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At the start of the new Millennium, the U.S. Agency for International Development (USAID) identified an important trend in development funding: the private sector accounted for more than 80 percent of investment in the developing world. This trend marked a reversal from 40 years earlier when public assistance provided for the vast majority of resource flows to developing countries. As a result, a vast array of new actors was playing a significant role in the field of development assistance. Recognizing this change, USAID created the Global Development Alliance approach to partnerships as a new way to implement foreign assistance.
In 2001, a team of leading thinkers at USAID developed the Global Development Alliance concept for public-private partnerships. Then Administrator Andrew Natsios endorsed the partnership model immediately and prioritized the Global Development Alliance initiative. The model was also endorsed by then Secretary of State Colin Powell, who championed the Global Development Alliance as "a new strategic orientation for USAID."
Under Powell and Natsios, USAID forged ahead with a new Business Model for the 21st Century: aligning public resources with private capital, expertise and networks to deepen development impact. USAID Career Foreign Service Officer Holly Wise was appointed head of the fledgling Global Development Alliance Secretariat. Under her leadership, USAID built upon its long history of working in partnership with non-governmental organizations (NGO's), foundations, and international organizations to expand and deepen its relationship with private sector companies - ties which were previously under-valued.
Building upon the new realities of development assistance and direct investment in emerging economies, the Global Development Alliance model of public-private partnerships welcomed private sector partners as full collaborators in the implementation, design, and funding of development projects. No longer the majority stakeholder in the alliances it forged, USAID's approach united the skills and resources of both the public and private sectors and applied them to achieve outcomes that no one actor could realize on its own.
Around the globe, USAID has developed significant partnerships with local and global organizations to address issues as varied as environmental protection, small and medium enterprise development, and education and youth unemployment. For over a decade, the Global Development Alliance approach has proven enormously successful with more than 1,600 alliances formed with over 3,000 distinct partners, leveraging billions in combined public and private sector resources.*
Global Partnerships Today
Today, USAID has elevated partnerships from the realm of charitable contributions and private philanthropy to focus on the core business interests of private firms and their long-term corporate social responsibility goals. By engaging around overlapping business and development interests with traditional NGO and host government partners, the Global Development Alliance model is contributing to long-term, sustainable economic and social growth in developing countries.
* Partner contributions are estimates provided to USAID by its partners and may include contributions by various partners including the private sector, non-governmental organizations, foreign governments and other organizations. Estimated contributions include cash and in-kind resources. In-kind resources estimates may have been valued by non-USAID partner organizations. Partner contribution estimates are not audited.
Last updated: May 17, 2013