.  government agencies or the
private sector.  Since the end of the Cold War, the Congress has
appropriated funds to establish new exchange programs, particularly
in countries of Central and Eastern Europe and the former Soviet
Union. 

Other agencies, including the Departments of Education and Defense,
also engage in exchanges and other educational efforts with funding
outside the 150 account.  For example, the Department of Education
funds a program to help improve civics and economics education in
Central and Eastern Europe and the former Soviet Union.  I would like
to note that the House of Representatives' foreign affairs reform
bill calls for the establishment of a working group to improve the
coordination and effectiveness of U.S.  government-supported
exchanges.\16

  -- Are there opportunities to achieve further efficiencies in
     international broadcasting? 

In the U.S.  International Broadcasting Act of 1994, the Congress
reaffirmed the importance of continued U.S.  broadcasts to further
U.S.  interests.  However, the Congress has reduced funding for most
nonmilitary international broadcasting activities and mandated their
consolidation.  In 1996, the United States broadcasted over 1,600
hours of radio programming in 53 languages and over 400 hours of
television in several languages worldwide each week to support U.S. 
foreign policy objectives.  Only modest economies are possible by
eliminating overlap and lessening duplication among broadcasters. 
Achieving significant cost savings would require a major reduction in
the number of language services and broadcast hours.  However, past
experience has shown that eliminating even one language is a
difficult process, due to the interest of the Congress, the National
Security Council, and others and could impinge on the USIA's
readiness in a crisis situation. 


--------------------
\16 See Foreign Relations Authorization Act, Fiscal Years 1998 and
1999, H.R.  1757, 105th Cong.,
section 1406. 


      MULTILATERAL ASSISTANCE
-------------------------------------------------------- Chapter 0:2.5

U.S.  contributions to a variety of international organizations and
programs consumed about 14 percent of the international affairs
budget from fiscal year 1992 to 1997.  Contributions to international
organizations, including the United Nations, represented about 44
percent; about 39 percent funded our participation in the World Bank
group, primarily for concessional (below-market interest rate)
lending programs; and contributions to other international financial
institutions (including the African, Asian, and Inter-American
Development Banks and the European Bank for Reconstruction and
Development) accounted for the remaining
17 percent.  (See fig.  11.) The vast majority of funds the United
States provides to the World Bank is used to finance interest-free
loans to the poorest developing countries through the Bank's
International Development Association (IDA).  The two largest
recipients are India and China, which together received almost 30
percent of these loan funds--or $2.4 billion each--in fiscal years
1994-96.  As China continues to develop, IDA lending to that country
is being phased out and is slated to end in 1999. 

   Figure 11:  Distribution of
   Multilateral Assistance
   Funding, Fiscal Years 1992-97

   (See figure in printed
   edition.)

Funding for multilateral assistance has declined in real terms an
average of about 6 percent per year during fiscal years 1992-97, as
shown in figure 12.  Funding peaked in fiscal year 1995, with larger
than average contributions to the World Bank.  Since then,
contributions to the World Bank and other international financial
institutions and the United Nations have declined to almost $2.2
billion in fiscal year 1997--a level about
27 percent lower than in fiscal year 1992.  For fiscal year 1998, the
executive branch has requested a real increase of 32.5 percent for
multilateral assistance, largely to return annual funding of
multilateral organizations to traditional levels.\17

   Figure 12:  Trends in
   Multilateral Assistance
   Funding, Fiscal Years 1992-97
   (1997 dollars in millions)

   (See figure in printed
   edition.)

Concerning multilateral assistance, the key questions are whether
such assistance continues to serve U.S.  interests and can be
delivered more efficiently. 

  -- Are all of the multilateral organizations that we participate in
     still relevant? 

Reviewing multilateral assistance involves taking a hard look at the
continuing relevance of many international organizations and the
extent to which they serve U.S.  interests.  The State Department
believes that ongoing U.S.  membership in these organizations is
important to the United States because their activities contribute in
varied ways to U.S.  security, prosperity, health, and safety.  Our
review of the operations of several of these organizations indicates
that their policies and agendas are consistent with U.S.  national
security and foreign policy objectives and provide significant
benefits in such areas as development, global health, and scientific
research.\18

The U.S.  government participates in dozens of other international
organizations established to serve specialized but limited functions,
such as the World Road Association and the International Copper Study
Group.  The United States provided about $11 million in 1995 to
organizations that the State Department viewed as making only limited
contributions to U.S.  interests.\19 In recent years, the United
States has withdrawn from two such organizations.  State's attempt to
withdraw from at least one other organization, the International
Cotton Advisory Committee, met with congressional opposition.  A
State official told us that other attempts would likely meet the same
type of resistance. 

Support for the World Bank has been the subject of periodic
controversy in the United States.  The purpose of the World Bank is
to promote economic growth and the development of market economies by
providing finance on reasonable terms to countries that have
difficulty obtaining capital.  Critics of the Bank often cite the end
of the Cold War, the recent rapid increase in private investment in
developing countries, and weaknesses in project effectiveness and
management reforms.  In September 1996, we reported that
participation in the World Bank furthered U.S.  interests because it
generally leverages other donors' funds for programs and geographical
areas that the U.S.  government wants to support.\20

  -- Can the efficiency and effectiveness of these organizations be
     improved? 

The State Department acknowledges that some U.N.  organizations are
not operating efficiently and effectively and that some of them have
functions that overlap.  However, the organizations have begun to
address weaknesses in the management and administration of their
operations and programs that have been the subject of frequent
criticism by the Congress and others.  The United States and other
member states are continuing to call for reforms in the belief that
greater efficiency in these agencies could reduce their cost.  With
U.S.  encouragement and assistance, the United Nations has embarked
on a program of reform.  Reforms could reduce costs; however, their
fate is uncertain, and they cannot be expected to be completed
anytime soon. 

Regarding the World Bank, U.S.  interests could be better served by
the World Bank if it could improve its record of effectiveness. 
Reforms have been implemented and show some early signs of progress,
but in some areas major impediments still remain and improvements do
not seem to have taken hold.  Through its leadership, the United
States is positioned to ensure that Bank reforms continue to progress
and to have a positive impact on development effectiveness.  To this
end, we recommended that the Secretary of the Treasury monitor and
periodically report to the Congress measurable indicators of
progress, such as the extent to which the Bank allocates financing to
those countries that make Bank-advocated market and policy reforms. 


--------------------
\17 This does not include a requested advance appropriation of $921
million to clear U.S.  arrears to the United Nations and other
multilateral organizations, which, if approved, would not be
available until fiscal year 1999.  It also does not include $3.52
billion in budget authority for the International Monetary Fund's New
Arrangements to Borrow (which would not result in budget outlays). 

\18 United Nations:  U.S.  Participation in Five Affiliated
International Organizations (GAO/NSIAD-97-2, Feb.  27, 1997) and
International Organizations:  U.S.  Participation in the United
Nations Development Program (GAO/NSIAD-97-8, Apr.  17, 1997). 

\19 State Department:  U.S.  Participation in Special-Purpose
International Organizations (GAO/NSIAD-97-35, Mar.  6, 1997). 

\20 World Bank:  U.S.  Interests Supported, but Oversight Needed to
Help Ensure Improved Performance (GAO/NSIAD-96-212, Sept.  26, 1996). 


      TRADE AND INVESTMENT
-------------------------------------------------------- Chapter 0:2.6

International trade and investment funding represented about 4
percent of the international affairs budget in fiscal years 1992-97. 
Trade and investment funding supported primarily the Eximbank, the
Trade and Development Agency, and the International Trade Commission. 
(See
fig.  13).  Figure 13 excludes OPIC because it returned net revenue
to the U.S.  Treasury during this period.  Related--and
large--expenditures for trade and investment activities and programs
outside the 150 account include the activities of the Commerce
Department's International Trade Administration, the Office of the
U.S.  Trade Representative, the various agricultural trade promotion
and credit guaranty programs, and the programs of the Small Business
Administration. 

