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FY 1997 Development Fund for Africa: $11,427,735
FY 1997 P.L. 480 Title II: $ 3,700,000
Introduction .
Eritrea is Africa's newest nation. Eritrea formalized its independence from Ethiopia by popular referendum in 1993 after a costly 30-year struggle. The long struggle for independence left Eritrea with a neglected and devastated physical and institutional infrastructure; however, it also forged a strong determination to build a self-reliant new nation, economically and politically. It is a small, arid and rugged country located north of the Horn of Africa along the southwestern coast of the Red Sea neighboring Saudi Arabia, Sudan, Ethiopia, Djibouti, and Yemen. Its multi-ethnic population (divided equally between Muslim and Christian religions) is estimated at three million. Even though predominantly rural and agro-pastoral, Eritrea is important to U.S. interests because it possesses major trade routes and Red Sea ports and islands. Eritrea's two deep water ports and shipping lanes in the Red Sea and the size and volatility of its neighbors give it strategic importance in the Mideast and Horn of Africa region. It is also a principal life line for humanitarian assistance to the Horn region, where war and famine recently threatened 25 million people.
Its income-producing natural resources include deposits of gold, copper, gas and oil, a large marine fishery, salt flats, broad grazing land, and potential tourist sites.
Eritrea's primary economic goals are rebuilding energy and transportation infrastructure, establishing sustainable education, health and pension systems, developing a broad-based private sector, and promoting foreign investment. Foremost among its political goals are a strong local and national government, a democratic constitution, and revitalized regional structures. The successful reintegration of ex-combatants and refugees has also been an important concern.
Eritrea presents a unique, determined effort to develop a stable society and self-reliant, broad-based economy in a region characterized by political extremes, instability, and collapse. USAID assistance to Eritrea supports U.S. interests by promoting both the recovery and growth of a market-based economy and the emergence of democratic governance to underpin national stability in this historically volatile region.
The Development Challenge.
Eritrea's severe poverty has been exacerbated by decades of war. Even by African standards, Eritrea's health and nutrition indicators are poor. Infant mortality is 135 deaths per 1,000 and under-five mortality is 203 deaths per 1,000. Life expectancy is approximately 46 years. The population growth rate is a high 3%.
Most Eritreans depend on agriculture for their survival, but Eritrea's northern location in the erratic Sahelian rainfall zones limits foodgrain production. There are opportunities for export crop production, however. Food security is constrained by difficult physical conditions as well as a lack of income due to a paucity of enterprise. The capabilities of government and the private sector, notwithstanding dedicated personnel, are limited by a lack of education, training, and experience.
Despite these constraints, the potential for rapid rebuilding and development in Eritrea is high. The country was once the most industrialized in Africa and has the legacy of a hard-working labor force and good public and private management. Its location at the crossroad of the Middle East and Africa is advantageous to trade. Eritreans are united in their commitment to rebuild their country, and considerable remittances from Eritreans abroad demonstrate it.
A careful steward of limited resources, the new government is determined to build a new nation avoiding the mistakes of other African countries. With no country debt, a commitment to the principles of an open economy, and progress made in attracting foreign investment, Eritrea could achieve self-reliance within a decade.
Eritrea's leadership looks to East Asia rather than to Africa or the West for its development models. It is strongly supportive of (and a key participant in) the Greater Horn of Africa Initiative (GHAI) and the principles of African leadership, regional integration, conflict prevention, and food security. Given its strategic position geopolitically and in terms of trade and the high potential for instability in neighboring states, strong support of Eritrea's determined effort for self-reliance is in the U.S. national interest in the region.
USAID has been successful in helping Eritrea resolve two of the most sensitive issues in the region: the demobilization of thousands of ex-fighters and the resettlement of tens of thousands of refugees and internally-displaced through provision of considerable food and agricultural inputs. Recognizing that a healthy, productive population is Eritrea's most important resource, USAID also initiated a broad program to strengthen its primary health care system. Most recently, USAID is providing training and institutional partnerships linkages to build democratic governance and private enterprise.
Other Donors .
