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![[Congressional Presentation]](/images/cp00bnnr.gif)
Summary of USAID Fiscal Year 2000 Budget Request
For Fiscal Year 2000, the President is requesting appropriations of $7,212,000,000 for USAID-administered programs, including those jointly administered with the State Department. The FY 2000 request compares to the FY 1999 appropriation level of $7,092,731,000, which includes $146,000,000 in emergency supplemental funds. The FY 2000 USAID request includes funding for Sustainable Development Assistance (DA), Development Fund for Africa, Child Survival and Disease Programs, the Economic Support Fund (ESF), Support for East European Democracy (SEED), and Assistance for the New Independent States of the former Soviet Union (NIS). P.L. 480 (Food for Peace) resources administered by USAID are formally requested as a part of the U. S. Department of Agriculture budget.The following chart and subsequent descriptions provide further details in support of the budget request. FY 1998 levels include funds transferred to USAID for International Cooperative Administrative Support Services (ICASS). The table is in dollars thousands.
USAID Account
FY 1998 Appropriated Level
FY 1999 Appropriated Level
FY 2000
Budget
RequestDevelopment Assistance (DA)\1 Child Survival and Disease Programs Development Fund for Africa International Disaster Assistance Credit Programs Development Credit Authority \2 USAID Operating Expenses \3 Inspector General Operating Expenses Foreign Service Disability & Retirement Economic Support Fund & International Fund for Ireland \1 & \4 Assistance to the New Independent States \1 Assistance for Eastern Europe and the Baltics P.L. 480 Food For Peace Title II P.L 480 Food For Peace Title III USAID Total:
\1 To be consistent with the FY 2000 request, the FY 1998 and FY 1999 appropriated levels exclude transfers to the African Development Foundation and the Inter-American Development Foundation, but include funds ultimately transferred from SEED and NIS funds to other agencies. FY 1998 account levels also include one-time appropriations for use of Department of State's new International Cooperative Administrative Support Services (ICASS) for services provided to USAID through ICASS.
\2 FY 1998 authority will be used in FY 1999, with FY 1998 funds, pending OMB certification.
\3 FY 1999 includes $2.5 million of ESF being used for operating expenses from the security supplemental, and $10.2 million from the Y2K supplemental.
\4 FYs 1999 and 2000 exclude supplemental requests and advance appropriations related to Wye Accords.
\5 Excludes $50 million of estimated carry-in and recoveries which would permit an $837 million program.
All programs managed by USAID, as noted under the Program Performance section, are an integral part of U.S. foreign policy objectives, particularly in the areas of fostering economic growth and promoting sustainable development; supporting the establishment of democracies and upholding human rights; providing humanitarian and transitional assistance to victims of crisis and disaster; and improving the global environment, stabilizing world population growth, and protecting human health.
SUSTAINABLE DEVELOPMENT ASSISTANCE
The Sustainable Development Assistance account, the Development Fund for Africa, and the Child Survival and Disease Program Fund provide support for activities worldwide that are designed to promote sustainable development in some of the poorest countries in the world. These nations represent the world's last great underdeveloped markets. USAID strongly believes that the modest and well targeted investments it makes today in the form of human capital and the partnerships the agency establishes with the overseas communities will pay economic and political dividends to the United States well into the future. These three accounts constitute the core of USAID's sustainable development programs and support five of USAID's seven strategic goals--- integrated, interrelated and mutually reinforcing goals that are aimed at addressing the long-term interests of the United States. (The sixth goal of humanitarian assistance includes USAID's request for International Disaster Assistance and the Food for Peace accounts. The seventh goal, that USAID remain the premier bilateral development agency, is supported by USAID and Inspector General (IG) Operating Expenses to maintain management of all USAID-managed programs and the goals sought by these programs).