   Figure 13:  Distribution of
   Trade and Investment Funding,
   Fiscal Years 1992-97

   (See figure in printed
   edition.)

The largest increase in international trade and investment funding,
between fiscal year 1993 and 1994, was due primarily to higher
funding for programs in the NIS.  Funding has continuously declined
since reaching its highest level in 1994, with the fiscal year 1998
request representing a decrease of almost 20 percent in real terms
over the preceding year.  (See fig.  14.)

   Figure 14:  Trends in Trade and
   Investment Funding, Fiscal
   Years 1992-97 (1997 dollars in
   millions)

   (See figure in printed
   edition.)

Eximbank and OPIC programs have become increasingly controversial in
recent years, generating questions about whether they continue to be
relevant and whether government costs and taxpayer risk can be
reduced.  Both organizations provide loans, guarantees, and insurance
to support U.S.  exports or market-oriented private investment.  In
some risky markets where the Eximbank operates, some borrowers miss
payments or default on entire loans; such losses must be covered by
the Eximbank, resulting in subsidy costs to the federal government. 

  -- Are the programs of the Eximbank and OPIC relevant in today's
     environment? 

OPIC was created in 1969 to help mobilize U.S.  capital and skills
for the economic and social advancement of developing countries--a
major U.S.  foreign policy objective.  The Eximbank's creation was
spurred by the economic conditions of the 1930s, when exports were
viewed as a stimulus to economic activity and employment.  The
Congress continues to debate the relevance of export promotion and
investment programs, most recently as it considered whether to
reauthorize the Eximbank and OPIC.  The debate has centered on the
need for government support and the organizations' costs and
benefits.  Critics question whether the U.S.  government should
provide direct assistance to private exporters and investors.  They
charge that expenditures to subsidize the transactions of the
Eximbank and OPIC amount to "corporate welfare." In the case of the
Eximbank, critics claim that a substantial portion of its subsidy
expenditures and financing commitments is used to support the
operations of large exporting multinational firms that are
experienced exporters and have their own resources to export their
products.  Moreover, the economic benefits of the programs are
uncertain.  Some economists argue that the market is a much more
efficient allocator of resources than the government and that these
programs cannot produce a substantial change in employment levels. 
The nearly fivefold increase in private investment flows to the
developing world since 1990 may also raise questions concerning the
continued need for the Eximbank and OPIC, given the private sector's
growing willingness to support trade and investment transactions in
some emerging markets. 

Conversely, proponents of continued U.S.  government support argue
that there is still a niche for the Eximbank and OPIC.  Risky markets
still exist where the private sector is reluctant to operate or
invest without public financing.  Concerning the Eximbank, our recent
work indicated that although definitive evidence about the economic
impact of U.S.  government trade programs is lacking,\21 perhaps the
most compelling argument in defense of the Eximbank is its role in
helping to "level the international playing field" for U.S. 
exporters.  All major industrialized countries operate similar
programs and thus are primarily countered through U.S.  programs. 
Our recent work on OPIC suggests that, despite increasing private
capital flows to the developing world, there are still markets where
U.S.  private firms are unwilling to participate without some form of
public support, be it from OPIC, the Eximbank, foreign governments,
or multilateral organizations.\22

Turning to OPIC, historically its combined finance and insurance
programs have been self-sustaining.  OPIC's net income from
transactions with the private sector amounted to about $43 million in
fiscal year 1996.\23 During fiscal year 1996, approximately 18
percent of OPIC's financing commitments supported small businesses
and cooperatives; the remaining 82 percent supported large
businesses.  The U.S.  foreign policy objective of promoting private
investment in developing countries encourages OPIC to underwrite
risks that the private sector may not assume without public support. 
OPIC, the State Department, and other U.S.  government officials
consider OPIC to be a major tool for pursuing U.S.  foreign policy
goals, such as assisting Russia in its transition toward achieving a
free market economy. 

  -- Are there opportunities to support U.S.  exports and investments
     while reducing costs and risks? 

If legislation is enacted reauthorizing Eximbank and OPIC, the
question becomes whether there are opportunities to reduce the costs
of their programs.  The Eximbank and OPIC could undertake actions
such as better leveraging resources, decreasing portfolio risk, and
lowering costs by raising their fees, changing their portfolio mix,
or changing the structure of their transactions.  For example, work
we completed in 1996 identified two options that would allow the
Eximbank to reduce subsidies while remaining competitive with foreign
export credit agencies:  (1) raising fees for services and (2)
reducing the risks of its programs; that is, limiting program
availability in certain high-risk markets.  The Congressional Budget
Office estimated that increasing fees could save the Eximbank up to
$450 million over 5 years, and reducing program risks could save up
to $1.2 billion over 5 years.  Some progress has been made:  the
Organization for Economic Cooperation and Development, with U.S. 
leadership, has now set a minimum fee for services effective in April
1999.  This should provide the Eximbank with the opportunity to
further reduce the costs of its operations. 

Our recent work suggests that OPIC could further reduce the risk in
its portfolio, given the private sector's willingness to have greater
involvement in some emerging markets.  For instance, OPIC could lower
the risks associated with its portfolio through increased use of
reinsurance and coinsurance and by decreasing project coverage or
terms.  However, if OPIC is to continue pursuing its mission of
promoting investment in risky markets, its portfolio will always be
considered more risky than the portfolios of private sector insurers. 


--------------------
\21 We recently reported that, because of the continued expansion of
U.S.  exports, the share of exports supported by the Eximbank has
been decreasing over the years.  It fell to less than 2 percent in
1995, the lowest level of support provided by major industrial
nations' export credit agencies.  The major users of Eximbank
financing include several large, well-known firms such as Boeing,
Raytheon, General Electric, Bechtel, and Asea Brown Boveri.  During
fiscal years 1994 through 1996, these and the other top 15 users of
Eximbank financing accounted for about $14.4 billion, or 38 percent,
of the Eximbank's total export-financing commitments and about 27
percent of its total program budget, or subsidies.  Meanwhile, a
growing level of support has been directed to small business--during
fiscal years 1994 to 1996, about 20 percent of the Eximbank's total
financing commitments went to support small business.  During fiscal
years 1992 to 1996, subsidy costs averaged $750 million annually. 
See Export-Import Bank:  Key Factors in Considering Eximbank
Reauthorization (GAO/T-NSIAD-97-215, July 17, 1997) and Export-Import
Bank:  Options for Achieving Possible Budget Reductions
(GAO/NSIAD-97-7, Dec.  20, 1996). 

\22 Overseas Investment:  Issues Related to the Overseas Private
Investment Corporation's Reauthorization (GAO/NSIAD-97-230, Sept.  8,
1997). 

\23 OPIC's net income was $209 million in fiscal year 1996 when $166
million in interest earned on Treasury securities is included. 


-------------------------------------------------------- Chapter 0:2.7

Mr.  Chairman, this concludes my prepared remarks.  I would be happy
to respond to any questions you or other Committee members may have. 
See the end of this statement for a list of related products that GAO
has recently completed. 


EXAMPLES OF DISCRETIONARY
INTERNATIONAL ACTIVITIES RELATED
TO THE 150 ACCOUNT
=========================================================== Appendix I

This appendix contains two tables.  Table I.1 shows
international-related programs with identified funding.  Table I.2
shows international-related programs where specific funding is not
identified.  These tables are intended to illustrate the broad range
of activities that support U.S.  international policy objectives and
are funded outside the 150 account. 