A formal mechanism for donor coordination is not yet established in Eritrea, and there has not been a Consultative Group meeting for Eritrea since 1994. Overall donor assistance for 1995 was on the order of $150 million, of which the United States provided about 12%. Italy, Germany, the European Union (EU), and the United States, respectively, are currently the largest donors. The Scandinavian countries, the United Nations Development Program (UNDP), and the United Nations Children's Fund (UNICEF) also have sizeable assistance portfolios. The World Bank has recently negotiated its first major loan--a community development fund--and is considering loans for regional hospitals, primary education, and port rehabilitation.
USAID has been effective in collaborating with the World Bank, UNDP, and UNICEF in strengthening Eritrea's health system and building administrative and financial management capabilities. In the last two months, USAID was particularly successful in facilitating multi-donor concern leading to a major reform of food policy in Eritrea.
FY 1997 Program .
Supportive of U.S. interests and the GHAI, USAID's strategy is to help Eritrea achieve its goal of self-reliance within a decade. This will involve, above all, building the human capital and key institutions which underpin successful nationhood. Of particular concern are those problems which involve the most acute human need and the potential for crisis such as chronic food deficits, debilitating health problems, and limited government capabilities -- problems which are worse in the predominantly Muslim, and potentially destabilizing, lowlands.
To respond to Eritrea's determination and needs, USAID is entering into a "development partnership" with the Eritrean government to improve rural food security, mother and child health, and democratic governance. Food security was the earliest area of USAID involvement due to the large amounts of P.L.480, Title II assistance and agricultural inputs provided to assist the post-conflict recovery, demobilization, and resettlement. USAID plays a major role in dialogue on food policy and supports several smaller agricultural production-enhancing activities.
Last year, USAID initiated considerable health and population assistance which is now focused on primary health care services in the central zones of the country. Most recently, in response to thegovernment's expressed needs, USAID launched a sizeable governance capacity-building effort through university, management institute, constitutional commission, and ministerial training.
Agency Goal: Encouraging Broad-based Economic Growth
With Eritrea's liberal investment climate and a tradition of (and location for) commerce, the prospects are good for rapid economic growth in Eritrea's urban areas and their trade corridors. However, rapid growth in these areas without complementary growth and linkages in lowland, predominantly Muslim western areas of the country would leave half the population in poverty with likely destabilizing effects. Physical conditions also limit food production in these lowland areas.
Thus, consistent with U.S. economic interests and the GHAI, USAID's primary strategic objective in Eritrea is to help make food more available in these rural areas through increased enterprise and trade. USAID is building on the experience of its food and agricultural assistance--for example, breeding livestock for dispossessed farm households--to stimulate rural income growth. A combination of bilateral and GHAI resources are being programmed to support the formation of rural associations, cooperatives, and enterprises, and thus expand rural income and trade.
USAID assistance has contributed to several important achievements towards national and household food security: the successful repatriation of tens of thousands of refugee families from Sudan and the demobilization of thousands of ex-fighters; limiting the locust damage to the 1995 grain harvest; and spurring a shift away from government food handouts in order to create a cash food economy and safety net. Notwithstanding these achievements, Eritrea remains critically and structurally food deficient.
The primary guarantor of food security in Eritrea will be a robust and diversified rural economy. To have any catalytic impact on rural economic growth, even in selected areas of Eritrea, considerable resources will be needed for pilot interventions over the next several years.
Agency Goal: Stabilizing World Population Growth and Protecting Human Health
The indicators for maternal and infant mortality in Eritrea are among the worst in the world. A generation of neglect and war had obliterated health services in Eritrea. Due to relatively greater inaccessibility, traditionalism, and endemic diseases (e.g., malaria), maternal and child health is generally poorer in the predominantly-Muslim lowlands than in other areas of the country. This situation results in debilitation of the family, continued high rates of fertility, and increasing (and potentially destabilizing) disparities between regions.
USAID is responding to this dire situation by helping the government build an effective health care system. Specifically, USAID's special objective is improved access to sustainable, integrated primary health care services mainly for rural women and children. Through its broad health and population program with the Ministry of Health (MOH), and several grants to U.S. private voluntary organizations (PVOs) and UNICEF, USAID assistance will improve health care services and delivery. USAID also provides assistance to the logistical, management, and financial systems which support these services, along with increasing the awareness and demand for health care services by target groups.