These five goals include activities aimed at promoting broad-based and sustainable economic growth and agricultural development ($460 million); building human capacity through education and training ($148 million); stabilizing population growth rates ($355 million) and protecting human health ($445 million); protecting the environment ($290 million); and strengthening democracy and good governance ($150 million). (USAID's credit programs also cut across many of these goals, as do those of the Central and Eastern Europe and the New Independent States, and some of the programs funded under the Economic Support Fund.)
Sustainable Development Assistance Account
The request for this account in FY 2000 is $780.4 million, and includes funding to address the Asia financial crisis and programs in Latin America that implement the Santiago Summit Plan of Action and a Global Climate Change Initiative related to tropical forest fires. The request includes $224 million for economic growth, $4 million for human capacity development, $78 million to support democratic participation, $192 million for the environment, and $282 million for population programs.
Economic growth funds will expand and strengthen private markets, encourage more rapid and enhanced agricultural development for food security, and provide access to economic opportunity for the rural and urban poor. Scores of nations are making the transition from repressive, autocratic regimes to democratic governance, and some of these funds will help countries build democratic institutions, strengthen the societal underpinnings essential to success, and move toward more open and representative governments. Funding for environmental programs will help reduce the threat of global climate change, conserve biological diversity, provide for sustainable urbanization and pollution control, increase environmentally sound energy services, and promote the sustainable management of natural resources. Funds for family planning activities will help reduce unintended pregnancies, improve infant and child health and nutrition--while reducing their mortality rates--and decrease maternal deaths associated with childbirth through better access to improved obstetrical services.
The Santiago Summit, held in April 1998, has again set the pace for development initiatives in Latin America and culminated a year-long effort of Presidential engagement in hemispheric affairs. These initiatives focus on a "second generation" of reforms aimed at deepening the trend toward democratic governance in the region and removing the barriers to the participation of the poor in the national life of their countries. USAID is designing several new initiatives that will be more in sync with Summit goals and objectives -- in the areas of education, microenterprise, property registration, food safety, government decentralization, judicial training, anti-corruption and child labor. Basic education and child labor activities will be funded under the Child Survival and Diseases Program Fund.
The recent financial crisis in Asia has had a global impact, resulting in falling commodity prices and reduced world demand for exports, which threatens the economic progress in fragile regions. This crisis represents a significant setback in long-term efforts to strengthen trade and investment linkages between U.S. and Asian business. USAID has an important role in helping Asian countries address the root causes of the crisis, especially through economic growth and democracy and governance activities. Increasing competition, transparency and accountability in capital markets and other financial sector institutions remains the focus of USAID activities. USAID also is working to liberalize international trade, increase the degree of competition within domestic economies, eliminate restraints on foreign and domestic investment, and privatize infrastructure. Needs of the poor are being addressed through programs that strengthen microenterprise finance institutions, transfer improved technologies and practices to business and agriculture, and strengthen civil society.
USAID's programs address the primary causes of social instability and underdevelopment by joining in partnership with the governments and citizens of host countries to address mutually identified problems. Development is sustainable when it permanently enhances the capacity of a society to improve its quality of life. Thus, while addressing problems in any one of USAID's five major goals, the agency also can achieve progress in the other areas. This is because USAID programs aim at increasing participation and empowerment; the impact of our activities is felt far beyond any one specific development problem. USAID programs help increase the participation of people at all income levels, with special emphasis on women and ethnic minorities, in the economic, social, and political processes in order that they may contribute to and benefit from national progress. Sustainable development also creates lasting trade and social linkages between the United States and the developing world.
USAID is renewing its request for a separate appropriation for the Development Fund for Africa (DFA) as a reflection of the high priority this Administration places on aiding the sustainable development of Africa. The FY 2000 request for this account is $512.6 million. Within this request is $235 million for economic growth and agricultural development, $34 million for human capacity development (other than basic education), $73 million for population programs, $99 million for sustained management of the environment, and $72 million for building democracy. Within the DFA request is $45 million for an expanded African Food Security Initiative, a ten-year initiative announced by President Clinton during his 1998 trip to Africa. In addition to the DFA, Africa will receive $252 million from the Child Survival and Diseases Program Fund and $73 million from the Economic Support Fund. The total request of $818 million under all these accounts permits the Administration to meet the President's commitment to seek a return to historically high levels.