                                    Table I.1
                     
                      International Programs With Identified
                                     Funding

                                                            FY 1998 request
Program                       International role               (millions)
----------------------------  ------------------------  ------------------------
Executive Office of the President
--------------------------------------------------------------------------------
National Security Council     Advises the President on             $7
                               the integration of
                               domestic, foreign, and
                               military policies
                               relating to national
                               security. Coordinates
                               U.S. policy issues on
                               combating terrorism for
                               federal efforts to
                               respond to terrorist
                               incidents abroad or
                               domestic incidents with
                               foreign involvement.
Office of Management and      Examines programs,                   7
 Budget: National Security     budget requests, and
 and International Affairs     management activities;
                               proposes changes; and
                               participates in
                               counterterrorism
                               efforts.
Office of the U.S. Trade      Develops, coordinates,               22
 Representative                and advises the
                               President on U.S.
                               international trade
                               policy; conducts
                               international trade
                               negotiations; and
                               conducts U.S. affairs
                               related to the World
                               Trade Organization.

Department of Agriculture
--------------------------------------------------------------------------------
Commodity Credit              Administrative expenses              4
 Corporation: Export Loans     only. Bulk of funding
 Program                       is mandatory. In order
                               to increase U.S.
                               agricultural exports,
                               the Corporation
                               guarantees payments due
                               from foreign banks and
                               buyers.
Foreign Agricultural Service  Opens, expands, and                 147
                               maintains global market
                               opportunities through
                               international trade,
                               cooperation, and
                               sustainable
                               development.
Public Law 480 Title I        Encourages export of                 90
 Program                       agricultural
                               commodities by
                               financing sales to
                               developing countries
                               and promotes foreign
                               policy by enhancing the
                               food security of
                               developing countries.
                               Through the program,
                               U.S. agricultural
                               commodities are sold to
                               developing countries on
                               long-term credit at
                               below-market interest
                               rates.

Department of Commerce
--------------------------------------------------------------------------------
Export Administration         Enforces U.S. export                 43
                               trade laws consistent
                               with national security,
                               foreign policy, and
                               short supply
                               objectives.
International Trade           Develops the export                 272
 Administration                potential of U.S. firms
                               in a manner consistent
                               with national security
                               and foreign and
                               economic policy and
                               promotes an improved
                               trade posture for U.S.
                               industry.
National Telecommunications   Serves as principal                  5
 and Information               adviser to the
 Administration                President on domestic
                               and international
                               communications policy.
                               Develops and advocates
                               U.S. interests in
                               international
                               telecommunications
                               regulation and policy
                               and helps oversee the
                               Communications
                               Satellite Corporation
                               (COMSAT), the U.S.
                               signatory to
                               international satellite
                               organizations.
Technology Administration     Serves as the focal                  9
                               point for civilian
                               technology and
                               competitiveness in the
                               administration,
                               improves U.S.
                               industrial
                               competitiveness and
                               exercises leadership as
                               the private sector's
                               advocate, participates
                               in international
                               science and technology
                               groups and agreements.

Department of Defense
--------------------------------------------------------------------------------
Defense Export Loan           Established in FY 1996               1
 Guarantee Program Account     to issue guarantees for
                               sale or long-term lease
                               of defense articles,
                               services, or design and
                               construction services
                               to a NATO member, non-
                               NATO ally, and certain
                               countries in Central
                               Europe and Asia.
Drug Interdiction and         Assists U.S. and foreign            653
 Counter-drug Activities       government law
                               enforcement agencies by
                               providing detection,
                               monitoring, and
                               tracking support;
                               intelligence support;
                               planning assistance;
                               and communications,
                               logistics, and training
                               support.
Former Soviet Union Threat    Facilitates elimination,            382
 Reduction                     transportation, and
                               storage of nuclear,
                               chemical, and other
                               weapons; establishes
                               programs to prevent
                               proliferation; and
                               trains and supports
                               defense personnel for
                               demilitarization and
                               protection of weapons.
NATO Security Investment      Acquires and constructs             176
 Program                       military facilities and
                               installations and funds
                               related expenses for
                               the collective defense
                               of the North Atlantic
                               Treaty Area.
National Security Education   Funds international-                 2
 Trust Fund                    related studies of U.S.
                               students.
On-site Inspection Agency     Supports international              109
                               arms control treaty
                               implementation,
                               including inspections
                               of foreign facilities,
                               territories, or events.
Overseas Contingency          Funds Bosnia Peace                 1,468
 Operations Transfer Fund      Operation. Assumes June
                               1998 U.S./NATO military
                               pullout.
Support of Other Nations      Provides U.S. financial             305
 (Army)                        contributions for the
                               operation of the NATO
                               international military
                               commands and
                               facilities, the NATO
                               Airborne Early Warning
                               and Control System, and
                               the Central European
                               Operating Agency
                               Pipeline System;
                               supports U.S. personnel
                               assigned to
                               international
                               organizations; funds
                               programs that further
                               Army-to-Army
                               cooperation with allied
                               and friendly nations;
                               supports Latin American
                               Cooperation activities
                               and the School of the
                               Americas; and funds the
                               Marshall Center
                               (Institute for Eurasian
                               Studies), nonsecurity
                               assistance of military
                               groups, and
                               unreimbursed costs of
                               foreign military sales
                               activities.
Overseas humanitarian,        Funds two programs:                  80
 disaster, and civic aid       general Humanitarian
                               Assistance and Foreign
                               Disaster Relief Program
                               and Humanitarian
                               Demining Program.

Department of Education
--------------------------------------------------------------------------------
International Education       Helps improve civics and             5
 Exchange                      economics education in
                               Central and Eastern
                               Europe, the former
                               Soviet Union, and the
                               United States.

Department of Energy
--------------------------------------------------------------------------------
Falcon and Amistad            Most of funds given to               1
 Hydroelectric Facilities:     International Boundary
 operation, maintenance, and   and Water Commission,
 emergency expenses.           which assists in
                               operating the
                               facilities, through a
                               reimbursable agreement
                               with EPA.
International clean coal      Introduces U.S. clean                50
 technology                    coal technology in
                               China for electricity
                               production. Electricity
                               demand in China
                               represents a
                               significant market for
                               U.S. vendors. $50
                               million available
                               October 1998.
International Nuclear Safety  Supports safety                      81
 and Security                  improvements;
                               encourages development
                               and continuation of a
                               U.S. equivalent nuclear
                               safety culture at
                               select Soviet-designed
                               reactor sites;
                               addresses safety and
                               nonproliferation
                               concerns in the former
                               Soviet Union; supports
                               closure of Chernobyl;
                               and continues efforts
                               at Argonne National
                               Laboratory regarding
                               spent fuel.
Nonproliferation and          Provides policy,                    671
 National Security             direction, technology
                               development and
                               implementation, and
                               leadership in national
                               and international
                               efforts to reduce the
                               danger to national
                               security posed by
                               weapons of mass
                               destruction.
Large Hadron Collider         Supports international               35
 Project                       agreement in physics.
                               $394 million advance
                               appropriation requested
                               for fiscal years 1999-
                               2004.

Department of Health and Human Services
--------------------------------------------------------------------------------
Fogarty International Center  Hosts symposiums,                    17
 for Advanced Study in the     organizes cooperative
 Health Sciences               research between the
                               National Institutes of
                               Health and foreign
                               scientists, provides
                               fellowships to foreign
                               scientists in the
                               United States, supports
                               foreign research by
                               U.S. fellows, and hosts
                               foreign visitors to the
                               NIH.
Refugee Resettlement          Provides assistance in              396
 Assistance                    order to help refugees
                               achieve economic self-
                               sufficiency and social
                               adjustment within the
                               shortest time possible
                               following their arrival
                               in the United States.