While USAID has only provided assistance in this sector since last year, several results are already evident. USAID assistance enabled an expansion of child immunization. USAID-sponsored studies and technical assistance have enabled the MOH to streamline its staffing, initiate cost recovery for services, and upgrade the capabilities of the nurse practitioners who service rural health stations. To better achieve and assess its impact on a widespread rural health sector, USAID assistance is being focused in three rural zones. While disbursement of USAID assistance has been slow, primarily due to a lackof professional staff, substantial expenditures on technical assistance, training, and commodities are anticipated in 1996.
Since the popular referendum in 1993 to affirm the Eritreans' desire for independence from Ethiopia, Eritrea's leadership has moved convincingly, if cautiously, toward the establishment of democratic structures of government. While the government retains some tendencies towards authoritarianism, centralization, and distrust -- due in part to the proceduralism inherited from the earlier dictatorship and in part to the newness of government administration to former fighters -- the commitment to democracy is strong among those who fought for independence. This commitment is demonstrated by recent steps taken to ensure public education and debate on a constitution (with representative elections scheduled for 1997) and to strengthen local government and the judiciary.
USAID, in support of U.S. political interests and in close collaboration with the Embassy, the United States Information Service and the UNDP, has initiated a substantial "governance capacity-building" effort to support and reinforce the establishment of a democratic government in Eritrea. The focus of this effort is training at all levels: a university linkage to build the faculties of law, public administration, journalism, and political science; grants to enable broad education and outreach by the Constitutional Commission; cost-sharing for the establishment of an Eritrean management institute; in-country training for judges and local officials; and a broad participant training program. This broad effort, and the possibility of additional assistance to establish a legislature, indigenous non-governmental organizations, and other elements of a democratic system, will require significant--if incremental--funding over the next several years.
Although USAID's efforts in this area are relatively recent, intermediate results are already evident: a training agreement between a major American university and Eritrea's only university, and a broad and successful outreach effort by the Constitutional Commission. Nevertheless, USAID involvement in the democracy-building process in Eritrea can be sensitive, particularly to its proud and determined leadership. Thus, USAID must continue with a range of capacity-building assistance over a broad front and often through intermediaries such as the UNDP. This broader approach also requires adequate and skilled USAID staffing.
Agency Goal: Protecting the Environment
Eritrea faces the environmental degradation common to many countries in Sahelian Africa: deforestation, marginal land agriculture, unprotected coastal resources, urban sprawl, etc. The new Eritrean government is keenly aware of these problems and has taken actions primarily through the Ministries of Agriculture and Marine Resources to mitigate them. These actions include large-scale reforestation and watershed treatment, research on and policing of coral reefs, and environmental education, planning and assessments.
While USAID has not defined a specific objective for environmental protection in Eritrea, the Strategic Objectives for food security and governance support this goal. U.S. food assistance has provided resources for considerable conservation work in upstream watersheds, improvements in food systems, whether actual production or storage, while taking pressure off of marginal lands. Local organizations and cooperatives provide a grassroots institutional structure for environmental awareness, planning and protection.
Governance activities are particularly supportive of environmental protection. Increasing knowledge and professionalism in law, journalism, and public administration will improve understanding and resolution of environmental issues. Building capacity of government officials in key ministries (including Agriculture and Marine Resources) through short and long- term training will improve the capabilities of those ministries.
Two successes are already evident: The Ministry of Marine Resources has been able to effectively protect coastal areas from overfishing; and the Ministry of Agriculture and targeted farmers have reduced per hectare application of locust control pesticides by 15%. Both achievements were largely due to USAID-funded training.
Agency Goal: Providing Humanitarian Assistance
Until recently, Eritrea needed and was a recipient of considerable humanitarian assistance ($49 million from the United States. in 1993-94) to help sustain its population after the war and through a drought year. Eritrea is now completing this transition from emergency to development. Emergency Title II food aid is used for ongoing refugee repatriation and resettlement, a crucial component of Eritrea's transition to a stable and self-reliant society. USAID's regular Title II food assistance, as discussed above under Economic Growth, is now focused on helping Eritrea achieve food security over the longer term, as the need for emergency food assistance decreases. Nonfood humanitarian assistance has been effectively utilized to control locust outbreaks at their inception, a threat to food security, not only for Eritrea, but also for the entire Horn region.