Two policy goals define U.S. foreign policy in Africa: accelerating Africa's full integration into the global economy and combatting transnational security threats. The United States cannot afford to ignore Africa -- either as a source of threats or as a significant and growing investment opportunity. The fundamental development challenge facing Africa is its extreme poverty. USAID recognizes, moreover, that broad-based, equitable development diminishes the potential for conflict, promotes political stability and builds more prosperous nations. Agriculture is the priority sector for investment to stimulate the rapid economic growth Africa requires to attack food insecurity and malnutrition; the Africa Food Security Initiative addresses this issue. The Africa Trade and Investment Policy Program provides assistance to help reform-oriented African countries improve the environment for trade and private investment, catalyze relationships between U.S. and African firms through business linkages, and help finance implementation of aggressive market-friendly reforms. The African Great Lakes Justice Initiative seeks to break the cycle of violence in the region by building credible, impartial civilian and military justice systems while bolstering ethnic reconciliation.
Child Survival and Disease Programs
The FY request for this account is $555 million and includes $445 million for child survival, HIV/AIDS, infectious diseases and health promotion; and $110 million for children's basic education. These funds support the U.S. foreign assistance objectives of economic development (in terms of human capacity development) and protecting human health and reducing the spread of infectious diseases. Programs covered under this account are important forerunners of efforts to support economic growth and stability, as well as being a necessary adjunct to family planning efforts. The request funds USAID's efforts in child survival and maternal health, HIV/AIDS, infectious diseases, promoting improved health in developing countries, and basic education.
Child survival ($236 million): USAID's child survival program is aimed at improving infant and child health and nutrition and reducing infant and child mortality. Along with broader health sector resources described below, USAID is also working with partners to reduce deaths, nutritional insecurity and adverse health outcomes to women as a result of pregnancy and child birth. Reducing maternal mortality is a critically important intervention for improving child survival; the children of mothers who die in childbirth are much more likely to die themselves, or suffer health and development problems. Improved nutritional status for young women and mothers is also extremely important for reducing low-birth weight babies, a key risk factor for deaths in the first month of life.Specific interventions for child survival include working with host country partners to develop the capacity and systems to address the major causes of mortality among children in the developing world; improve nutritional status, including micronutrients with increased attention to eliminating vitamin A deficiency; improve maternal health and nutrition; and develop more effective and efficient approaches to improving child health and survival.USAID's child survival request also includes $25 million for the Polio Eradication Initiative. Efforts continue to be focused on South Asia and Africa, and include accelerated efforts to strengthen surveillance, so that eradication certification can proceed as planned.
HIV/AIDS ($127 million). USAID is the leading bilateral donor in HIV/AIDS prevention, working to reduce HIV transmission and the impact of the HIV/AIDS pandemic in developing countries. Almost half of USAID's HIV/AIDS resources are focused on Africa, where the HIV/AIDS epidemic is most severe, with increasing attention to Asia, where the epidemic is spreading rapidly, and to Latin America. USAID is also a key supporter of the United Nations Program on HIV/AIDS (UNAIDS).USAID's strategy for HIV/AIDS is centered on developing methods to reduce the risk of exposure to HIV; reduce sexually transmitted infections (STIs); communication campaigns to change behaviors and promote condom use; policy dialogue and public awareness campaigns, particularly in countries in which HIV/AIDS is already a public health problem or where behavioral and epidemiologic patterns suggest the potential for a severe epidemic; and data collection to quantify and monitor the evolution of the HIV/AIDS epidemic and the impact of interventions on risk behaviors and HIV transmission. USAID also works with developing country partners to help communities care for those affected and infected by HIV, and has pioneered efforts to assist children orphaned by HIV/AIDS.