Department of the Interior
--------------------------------------------------------------------------------
Compact of Free Association   Funds economic                       8
                               assistance and
                               necessary expenses for
                               the Republics of the
                               Marshall Islands and
                               Palau and the Federated
                               States of Micronesia.
National Park Service -       Cooperates through                   2
 international                 training and technical
                               assistance programs
                               with foreign park
                               service and
                               conservation personnel,
                               participates in studies
                               of coastal resource
                               management, and assists
                               in protecting and
                               managing
                               internationally
                               significant sites.
North American Wetlands       Fulfills obligations                 15
                               under the North
                               American Waterfowl
                               Management Plan with
                               Canada and Mexico. May
                               fund projects in Canada
                               or Mexico.

Department of Justice
--------------------------------------------------------------------------------
Federal Bureau of             Total costs of                       34
 Investigation (FBI)           international
                               activities will be
                               higher. Continues legal
                               attachï¿½ expansion plan,
                               assigns additional
                               agents overseas to
                               fight drug trafficking,
                               and continues
                               investigative efforts
                               against drug
                               trafficking and public
                               corruption along the
                               Southwest border.
Interpol-U.S. National        Serves as U.S. liaison               7
 Central Bureau                to International
                               Criminal Police
                               Organization and
                               facilitates
                               international law
                               enforcement
                               cooperation.

Department of Labor
--------------------------------------------------------------------------------
International Labor Affairs   Supports U.S. foreign                11
                               policy objectives
                               through relationships
                               with international
                               organizations and
                               foreign governments;
                               provides analysis on
                               the labor market and
                               economic impact of
                               trade proposals and
                               legislation, and
                               immigration-related
                               initiatives; and does
                               assessments of
                               compliance with worker
                               rights provisions in
                               U.S. trade law.

Department of State
--------------------------------------------------------------------------------
International Boundary and    Negotiates and                       18
 Water Commission              supervises joint
                               projects with Mexico to
                               solve international
                               problems and operate
                               and maintain
                               facilities.
International Boundary and    Constructs projects to               6
 Water Commission:             solve international
 construction                  problems of water
                               supply and quality,
                               sewage treatment, and
                               flood-damage reduction.
                               EPA reimburses.
International commissions     International Boundary               6
                               Commission maintains
                               boundary between the
                               United States and
                               Canada. International
                               Joint Commission
                               approves, regulates,
                               and monitors structures
                               in boundary waters and
                               investigates matters
                               referred by the United
                               States and Canada,
                               mainly transboundary
                               environmental issues.
                               Border Environment
                               Cooperation Commission
                               works with states and
                               local communities to
                               develop solutions to
                               environmental problems
                               in border regions.
International Fisheries       Funds U.S. share of                  15
 Commissions                   expenses for eight
                               international fisheries
                               commissions, three
                               international marine
                               science sea
                               organizations, one
                               international council,
                               and the expenses of the
                               commissioners.

Department of Transportation
--------------------------------------------------------------------------------
Maritime Administration:      Promotes growth of U.S.              39
 Maritime Guaranteed Loan      merchant marine and
 (title XI) Program            shipyards. Extended to
                               foreign purchasers and
                               for conversion from
                               military to
                               international commerce.
Maritime Security Program     Replaces operating-                  54
                               differential subsidies.
                               Maintains a U.S.-flag
                               merchant fleet crewed
                               by U.S. citizens to
                               serve U.S. commercial
                               and national security
                               needs. Pays U.S.
                               shippers engaged in
                               U.S.-foreign trade.
Maritime Administration:      Increases                            70
 operations and training       competitiveness and
                               productivity of U.S.
                               maritime industries and
                               provides manpower for
                               emergencies. Funds
                               administration and
                               direction, officer
                               training, coordination
                               of U.S. maritime
                               industry activities
                               under emergency
                               conditions; promotes
                               port and intermodal
                               development; and
                               undertakes technology
                               assessment projects.

Department of the Treasury
--------------------------------------------------------------------------------
Secretary -international      Recommends and                       29
 activities                    implements U.S.
                               international tax,
                               financial, fiscal, and
                               economic policies;
                               maintains foreign
                               assets control; manages
                               development financial
                               policy; represents the
                               United States on
                               international monetary,
                               trade, and investment
                               issues and treaties;
                               oversees operations
                               abroad; and oversees
                               law enforcement
                               bureaus.

The Judiciary
--------------------------------------------------------------------------------
U.S. Court of International   Exercises original and               10
 Trade                         exclusive jurisdiction
                               of civil actions
                               against the United
                               States, and certain
                               civil actions brought
                               by the United States,
                               arising out of import
                               transactions and
                               federal statutes
                               affecting international
                               trade.

Independent
--------------------------------------------------------------------------------
Intelligence Community        Supports intelligence                96
 Management Account            community.
NASA: Space Station           Participates in                    2,114
                               international research
                               project.
NASA: U.S./Russia Program     Participates in joint                7
                               space missions,
                               including Mir.
================================================================================
Total funding request                                            $7,579
--------------------------------------------------------------------------------
Legend

EPA = Environmental Protection Agency
NASA = National Air and Space Administration
NATO = North Atlantic Treaty Organization
NIH = National Institutes of Health



                                    Table I.2
                     
                       International-related Programs Where
                        Specific Funding Is Not Identified

Program                    International role
-------------------------  -----------------------------------------------------
Executive Office of the President
--------------------------------------------------------------------------------
National Economic Council  Participates in setting and carrying out all
                           international affairs goals.

Office of National Drug    Oversees international drug control programs.
Control Policy             Develops U.S. national drug control strategy and
                           oversees and coordinates the drug control efforts of
                           about 50 different U.S. federal agencies engaged in
                           implementing the strategy. Supports protection of
                           U.S. air, sea, and land borders from the importation
                           of illegal narcotics.

Office of Science and      Coordinates implementation of international science
Technology Policy          and technology agreements.

Unanticipated needs        Furthers national interest, security, or defense at
                           home or abroad.


Department of Agriculture
--------------------------------------------------------------------------------
Alternative agricultural   Helps improve U.S. competitiveness abroad.
research

Animal and Plant Health    Participates in foreign cooperative programs,
Inspection                 inspections, and international trade in certain
                           endangered species.

Commodity Credit           Procures goods from foreign and domestic sources for
Corporation: supply and    foreign and domestic use.
foreign purchases

Farm Service Agency        Supports Foreign Agricultural Service.

Food Safety and            Inspects domestic plants involved in foreign trade
Inspection                 and reviews foreign inspection systems.

Grain inspection,          Regulates weighing of grain and registers buyers in
packers, and stockyard     foreign commerce, briefs foreign buyers, assesses
                           foreign inspection and weighing techniques, and
                           responds to foreign complaints.

Office of the Chief        Collects and analyzes data on international food and
Economist                  agriculture.


Department of Commerce
--------------------------------------------------------------------------------
Bureau of Economic         Prepares international economic accounts that provide
Analysis                   information on international transactions in goods,
                           services, investment income, and government and
                           private financial flows and are used to formulate and
                           evaluate international economic policy.

Bureau of the Census       Collects and publishes foreign trade statistics.

Minority Business          Expands international markets for minority-owned
Development Agency         businesses.

National Institute of      Assists with international standardization
Standards and Technology   certification.

National Oceanic and       Monitors compliance with select fisheries acts,
Atmospheric                monitors and predicts global environments, and
Administration             supports global environmental programs.

Patent and Trademark       Develops and implements intellectual property
Office                     policies and proposals abroad.


Department of Defense
--------------------------------------------------------------------------------
Counterterrorism           Combats terrorism; with the FBI, trains and equips
                           former Soviet Union and Eastern European law
                           enforcement officials, judges, and prosecutors to
                           counter nuclear material smuggling and trafficking
                           and chemical and biological weapons proliferation.