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Environment |
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| USAID Strategic Objectives | ||||||
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Special 1: Primary Health Care for Women and Children - Dev. Fund for Africa |
3,511,946 |
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3,511,946 |
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1. Increased Rural Income Through Growth of Rural Enterprise in Target Areas - Dev. Fund for Africa - P.L. 480, Titles II |
6,067,349 |
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1,260,587 |
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3,700,000 |
7,327,936 |
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2. Increased Capacity for Democratic Governance - Dev. Fund for Africa |
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587,853 |
587,853 |
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Totals - Dev. Fund for Africa - P.L. 480, Title II |
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3,511,946 |
1,260,587 |
587,853 |
3,700,000 |
11,427,735 3,700,000 |
PROGRAM: ERITREA
TITLE AND NUMBER: Improved Access to Primary Health Care Services, 661-SP01
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1997: $3,511,946 DFA
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2000
Purpose: To improve access to integrated primary health care services in focus regions through high quality services delivery; effective information, financial, logistical, and personnel systems; and increased awareness and utilization of the services by families.
Background: Maternal, child, and infant mortality rates are extremely high in Eritrea due to poverty and ignorance, and the deterioration of health infrastructure during the war. However, the independence movement proved adept at initiating health services in the field with "barefoot doctors" and minimal technology. The government is institutionalizing this approach in rebuilding the primary health care system. In 1994, USAID developed a major bilateral project and has since approved grants to U.S. private voluntary organizations (PVOs) and to the United Nations Children's Fund (UNICEF) to provide technical specialists, training, equipment, and renovations to assist the government in establishing an effective and sustainable primary health care system with a concomitant awareness and demand among local communities for the services delivered. The magnitude of the health problems, the number of donors, PVOs, and interested parties involved, and the limited capacity of a recently-downsized Ministry of Health (MOH) have complicated the start-up of USAID-funded activities.
USAID Role and Achievements to Date: Although there are many donors and PVOs assisting Eritrea in the health sector, USAID is now the MOH's primary donor-partner. USAID is providing the critical inputs necessary for MOH and associated organizations to develop effective and sustainable primary health care. Achievements to date include a 30% expansion in child immunization, the streamlining of central MOH staffing, and an increase in service fees to cover, in a first phase, from 1% to 25% of total costs.
Description: The major activity to achieve this Objective is the $15 million Eritrea Health and Population Project. This project provides nine person-years of specialized assistance, 300 person-months of training, supporting vehicles (12), medical and office equipment with related supplies, and selected building renovations. These inputs, primarily for the MOH but also for women and youth groups, will be concentrated in the three central-west zones of the country over a period of five years. They will enable the development of the requisite management systems, institutional structure, technical capacity, and client awareness for effective and sustainable primary health care. This project is supplemented by several grants to U.S. PVOs and one to UNICEF to support smaller, complementary activities that improve individual health centers in rural areas, provide iodization facilities for the salt industry, and expand vaccination coverage. The MOH's cautious use of resources, prudent recurrent costs, and cost recovery policy ensures sustainability of these activities. The substantial capital investment in building and equipping new rural health care facilities by the government and other donors will also contribute to achieving this Objective.
Host Country and Other Donors: The MOH provides the total cost of its central and local staff, as well as salaries for medical staff at health centers and stations. The MOH also covers the major portion of its other operating costs. Several donors -- Germany, Italy, the European Union, and the World Bank -- provide concessional funding to build health facilities, particularly in the rural areas. Several international PVOs with whom USAID maintains close contact (e.g., Save the Children and Christian Outreach) provide assistance for the improvement and operation of individual rural health facilities. USAID has established close collaboration with the World Bank to facilitate a $10 million loan for regional hospitals and regional planning which will complement USAID's assistance in the central-western zones.