Infectious diseases ($50 million). In FY 2000, USAID will continue its efforts to reduce the threat of infectious diseases of major public health importance. Working in close collaboration with international, U.S. and developing country partners, USAID's efforts are focused on reducing the spread of antimicrobial resistance; improving control of tuberculosis; reducing mortality due to malaria and other diseases; and improving disease surveillance and response capacity.Health promotion ($32 million). Critical to the achievement of specific objectives in child survival, HIV/AIDS, and infectious diseases are efforts that are typically described as "general health promotion." These include health care policy reform, health care financing, environmental health activities that are not necessarily child-specific but critical for improvements in health, building nongovernmental organization (NGO) health service capacity, and building public and private partnerships for health care. Some of these funds are also used to support maternal health interventions, including nutrition, early detection and management of serious obstetric complications and emergency obstetric care, and promotion of safe delivery by trained personnel.
Basic education ($110 million). USAID's basic education for children program works to strengthen pre-primary, primary, and secondary education and teacher training. Efforts are focused primarily in Africa, but also include targeted work in Asia, the Near East and Latin America.
Maternal health. While not a specific funding subcomponent of the Child Survival and Disease Programs fund, USAID expects to spend approximately $50 million for improving maternal health and reducing deaths to women as a result of pregnancy and child birth. More than 580,000 women die each year from pregnancy related causes, and more than half of their infants also die as a result. In addition, each year, 15 million women suffer painful and debilitating pregnancy-related injuries and infections. USAID will work with international partners and host country governments to ensure that there is commitment at all levels to address this devastating problem. Efforts will focus on a set of key interventions that mark the pathway to maternal survival, including improving maternal nutrition; birth preparedness; treatment of complications; and safe delivery, postpartum and newborn care.
USAID's credit programs address a variety of development objectives, including economic development, securing a sustainable environment, achieving a sustainable world population, and protecting human health.
USAID believes there are significant instances in which development priorities can be best funded through credit, especially in emerging market countries and in countries moving toward graduation status. Credit resources permit the leveraging of private sector resources to support sustainable development and to enable USAID to reach populations it would not otherwise be able to reach. These programs enable people to feed themselves and their families better, educate their children, improve their health, and upgrade their housing standards. Ultimately, the goal of all USAID credit programs is to allow the citizens of the developing world to concentrate on something beyond their next meal and to free up economic growth potential of the next generation of U.S. economic partners.
USAID's credit guarantee programs include the Micro and Small Enterprise Development Program, the Urban and Environmental Credit Program (formerly the Housing Guaranty program), and a request for authority to transfer up to $15 million for the Development Credit Authority program from the accounts of Sustainable Development Assistance, Support for Eastern Europe Democracy (SEED), and New Independent States (NIS). Micro and Small Enterprise Development Program. This program requests appropriations totaling $2 million -- $1,500,000 for credit subsidies and $500,000 for program administration. The program uses loans and guaranties to encourage financial institutions to extend and expand credit to microenterpreneurs and small businesses. The Micro and Small Enterprise Development program is a grassroots program designed to help poor people, especially women, create employment for themselves, acquire incomes, build assets and join in the strengthening of the formal sector of the economy. Microenterprise and small loan programs provide the bridge to society for the poor, who until now have had no real connection to the economic mainstream.
Urban and Environmental Credit Program (formerly the Housing Guaranty Program).