Other countries'           Supports foreign partners' participation in joint
participation in joint     exercises and projects, including the Warsaw
exercises                  Initiative, Army's Developing Countries Combined
                           Exercise Program, and Joint Contact Team.


Department of Education
--------------------------------------------------------------------------------
Bilingual and immigrant    Assists local educators in providing high-quality
education                  instructional programs to children and youth with
                           limited English proficiency.

International language     Supports international education and foreign language
and study                  study programs.


Department of Energy
--------------------------------------------------------------------------------
Counterterrorism           With others, trains personnel from six countries in
                           the former Soviet Union on investigating and
                           prosecuting nuclear-related crimes; and reduces the
                           opportunity for terrorists to acquire nuclear
                           materials.

Defense Environmental      Receives and manages foreign research reactor spent
Restoration                nuclear fuel.

Energy Efficiency and      Increases national security and creates jobs and
Pollution Prevention       global opportunities for U.S. firms.

Energy Information         Prepares reports on international matters.
Administration

Energy Supply Research     Improves prediction of global change, including
and Development            climate; provides scientific contribution to
                           international activities and negotiations; enhances
                           global sales of U.S. energy products, and provides
                           technical assistance.

International agreements   Participates in the development and implementation of
                           international agreements, such as the Nuclear Safety
                           Convention, the U.S./North Korean Agreed Framework on
                           Nuclear Issues, and the Agreement for Cooperation
                           Between the United States and the European Atomic
                           Energy Community Concerning Peaceful Uses of Atomic
                           Energy.

Nuclear Materials          Tracks civilian-use nuclear materials imported by the
Management and Safeguards  United States and exported to foreign countries.
System                     Relies largely on data required to be reported under
                           international agreements for peaceful nuclear
                           cooperation.

Office of Policy           Formulates international energy policy, analyzes and
                           assesses current world energy situation, and
                           participates in international efforts.

Strategic Petroleum        Enables the United States to meet International
Reserve                    Energy Agency's emergency response plans.

U.S. Bilateral Physical    Evaluates foreign countries' physical protection
Protection Program         systems, addresses emerging nuclear proliferation
                           threats and problems, promotes technical exchanges
                           and cooperation for physical protection, strengthens
                           international cooperation and implementation of
                           treaties and agreements.

Western Area Power         Markets power from federally owned power plants,
Administration             including the International Boundary and Water
                           Commission.


Department of Health and Human Services
--------------------------------------------------------------------------------
Office of International    Promotes achievement of U.S. and international goals
and Refugee Health         through participation in multilateral health
                           organizations, promotes cooperative health programs
                           with other countries, provides humanitarian and
                           developmental assistance in health, and helps assure
                           appropriate policies and support on refugee health
                           issues internationally.


Department of the Interior
--------------------------------------------------------------------------------
Assistance to territories  Supports operations and provides assistance to
                           territories and freely associated states.

Fish and Wildlife          Provides technical assistance, training, joint
Service: international     research, and personnel exchanges in international
                           fisheries and wildlife management efforts, including
                           the protection of biological diversity.

Fish and Wildlife          Enhances compliance with international agreement on
Service: Rhinoceros and    trade in endangered species.
Tiger Conservation Fund


Department of Justice
--------------------------------------------------------------------------------
Counterterrorism Fund      Supports efforts to counter, investigate, or
                           prosecute domestic or international terrorism.

Criminal Division          Supports the formulation and execution of
                           international criminal justice enforcement policies;
                           participates in the negotiation of international
                           agreements and treaties relating to criminal law
                           enforcement, extradition, and mutual legal
                           assistance; posts attorneys abroad; enforces U.S.
                           laws against importing goods made with prison labor
                           by prosecuting criminal cases; and prosecutes cases
                           against international drug traffickers and money
                           launderers and seizes and forfeits their illicit
                           proceeds and laundered assets overseas.

Drug Enforcement           Conducts international investigations, posts staff
Administration             overseas, coordinates drug enforcement intelligence
                           gathering overseas, conducts law enforcement
                           operations, and provides training to foreign
                           government law enforcement personnel.

Drug Enforcement           Participates in foreign cooperative investigations.
Administration: Violent
Crime Reduction Program

FBI                        Protects the United States from foreign hostile
                           intelligence efforts. Assist international law
                           enforcement agencies. Combat terrorism; with others,
                           train and equip former Soviet Union and Eastern
                           European law enforcement officials, judges, and
                           prosecutors to counter nuclear material smuggling and
                           trafficking and chemical and biological weapons
                           proliferation.

Federal prison system      Provides technical assistance and advice on
                           corrections-related issues to foreign governments.

Immigration and            Administers laws relating to the admission,
Naturalization Service     exclusion, deportation, and naturalization of aliens;
                           posts staff abroad; and conducts investigations.

Legal activities           Enforces U.S. laws against importing goods made with
                           prison labor by prosecuting criminal cases and
                           defending Customs' determinations; prosecutes cases
                           against international drug traffickers and money
                           launderers and seizes and forfeits their illicit
                           proceeds and laundered assets domestically and
                           abroad.


Department of Transportation
--------------------------------------------------------------------------------
Coast Guard                Conducts safety programs; supports international
                           investigations; posts staff abroad; eliminates
                           maritime routes as a significant trafficking mode for
                           the supply of illegal drugs to the United States; and
                           enforces treaties.

Federal Aviation           Conducts safety programs, supports international
Administration             investigations, posts staff abroad, provides
                           technical assistance, oversees foreign carriers, and
                           supports efforts to combat terrorism domestically and
                           abroad.

Federal Highway            Promotes U.S. businesses abroad and provides
Administration             technical assistance to foreign governments
                           (reimbursed).

National Transportation    Helps to develop worldwide safety standards and
Safety Board               practices in civil aviation, disseminates accident
                           and incident information, and helps foreign countries
                           investigate transportation accidents.

Office of International    Negotiates bilateral aviation accords and addresses
Aviation                   problems U.S. airlines face in doing business abroad.

Transportation policy and  Provides departmental leadership on aviation economic
planning                   policy and international transportation issues.


Department of the Treasury
--------------------------------------------------------------------------------
Bureau of Alcohol,         Supports international law enforcement, posts staff
Tobacco, and Firearms      abroad, and trains foreign law enforcement officials.

Comptroller of the         Coordinates with foreign counterparts, participates
Currency                   in international banking agreements, and charters and
                           supervises foreign banks.

Debt Collection            Settles international claims.
Improvement Account

Federal Law Enforcement    Trains foreign law enforcement officials
Training Center            (reimbursable).

Financial Crimes           Identifies underlying criminal financial activity and
Enforcement Network        emerging trends and patterns of international money
                           laundering investigations; empowers international law
                           enforcement to take action against financial
                           criminals through the transfer of information and
                           expertise; and helps other countries meet
                           international anti-money laundering standards.

Internal Revenue Service   Assists international investigations, posts staff
                           abroad, trains foreign law officials, provides
                           technical assistance to foreign governments, manages
                           tax treaties, and monitors compliance of foreign-
                           controlled companies with relevant U.S. income tax
                           laws.

U.S. Customs Service       Processes persons and cargo entering the United
                           States; enforces import and export laws; collects and
                           reports trade statistics; supports international
                           investigations; enforces international agreements;
                           supports counterterrorism efforts; with others,
                           trains personnel from six former Soviet Union
                           countries on investigating and prosecuting nuclear-
                           related crimes; and interdicts illegal drugs and
                           investigates drug-smuggling organizations.

U.S. Secret Service        Assists international investigations; posts staff
                           abroad; provides technical assistance to foreign
                           governments; and protects select foreign visitors,
                           foreign diplomatic missions in the United States, and
                           select U.S. officials abroad.