Beneficiaries: Approximately 1,000,000 mothers and children under five in the central-western zones are the primary direct beneficiaries of these activities, although it is expected that these activities will have nationwide impact, benefitting an additional 500,000 mothers and children.
Principal Contractors, Grantees, or Agencies: Basic Support for Institutionalizing Child Survival and Family Planning Service Expansion And Technical Support (SEATS) Consortia, Macro International, Africare, World Vision, International Eye Foundation, and UNICEF.
Major Results Indicators:
PROGRAM: ERITREA
TITLE AND NUMBER: Increased Rural Income Through Growth of Rural Enterprise in Target Areas, 661-S001
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1997: $7,327,936 DFA; $3,700,000 P.L. 480, Title II
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2005
Purpose: To increase the ability of the rural population to access food in targeted rural areas through increased production, external trade, marketing, and distribution.
Background: Eritrea suffers from chronic food deficits and subsistence-level agriculture. Accordingly, for a country with a large rural population, agriculture contributes a surprisingly small share to national income: about 25%. Nevertheless, it is the source of sustenance and livelihood for almost three-fourths of the population, and thus, is of critical importance to the rural economy. With a view to this importance, USAID has, since 1993, provided significant amounts of food and agricultural assistance to sustain the livelihood of rural populations (particularly demobilized fighters and returning refugees) affected by the war and, later, drought.
The experiences gained from this assistance and USAID's considerable expertise with food aid and agricultural development led to the support of a number of other food and agriculture-related activities requested by the Ministry of Agriculture (MOA) and the Eritrean relief and rehabilitation agency (ERREC). While USAID assistance will not be able to have a substantial effect on large-scale foodgrain production, there are opportunities for USAID assistance to make a significant difference through the support of catalytic intervention and dialogue in several critical areas of the rural economy, including food policy analysis, crop protection, storage and processing, horticultural development and the formation of associated organizations, enterprises, and cooperatives. The linkage with the food security objectives and activities in the Greater Horn of Africa Initiative (GHAI) will be important. The use of P.L.480 food resources, combined with small amounts of Development Fund for Africa, have proven particularly effective as demonstrated by USAID-supported food monetization and the changes in government food aid policy. Nonetheless, the sector is large and subject to multiple physical variables such as weather and pestilence, complex socioeconomic interactions, and severe resource constraints.
USAID Role and Achievements to Date: USAID is a small, but key donor in the improvement of rural food security. When faced with critical issues, Eritrean decision-makers often request USAID support, most recently in locust control and food monetization policy. USAID assistance has facilitated the repatriation of 25,000 refugees from Sudan and provided livestock, seeds and tools which enabled 2,500 resettled refugee families to earn a livelihood. USAID-funded training and supplies helped contain a massive locust infestation to only 20% of the area planted this year, likely saving as much as a quarter of the grain harvest. USAID support has also enabled ex-fighters (55 women and 70 men) to develop food and agricultural enterprises. Finally, U.S. food assistance provided supplemental nutrition to approximately 200,000 needy beneficiaries -- about one-third of the most vulnerable rural households. USAID dialogue also spurred a major shift in Eritrea's food policy away from distortive feeding programs and towards monetization and targeted cash benefits.
Description: USAID has supported a range of diverse activities to help Eritrea achieve food security. These have included large USAID-Office of Foreign Disaster Assistance and Economic Support Fund grants ($6.7 million) for construction, agricultural inputs and equipment, and other assistance in support of the government's resettlement and demobilization programs; P.L.480 Title II monetization grants ($9.5 million) to two U.S. private voluntary organizations for agricultural and school projects; a number of pilot activities to test micro-enterprise and irrigated farming models; and several centrally-funded collaborative researchand training grants to resolve agricultural problems. USAID's assistance is now being focused on rural enterprise and trade in the central-western zones of Eritrea. The new activities currently being designed will build on the previous activities. Resources will be used to support the formation of rural associations, cooperatives, and enterprises involving food production, processing, storage and marketing; associated policy formulation; and local currency costs.