This USAID program extends guaranties to U.S. private sector investors who make loans to developing countries to support the formulation and implementation of sound housing and community development activities. These activities are targeted exclusively to meet the needs of lower income groups in the assisted country with an emphasis on addressing the urban and environmental problems that impair human health, decrease child survival rates and prevent economic growth. The FY 2000 request for these activities totals $3,000,000 for subsidies and $5,000,000 for program administrative costs to administer a $2.5 billion loan portfolio.Development Credit Authority. The Development Credit Authority (DCA) provides the USAID with an important and timely tool to address its strategic priorities. It will leverage agency resources more effectively through the use of market rate loans and guarantees to finance sovereign and non-sovereign development projects that are both developmentally sound and creditworthy. This authority assumes special importance in supporting efforts related to global climate change. The DCA will leverage $50 million in credit-funded resources to support the GCC initiative. Budget authority is being requested to transfer up to $15 million in FY 2000 from DA, SEED and NIS accounts, of which up to $2 million would be for administrative expenses. International Disaster Assistance
USAID requests $220 million for this program which includes $165 million for disaster relief managed by the U.S. Office of Foreign Disaster Assistance (OFDA) and $55 million for transition assistance programs managed by the Office of Transition Initiatives (OTI). USAID has a new responsibility for coordinating the U.S. Government response capability and incident command system in the field of emerging threats and will also provide $5 million to assist overseas victims of nuclear, biological and chemical incidents.
An integrated approach to humanitarian assistance -- emergency relief, prevention and transition -- reduces suffering and the need for future aid.
The United States' ability to respond rapidly to emergencies is already known worldwide. Disaster assistance funds are used to improve the capacity of foreign nations to prepare and plan for disasters, mitigate their effect, and teach prevention techniques that increase the skills available locally to respond when disaster strikes. OFDA also fields disaster assistance response teams (DARTs); for example, after Hurricane Mitch, USAID established a DART to coordinate the entire $300 million U.S. Government relief effort.
OTI funds underwrite recovery efforts for countries emerging from complex crises. OTI activities focus on special post-crisis needs not addressed by either emergency relief or long-term development programs -- support for demobilization and reintroduction of excombatants into civilian society; support for justice initiatives including war crimes tribunals; landmine awareness and removal; and community self-help projects that reduce tensions and promote democratic process and conflict resolution within communities. These efforts are designed to help nations return to the path of sustainable development, prevent crises from becoming more impacted, and minimize the need for future, ongoing humanitarian and disaster relief.
The appropriation for USAID Operating Expenses covers the salaries and other support costs associated with the operations of USAID worldwide, including those managed by USAID and financed through Development Assistance, Disaster Assistance, the Economic Support Fund, the Support for Eastern European Democracy Act, the Freedom Support Act and the Food for Peace program. Operating Expenses for USAID's Inspector General, and the costs associated with the administration of USAID's credit programs are requested separately, as discussed above.
The FY 2000 request is $507.7 million. This request includes $7.7 million associated with the Office of Security, which is being transferred from the Office of the Inspector General to the Office of the Administrator in FY 1999 in accordance with the FY 1999 Omnibus Appropriations Act.
USAID will continue its efforts to reduce costs, in part through continuing staff reductions worldwide and consolidating administrative and program support functions for overseas operations into additional "support" missions. Further improvements in efficiency will be emphasized as the agency continues to work on its automated systems and efforts to ensure all critical systems are Year 2000 compliant.
Inspector General Operating Expenses
This appropriation for Inspector General Operating Expenses covers salaries and other support costs associated with USAID's Inspector General operations worldwide. Activities covered include audits and investigations relating to USAID's worldwide programs and operations. The Office of Inspector General (OIG) has reduced the number of supervisors, managers, and Senior Foreign Service designated positions as well as overall staffing levels worldwide in past years.
The request of $25.3 million covers both the domestic and overseas operations of USAID's Inspector General. The budget request reflects a reduction from prior year levels because the functions of the Office of Security are being transferred from the OIG to the USAID Administrator in FY 1999.
Foreign Service Retirement and Disability Fund
These funds cover the mandatory costs associated with the inclusion of USAID Foreign Service employees in the fund. The FY 2000 request is $43.8 million.
The Economic Support Fund advances economic and political foreign policy interests of the United States. To the extent feasible, the use of ESF conforms to the basic policy directions underlying our sustainable development assistance. ESF can finance balance of payments and economic stabilization programs, frequently in a multi-donor context.
The FY 2000 request of $2.389 billion will be used to support the Middle East peace process ($1.943 billion), assist countries in transition such as Haiti and Cambodia, support democracy efforts worldwide, as well as several initiatives in Africa, and promote peace and stability in such countries as Ireland and Cyprus. Support for democracy will be provided through assistance with elections, political party building and legislative training. Funds will also be used to respond to emerging environmental crises and priorities, including climate change and biodiversity. Funding will continue to support the Holocaust Fund and the Human Rights Fund, and will support a new "No Sweat" Initiative to help eliminate abusive child labor practices overseas. (Note: This request excludes the supplemental being requested by the Administration in connection with implementation of the Wye Memorandum to support Middle East peace.)
SUPPORT FOR EAST EUROPEAN DEMOCRACY
This funding supports activities authorized under the Support for East European Democracy (SEED) Act of 1989. SEED is a transitional program designed to aid central and eastern European countries through their passage to democracy and market economies. These programs help establish competitive market-oriented economies, build democratic institutions and establish linkages to the democracies of the west, and help sustain the neediest sector of the population during the transition period. As countries consolidate their political and economic transitions, they will be graduated from the assistance category and funding for bilateral SEED programs will be phased out. USAID will move to develop new kinds of partnerships fostering ties between the United States and graduate countries (Slovenia, Estonia, the Czech Republic, Lithuania, Poland and Slovakia), such as the Baltic-American Partnership Fund already up and running. The FY 2000 request is $393 million, including $175 million for Bosnian reconstruction and judicial reform, and $218 million for other countries in the Northern and Southern Tiers, with $50 million for Kosovo. There will be a shift of program activities from "graduating" Northern Tier countries to Southern Tier countries that have further to go in their economic and political transformation.
ASSISTANCE TO THE NEW INDEPENDENT STATES OF THE FORMER SOVIET UNION
These funds support the activities established under the Freedom Support Act. USAID's assistance supports the fundamental U.S. foreign policy goals of consolidating improved U.S. security, building a lasting partnership with the individual New Independent States (NIS) and providing access to each other's markets, resources and expertise. The FY 2000 request is $1.032 billion, of which $241 million is for a new Expanded Threat Reduction Assistance Initiative aimed at dealing with reducing crises associated with weapons of mass destruction not administered by USAID. The NIS region has been hit hard by the Russian financial crisis, following on the heels of the Asian financial crisis. The principal challenges at present lie in rebuilding support for democratic and economic reforms, putting the NIS economies on a firmer growth track, helping those most materially affected by the crisis, and ensuring the continued viability of independent, democratic institutions and the media.
P.L. 480 FOOD FOR PEACE PROGRAMS
USAID's Food for Peace programs (P.L. 480) provide both humanitarian and sustainable development assistance in the form of U.S. agricultural commodities. In addition, P.L. 480 also funds the farmer-to-farmer exchange program and a grant program to U.S. private voluntary organizations and cooperatives implementing P.L.480 activities. Although requested by the Department of Agriculture, PL 480 Titles II and III are administered by USAID.
Title II provides resources to U.S. private voluntary organizations (PVOs) and the World Food Program to help implement sustainable development programs targeted to improve the food security of needy people, either by the direct distribution of agricultural commodities or the use of local currencies generated by the sale of these commodities in the recipient county. Title II also provides the vast majority of U.S. food assistance used to respond to emergencies and disasters around the world. The FY 2000 request is $787 million; however, this excludes $50 million of estimated carry-in and recoveries of prior year balances which would permit an $837 million program.
The Title III Food for Development program provides country-to-country grants of agricultural commodities to improve food security and to promote agricultural policy reforms that encourage food production. There is no request for Title III for FY 2000 due to budget constraints and a higher priority placed on funding other U.S. foreign assistance activities, particularly sustainable development assistance.
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