The Judiciary
--------------------------------------------------------------------------------
U.S. Court of Appeals for  Exercises jurisdiction over international trade
the Federal Circuit        cases.

Defender Services          Compensates and reimburses travel expenses of
                           guardians acting on behalf of financially eligible
                           minor or incompetent offenders in connection with
                           transfers from the United States to foreign
                           countries.


Legislative
--------------------------------------------------------------------------------
Legislative branch boards  Participates in Commission on Security and
and commissions            Cooperation in Europe and House and Senate
                           international meetings.

Library of Congress:       Trains nationals of developing countries in
International Copyright    intellectual property laws and policies.
Institute

Library of Congress        Operates overseas centers.

U.S. General Accounting    Provides information on national security and
Office                     international affairs and gives training to foreign
                           audit organizations.


Independent
--------------------------------------------------------------------------------
Central Intelligence       Gathers intelligence abroad.
Agency

Commodity Futures Trading  Coordinates with international regulators.
Commission

Environmental Protection   Participates in international negotiations, provides
Agency                     technical assistance, opens commercial opportunities
                           for U.S. firms, supports international research, and
                           supports U.S.-Mexico Border Environmental Plan.

Federal Communications     Helps oversee COMSAT. Promotes competition in
Commission                 international telecommunications.

Federal Labor Relations    Resolves labor negotiation impasses, including those
Authority                  involving Panama Canal workers.

Federal Reserve System     Self-financing entity but revenues contribute to
                           total U.S. government revenues. Conducts monetary
                           policy (including helping to stabilize financial
                           markets internationally and to detect and combat
                           counterfeiting of U.S. currency abroad), supervises
                           and regulates banks (including the foreign activities
                           of member banks, U.S. operations of foreign banks,
                           and international banking agreements), and
                           coordinates with international counterparts.

Marine Mammal Commission   Recommends international policies on marine mammals.

NASA: Commercial           Strengthens international competitiveness of key
Technology Program         industry sectors.

NASA: life and             Refines the experiment hardware planned for use on
microgravity science       the International Space Station.

NASA: mission              Supports international space-faring agencies on a
communication services     reimbursable basis.

NASA: Mission to Planet    Participates in global change research.
Earth

National Science           Facilitates international scientific cooperation.
Foundation: research

National Science           Studies polar regions, which have a major influence
Foundation: U.S. polar     on world weather and climate and are considered as
research                   likely bellwethers of global climate change.
                           Participates in international cooperative efforts
                           among nations with Arctic regions, or with Antarctic
                           interests.

Nuclear Regulatory         Renders services to foreign governments and
Commission                 international organizations; participates in
                           development and implementation of the Nuclear Safety
                           Convention; and reviews licenses to export nuclear
                           materials. Some costs reimbursed.

Securities and Exchange    Coordinates with international counterparts to
Commission                 discuss securities developments, development and
                           implementation of cooperation agreements concerning
                           securities, and provision of technical assistance for
                           the development of foreign securities markets.
                           Supervises and regulates securities markets to ensure
                           fairness and competition and meet changing
                           international conditions.

Small Business             Encourages small business exports and improves access
Administration             to capital for trade finance.

Smithsonian Institution    Supports U.S. overseas research centers.
--------------------------------------------------------------------------------
RELATED GAO PRODUCTS


   SECURITY
--------------------------------------------------------- Appendix I:1

NATO Enlargement:  Cost Implications for the United States Remain
Unclear (GAO/T-NSIAD-98-50, Oct.  23, 1997). 

Combating Terrorism:  Federal Agencies' Efforts to Implement National
Policy and Strategy (GAO/NSIAD-97-254, Sept.  26, 1997). 

Cooperative Threat Reduction:  Review of DOD's June 1997 Report on
Assistance Provided (GAO/NSIAD-97-218, Sept.  5, 1997). 

NATO Enlargement:  Cost Estimates Developed to Date Are Notional
(GAO/NSIAD-97-209, Aug.  18, 1997). 

Military Offsets:  Regulations Needed to Implement Prohibition on
Incentive Payments (GAO/NSIAD-97-189, Aug.  12, 1997). 

NATO Enlargement:  U.S.  and International Efforts to Assist
Potential New Members (GAO/NSIAD-97-164, June 27, 1997). 

Nuclear Nonproliferation:  Implementation of the U.S./North Korean
Agreed Framework on Nuclear Issues (GAO/RCED/NSIAD-97-165, June 2,
1997). 

Hong Kong's Reversion to China:  Effective Monitoring Critical to
Assess U.S.  Nonproliferation Risks (GAO/NSIAD-97-149, May 22, 1997.)

Export Controls:  Sales of High Performance Computers to Russia's
Nuclear Weapons Laboratories (GAO-T-NSIAD-97-128, Apr.  15, 1997). 

Cooperative Threat Reduction:  Status of Defense Conversion Efforts
in the Former Soviet Union (GAO/NSIAD-97-101, Apr.  11, 1997). 

Nuclear Safety:  International Atomic Energy Agency's Nuclear
Technical Assistance for Cuba (GAO/RCED-97-72, Mar.  24, 1997). 

Weapons of Mass Destruction:  DOD Reporting on Cooperative Threat
Reduction Assistance Has Improved (GAO/NSIAD-97-84, Feb.  27, 1997). 

Nuclear Safety:  Uncertainties About the Implementation and Costs of
the Nuclear Safety Convention (GAO/RCED-97-39, Jan.  2, 1997). 

Nuclear Safety:  Status of U.S.  Assistance to Improve the Safety of
Soviet-Designed Reactors (GAO/RCED-97-5, Oct.  29, 1996). 

Nuclear Weapons:  Russia's Request for the Export of U.S.  Computers
for Stockpile Maintenance (GAO/T-NSIAD-96-245, Sept.  30, 1996). 

Weapons of Mass Destruction:  Status of the Cooperative Threat
Reduction Program (GAO/NSIAD-96-222, Sept.  27, 1996). 

School of the Americas:  U.S.  Military Training for Latin American
Countries (GAO/NSIAD-96-178, Aug.  22, 1996). 

Nuclear Nonproliferation:  Status of U.S.  Efforts to Improve Nuclear
Material Controls in Newly Independent States (GAO/NSIAD-96-89, Mar. 
8, 1996). 

Foreign Assistance:  Controls Over U.S.  Funds Provided for the
Benefit of the Palestinian Authority (GAO/NSIAD-96-18, Jan.  8,
1996). 

Military Exports:  Offset Demands Continue to Grow (GAO/NSIAD-96-65,
Apr.  12, 1996). 

Foreign Military Sales (GAO/NSIAD-96-50R, Dec.  12, 1995). 

Military Exports:  A Comparison of Government Support in the United
States and Three Major Competitors (GAO/NSIAD-95-86, May 18, 1995). 

Greece and Turkey:  U.S.  Assistance Programs and Other Activities
(GAO/NSIAD-95-100, Apr.  17, 1995). 

Cost of Assistance and Sales Programs (GAO/NSIAD-95-110R, Mar.  2,
1995). 

DOD Budget:  Selected Categories of Planned Funding for Fiscal
Years 1995-99 (GAO/NSIAD-95-92, Feb.  17, 1995). 

Military Exports:  Concerns Over Offsets Generated With U.S.  Foreign
Military Financing Program Funds (GAO/NSIAD-94-127, June 22, 1994). 

Foreign Military Sales:  Use of FMS in Proposed Commercial Sale of
Airborne Self-Protection Jammer (GAO/NSIAD-94-202, June 16, 1994). 

Military Sales' Cash Flow Financing (GAO/NSIAD-94-102R, Feb.  8,
1994). 

Security Assistance:  Need for Improved Reporting on Excess Defense
Article Transfers (GAO/NSIAD-94-27, Jan.  18, 1994). 

Foreign Military Aid to Israel:  Diversion of U.S.  Funds and
Circumvention of U.S.  Program Restrictions (GAO/T-OSI-94-9, Oct. 
27, 1993). 

Military Aid to Egypt:  Tank Coproduction Raised Costs and May Not
Meet Many Program Goals (GAO/NSIAD-93-203, July 27, 1993). 

Military Sales to Israel and Egypt:  DOD Needs Stronger Controls Over
U.S.-Financed Procurements (GAO/NSIAD-93-184, July 7, 1993). 

Security Assistance:  Excess Defense Articles for Foreign Countries
(GAO/NSIAD-93-164FS, Mar.  23, 1993). 


   PEACEKEEPING
--------------------------------------------------------- Appendix I:2

Bosnia:  Cost Estimating Has Improved but Operational Changes Will
Affect Current Estimates (GAO/NSIAD-97-183, July 28, 1997). 

Bosnia Peace Operation:  Progress Toward the Dayton Agreement's
Goals--An Update (GAO/T-NSIAD-97-216, July 17, 1997). 

Bosnia Peace Operation:  Progress Toward Achieving the Dayton
Agreement's Goals (GAO/NSIAD-97-132, May 5, 1997). 

U.N.  Peacekeeping:  Issues Related to Effectiveness, Cost, and
Reform (GAO/T-NSIAD-97-139, Apr.  9, 1997). 

United Nations:  Limitations in Leading Missions Requiring Force to
Restore Peace (GAO/NSIAD-97-34, Mar.  27, 1997). 

U.N.  Peacekeeping:  Status of Long-standing Operations and U.S. 
Interests in Supporting Them (GAO/NSIAD-97-59, Apr.  9, 1997). 

Peace Operations:  U.S.  Costs in Support of Haiti, former
Yugoslavia, Somalia, and Rwanda (GAO/NSIAD-96-38, Mar.  6, 1996). 

Peacekeeping:  Assessment of U.S.  Participation in the Multinational
Force and Observers (GAO/NSIAD-95-113, Aug.  15, 1995). 

Peace Operations:  DOD's Incremental Costs and Funding for Fiscal
Year 1994 (GAO/NSIAD-95-119BR, Apr.  18, 1995). 


   DRUG CONTROL
--------------------------------------------------------- Appendix I:3

Drug Control:  U.S.  Heroin Control Efforts in Southwest Asia and the
Former Soviet Union (GAO/NSIAD-97-148BR, May 9, 1997). 

Drug Control:  Long-standing Problems Hinder U.S.  International
Efforts (GAO/NSIAD-97-75, Feb.  27, 1997). 

Drug Control:  U.S.  Heroin Control Efforts in Southeast Asia
(GAO/T-NSIAD-96-240, Sept.  19, 1996). 

Drug Control:  Observations on Counternarcotics Activities in Mexico
(GAO/T-NSIAD-96-239, Sept.  12, 1996). 


   BILATERAL ASSISTANCE
--------------------------------------------------------- Appendix I:4

Foreign Assistance:  USAID's Reengineering at Overseas Missions
(GAO/NSIAD-97-194, Sept.  12, 1997). 

The Results Act:  Observations on USAID's November 1996 Draft
Strategic Plan (GAO/NSIAD-97-197R, July 11, 1997). 

Foreign Assistance:  Impact of Funding Restrictions on USAID's
Voluntary Family Planning Program (GAO/NSIAD-97-123, Apr.  25, 1997). 

Foreign Assistance:  Harvard Institute for International
Development's Work in Russia and Ukraine (GAO/NSIAD-97-27, Nov.  27,
1996). 

USAID Democracy Contracts (GAO/NSIAD-97-19R, Nov.  27, 1996). 

Foreign Assistance:  Contributions to Child Survival Are Significant,
but Challenges Remain (GAO/NSIAD-97-9, Nov.  8, 1996). 

Foreign Assistance:  Status of USAID's Reforms (GAO/NSIAD-96-241BR,
Sept.  24, 1996). 

International Relations:  Food Security in Africa
(GAO/T-NSIAD-96-217, July 31, 1996). 

Former Soviet Union:  Information on U.S.  Bilateral Program Funding
(GAO/NSIAD-96-37, Dec.  15, 1995). 

Foreign Housing Guaranty Program:  Financial Condition Is Poor and
Goals Are Not Achieved (GAO/NSIAD-95-108, June 2, 1995). 

Promoting Democracy:  Foreign Affairs and Defense Agencies' Funds and
Activities--1991 to 1993 (GAO/NSIAD-94-83, Jan.  4, 1994). 


   FOREIGN AFFAIRS MANAGEMENT
--------------------------------------------------------- Appendix I:5

State Department:  Using Best Practices to Relocate Employees Could
Reduce Costs and Improve Service (GAO/NSIAD-98-19, Oct.  17, 1997). 

The Results Act:  Observations on the Department of State's May 1997
Draft Strategic Plan (GAO/NSIAD-97-198R, July 18, 1997). 

State Department:  Efforts to Reduce Visa Fraud (GAO/T-NSIAD-97-167,
May 20, 1997). 

Vietnamese Asylum Seekers:  A Review of Selected Cases in Four
Southeast Asia Countries (GAO/NSIAD-97-51, Dec.  31, 1996). 

Foreign Affairs:  Perspectives on Foreign Affairs Programs and
Structures (GAO/NSIAD-97-6, Nov.  8, 1996). 

State Department:  Options for Addressing Possible Budget Reductions
(GAO/NSIAD-96-124, Aug.  29, 1996). 

Overseas Real Estate:  Millions of Dollars Could Be Generated by
Selling Unneeded Real Estate (GAO/NSIAD-96-36, Apr.  23, 1996). 

Overseas Presence:  Staffing at U.S.  Diplomatic Posts
(GAO/NSIAD-95-50FS, Dec.  28, 1994). 

State Department:  Overseas Staffing Process Not Linked to Policy
Priorities (GAO/NSIAD-94-228, Sept.  20, 1994). 


   PUBLIC DIPLOMACY
--------------------------------------------------------- Appendix I:6

U.S.  Information Agency:  Options for Addressing Possible Budget
Reductions (GAO/NSIAD-96-179, Sept.  23, 1996). 

Exchange Programs:  Inventory of International Educational, Cultural,
and Training Programs (GAO/NSIAD-93-157BR, June 23, 1993). 


   MULTILATERAL ASSISTANCE
--------------------------------------------------------- Appendix I:7

Multilateral Organizations:  U.S.  Contributions to International
Organizations for Fiscal Year 1993-95 (GAO/NSIAD-97-42, May 1, 1997). 

International Organizations:  U.S.  Participation in the United
Nations Development Program (GAO/NSIAD-97-8, April 17, 1997). 

Nuclear Safety:  International Atomic Energy Agency's Nuclear
Technical Assistance for Cuba (GAO/RCED-97-72, Mar.  24, 1997). 

State Department:  U.S.  Participation in Special-Purpose
International Organizations (GAO/NSIAD-97-35, Mar.  6, 1997). 

United Nations:  U.S.  Participation in Five Affiliated International
Organizations (GAO/NSIAD-97-2, Feb.  27, 1997). 

United Nations:  Status of Alternative Revenue Raising Proposals
(GAO/NSIAD-97-31, Nov.  8, 1996). 

World Bank:  U.S.  Interests Supported, but Oversight Needed to Help
Ensure Improved Performance (GAO/NSIAD-96-212, Sep.  26, 1996). 


   EXPORT PROMOTION AND
   FINANCE-OVERALL STRATEGY AND
   COORDINATION
--------------------------------------------------------- Appendix I:8

Export Finance:  Federal Efforts to Support Working Capital Needs of
Small Business (GAO/NSIAD-97-20, Feb.  13, 1997). 

National Export Strategy (GAO/NSIAD-96-132R, Mar.  26, 1996). 

Government Reorganization:  Observations About Creating a U.S.  Trade
Administration (GAO/T-GGD-95-234, Sep.  6, 1995). 

Government Reorganization:  Issues Relating to International Trade
Responsibilities (GAO/T-GGD-95-218, July 25, 1995). 

U.S.  & Foreign Commercial Service:  Comments on Proposed Transfer to
the Department of State (GAO/T-GGD-95-141, Mar.  21,1995). 

Export Finance:  Comparative Analysis of U.S.  and European Union
Export Credit Agencies (GAO/GGD-96-1, Oct.  24, 1995). 

Export Promotion:  Rationales for and Against Government Programs and
Expenditures (GAO/T-GGD-95-169, May 23, 1995). 

International Trade:  U.S.  Efforts to Counter Competitors' Tied Aid
Practices (GAO/T-GGD-95-128, Mar.  28, 1995). 

International Trade:  Combating U.S.  Competitors' Tied Aid Practices
(GAO/T-GGD-94-156, May 25, 1994). 


   EXPORT-IMPORT BANK
--------------------------------------------------------- Appendix I:9

Export-Import Bank:  Key Factors in Considering Eximbank
Reauthorization (GAO/T-NSIAD-97-215, July 17, 1997). 

U.S.  Export-Import Bank:  Process in Place to Ensure Compliance with
Dual-Use Export Requirements (GAO/NSIAD-97-211, July 17, 1997). 

Export-Import Bank:  Reauthorization Issues (GAO/T-NSIAD-97-147, Apr. 
29, 1997). 

Ex-Im Bank's Retention Allowance Program (GAO/GGD-97-37R, Feb.  19,
1997). 

Export Finance:  Federal Efforts to Support Working Capital Needs of
Small Business (GAO/NSIAD-97-20, Feb.  13, 1997). 

Export-Import Bank:  Options for Achieving Possible Budget Reductions
(GAO/NSIAD-97-7, Dec.  20, 1996). 

Retention Allowances:  Usage and Compliance Vary Among Federal
Agencies (GAO/GGD-96-32, Dec.  11, 1995). 

Export Finance:  Challenges Facing the U.S.  Export-Import Bank
(GAO/T-GGD-94-46, Nov.  3, 1993). 


   FOOD AID AND CARGO PREFERENCE
-------------------------------------------------------- Appendix I:10

Food Aid:  Competing Goals and Requirements Hinder Title I Program
Results (GAO/GGD-95-68, June 26, 1995). 

Cargo Preference Requirements:  Objectives Not Significantly Advanced
When Used in U.S.  Food Aid Programs (GAO/GGD-94-215, Sept.  29,
1994). 


   OTHER TRADE RELATED
-------------------------------------------------------- Appendix I:11

U.S.  Agricultural Exports:  Strong Growth Likely but U.S.  Export
Assistance Programs' Contribution Uncertain (GAO/NSIAD-97-260, Sept. 
30, 1997). 

Overseas Investment:  Issues Related to the Overseas Private
Investment Corporation's Reauthorization (GAO/NSIAD-97-230, Sept.  8,
1997). 

Trade Liberalization:  Western Hemisphere Trade Issues Confronting
the United States (GAO/NSIAD-97-119, July 21, 1997). 

The Results Act:  Observations on USTR's September 1996 Draft
Strategic Plan (GAO/NSIAD-97-199R, July 18, 1997). 

Customs Service:  Office of International Affairs (GAO/NSIAD-97-146R,
Apr.  25, 1997). 

World Trade Organization:  Observations on the Ministerial Meeting in
Singapore (GAO/T-NSIAD-97-92, Feb.  26, 1997). 

U.S.-Japan Trade:  U.S.  Company Views on the Implementation of the
1994 Insurance Agreement (GAO/NSIAD-97-64BR, Dec.  20, 1996). 

International Trade:  Challenges and Opportunities for U.S. 
Businesses in China (GAO/T-NSIAD-96-214, July 29, 1996). 

U.S.  Trade and Development Agency:  Limitations Exist in Its Ability
to Help Generate U.S.  Exports (GAO/GGD-94-9, Oct.  20, 1993). 

International Trade Commission:  Administrative Authority Is
Ambiguous (GAO/NSIAD-92-45, Feb.  25, 1992). 


   TRANSPORTATION AND
   TELECOMMUNICATIONS
-------------------------------------------------------- Appendix I:12

International Aviation:  Competition in the U.S.-U.K.  Market
(GAO/T-RCED-97-103, June 4, 1997). 

International Aviation:  DOT's Efforts to Promote U.S.  Air Cargo
Carriers' Interests (GAO/RCED-97-13, Oct.  18, 1996). 

Telecommunications:  Competition Issues in International Satellite
Communications (GAO/RCED-97-1, Oct.  11, 1996). 

International Aviation:  DOT Needs More Information to Address U.S. 
Airlines' Problems in Doing Business Abroad (GAO/RCED-95-24, Nov. 
29, 1994). 


   FOOD SAFETY
-------------------------------------------------------- Appendix I:13

Agricultural Inspection:  Improvements Needed to Minimize Threat of
Foreign Pests and Diseases (GAO/RCED-97-102, May 5, 1997). 

Food Safety:  Procedures for Inspecting Canadian Meat Imports
(GAO/T-RCED-97-21, Apr.  2, 1997). 


   FINANCE
-------------------------------------------------------- Appendix I:14

International Financial Crises:  Efforts to Anticipate, Avoid, and
Resolve Sovereign Crises (GAO/GGD/NSIAD-97-16, July 7, 1997). 

Financial Crisis Management:  Four Financial Crises in the 1980s
(GAO/GGD-97-96, May 1, 1997). 

Foreign Banks:  Opportunities Exist to Enhance Supervision Program as
Implementation Proceeds (GAO/GGD-97-80, May 9, 1997). 

Foreign Banks:  Implementation of the Foreign Bank Supervision
Enhancement Act of 1991 (GAO/GGD-96-187, Sept.  30, 1996). 


   ENVIRONMENT
-------------------------------------------------------- Appendix I:15

International Environment:  Operations of the Montreal Protocol
Multilateral Fund (GAO/T-RCED-97-218, July 30, 1997). 

International Environment:  U.S.  Funding of Environmental Programs
and Activities (GAO/RCED-96-234, Sept.  30, 1996). 

Global Warming:  Difficulties Assessing Countries' Progress
Stabilizing Emissions of Greenhouse Gases (GAO/RCED-96-188, Sept.  4,
1996). 

International Environment:  Environmental Infrastructure Needs in the
U.S.-Mexican Border Region Remain Unmet (GAO/RCED-96-179, July 22,
1996). 


   OTHER INTERNATIONAL
-------------------------------------------------------- Appendix I:16

Space Station:  Cost Control Problems Continue to Worsen
(GAO/T-NSIAD-97-177, July 18, 1997). 


   OVERALL MANAGEMENT AND BUDGET
-------------------------------------------------------- Appendix I:17

Managing for Results:  Using the Results Act to Address Mission
Fragmentation and Program Overlap (GAO/AIMD-97-146, Aug.  29, 1997). 

Budget Issues:  Fiscal Year 1996 Agency Spending by Budget Function
(GAO/AIMD-97-95, May 13, 1997). 

Addressing the Deficit:  Budgetary Implications of Selected GAO Work
for Fiscal Year 1998 (GAO/OCG-97-2, Mar.  14, 1997). 


*** End of document. ***