Host Country and Other Donors: Eritrea has mobilized considerable domestic and external resources for projects and imports to improve food security. Several donors, including Germany, Italy, the European Union (EU), and the World Bank are also providing considerable concessional assistance for rural road and agricultural development projects. Due to the number of donor-assisted activities in rural areas and the lack of any formal coordination mechanism, USAID has collaborative working relationships with other donors in the areas of food policy (EU) and irrigated farming (Israel). While USAID is now a comparatively small donor, it retains an importance due to its previous large-scale food assistance and the effectiveness of several of its current assistance programs.
Beneficiaries: The direct beneficiaries of USAID assistance will be approximately 10,000 rural households. However, the entire rural population of the central-western zone of approximately 1 million will ultimately benefit from greater food availability.
Principal Contractors, Grantees, or Agencies: U.S. Department of Agriculture, Africare, World Vision, Virginia Polytechnic Institute and Virginia State Universities, Centre for International Cooperation of Israel's Ministry of Foreign Affairs, and Agricultural Cooperative Development International.
Major Results Indicators: As the scope and specification of this Strategic Objective is not yet finalized, indicators and baselines are still under consideration and not yet determined.
Major Results Indicators:
PROGRAM: ERITREA
TITLE AND NUMBER: Increased Capacity for Democratic Governance, 661-S002
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1997: $587,853 DFA
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 1997
Purpose: To build the skills and knowledge necessary to establish and administer the institutions of democratic government.
Background: As a newly independent nation, Eritrea is now building the institutions and processes of democratic governance. This effort is well informed by the organizational experience of the long struggle for independence; by the sizeable, professional Eritreans in Europe and the United States; and the lessons of other nation building experiences. The success in building democratic institutions and processes of governance will determine the future of the Eritrean state. After considerable dialogue with the government at several levels, the U.S. Embassy, and the United States Information Service, USAID assistance was sought, both to support the constitution-writing process and capacity-building through several institutions. Currently, this assistance is being provided through the Technical Assistance Project, as amended. The difficulties that have arisen are due to the sensitivity and concerns over sovereignty of the new nation and the weakness of its new institutions.
USAID Role and Achievements to Date: USAID's involvement in Eritrean democracy-building is less than a year old; however, USAID's role -- as part of the Embassy country team -- will grow as activities are more fully implemented. As USAID's role is primarily that of "capacity building", the influence of this assistance will likely be widespread and long-term. While USAID's activities are new, two achievements are noteworthy: the establishment of a an influential, U.S.-Eritrea university partnership in the critical areas of law, journalism, and public administration; and a country-wide civic education and outreach effort by the Constitutional Commission, which has now submitted a draft Constitution for public debate.
Description: USAID is supporting multiple "capacity-building" activities: (1) a $1.3 million partnership between the University of North Carolina and the University of Asmara featuring the exchange of faculty and graduate students in law, journalism, and public administration, and a fund to improve University facilities and equipment in these areas; (2) a $1 million fund for governance capacity-building that supports in-country training programs for judges, officials and village leaders and the new Eritrean Institute of Management; (3) a broad $2 million participant training fund to send selected officials and leaders to the United States and third countries for specialized training; (4) $1 million in grant support through the United Nations Development Program (UNDP) to support the Constitutional Commission's educational and outreach activities; and (5) a $1.35 million grant to train and advise Eritrea's new Central Bank. Over the next few years, as the structure of the democratic government develops, additional activities may include assistance for the national legislature, strengthening indigenous non-governmental organizations (NGOs), and the development of other institutions of democracy. Training activities supported by the government and other donors, complementary to USAID's activities and Objective 2, also enhance the existing capacity within government institutions.
Host Country and Other Donors: The United States, although often providing assistance through intermediaries such as the UNDP and U.S universities, is now the leading donor in this broad sector of building democratic governance. Other bilateral donors such as Germany, Norway and Italy provide training and equipment in selected governance areas. The World Bank has piloted a Community Development Fund which involves aspects of democratic governance.
Beneficiaries: The direct beneficiaries are the 3,000 officials who are expected to receive training and other assistance. However, the entire nation should benefit from more competent, democratic governance, with the establishment of the rule of law.
Principal Contractors, Grantees, or Agencies: University of North Carolina, EnCorps, and World Learning.
Major Results Indicators: