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	Statement of the Administrator Summary of FY 2006 Budget Request Program Highlights Management Improvements USAID Support Budget Operating Expenses Capital Investment Fund Working Capital Fund Operating Expenses, Inspector General Foreign Service Retirement and Disability Fund International Disaster and Famine Assistance Transition Initiatives
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Europe Regional

The CBJ Profile Program Summary Tables Complete USAID/Europe Regional Program Please note: All linked documents are in PDF format Objective SO Number FY 2004 FY 2005 FY 2006 Fiscal Reform 180-0120 239 299 177 Private Enterprise Development 180-0130 821 541 500 Strengthening the Financial Sector 180-0140 789 877 400 Sustainable Energy Systems 180-0150 1,595 1,500 1,500 Better Environmental Management 180-0160 3,259 989 400 Democratic Governance 180-0200   693 1,160 Civil Society 180-0210 1,277     Rule of Law 180-0220 471     Local Government and Urban Development 180-0230 573     Health Promotion and Care 180-0320 2,269 1,390 1,359 Social Sector Reform 180-0340 223 800 450 Cross-Cutting Programs 180-0420 4,799 4,661 5,304 Transfers   21,710 33,327 54,000 Total (in thousands of dollars) 38,025 45,077 65,250

The Development Challenge: USAID's review of country performance, which takes into account over two dozen transition indicators, shows that although considerably beyond Eurasian countries with respect to key democratic, economic, and social transition measures, the Southeast European transition countries lag behind the "northern tier" European countries that have graduated from bilateral USAID assistance. While moving in the right direction, they still face a number of obstacles to reach these reform targets and ensure a sustainable transition. Unresolved ethnic tensions lay below the surface and could easily re-emerge without institutional mechanisms for inter-ethnic understanding and cooperation. Weak labor markets combined with large youth populations pose special challenges, and corruption remains an issue across the region.

Many of the European transition countries aspire to membership in regional organizations such as the European Union (EU) and NATO, and while countries scheduled for EU accession will gain immediate benefits, there may be a cost to those not yet ready for membership (e.g., The Republic of Macedonia, Albania, Kosovo, Serbia and Montenegro, Bosnia and Herzegovina, and Croatia). These entities are small and poorly integrated among one another, and maintaining momentum for reform among them will be particularly challenging.

The USAID Program: The regional program in Europe includes multi-country and region-wide interventions that promote the achievement of bilateral assistance goals, but cannot be easily funded bilaterally. The regional program focuses on three distinct types of activities: 1) analytical efforts which support strategic budgeting and performance monitoring; 2) economic and democracy initiatives which promote regional integration; and 3) Administration priorities and Congressionally-mandated programs, particularly in health such as women's reproductive health and HIV/AIDS prevention.

1. Under sector-specific cross-cutting program support objectives, USAID will carry out an analytical agenda to strengthen strategic budgeting and program effectiveness. Activities will include monitoring and analysis of country progress, implementing a modest regional evaluation program, participant training oversight, carrying out various sector-specific analyses, and maintaining demand-driven regional technical support and training contracts.
2. Economic growth activities support regional infrastructure development and foster innovative approaches to enhancing competitiveness and meeting international standards. Building on the successful Regional Infrastructure Project for Southeast Europe under the Stability Pact, USAID is developing the capacity and sustainability of two legacy institutions it has established: the Balkans Infrastructure Development Facility (a revolving fund to develop public infrastructure in water, transportation and energy), and the Sava River Basin Commission for managing navigation and flood control. In addition, USAID will begin implementing its Balkans Infrastructure Investment Guarantee Fund (applying Development Credit Authority support to private investment in public infrastructure). Other regional initiatives will seek to accelerate financial market integration, promote cross-border trade, increase financial transparency and accountability, and promote the development and use of debt and mortgage instruments. In the energy arena, USAID assistance will support Southeastern European and European Union efforts to create a regional electricity market in Southeast Europe and will support more efficient and reliable energy systems. In democracy, USAID will support the development of independent media, will promote citizens' community participation, will continue to engage civil society in pressing for legal reform, and will promote regional networking among local non-governmental organizations (NGOs).
3. USAID will continue to carry out a number of activities related to social transition. These include efforts directed at infectious disease control (including tuberculosis control), HIV/AIDS, reproductive health, and iodine deficiency. In Southeastern Europe, a cross-border HIV/AIDS initiative will link NGOs to promote safer reproductive health practices. In addition, USAID will continue to support improved access to health through partnerships. To combat trafficking in persons, USAID will support the establishment of a regional anti-trafficking partnership.
4. USAID will also support innovative regional initiatives aimed at fostering reform through strengthening values. USAID awarded grants to qualified organizations to implement innovative ideas that cultivate and strengthen universally recognized values that support USAID goals and objectives in the region. The goal of this initiative is to achieve positive, lasting attitudinal change, reflected in realizing more permanent advancements in social, economic and political practices. Funds in FY 2005 are for the current requirements of the previously approved grants.

Other Program Elements: The Europe regional program complements bilateral assistance programs and does not contain other program elements of its own.

Donors Other donors are discussed in the country overviews of the bilateral programs supported by the regional program.

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