PROGRAM PERFORMANCE OVERVIEW

U.S. foreign policy and the national interest continue to be well served by sensible investments promoting economic growth and political stability abroad. From the visionary Marshall Plan 50 years ago that helped to rebuild Europe in the wake of the Second World War to creating a new generation of export markets across Asia, Latin America and Africa, foreign assistance remains a vital instrument of America's international leadership.

The end of the Cold War brought profound shifts in the world's economic, technological, ethnic, and political fault lines. With the dissipation of the need to contain the Soviet threat, the United States faces major new international challenges: failing nation states, protracted civil wars, bitter ethnic disputes, humanitarian crises and sweeping global problems such as rapid

population growth, widespread environmental degradation, emerging diseases, international terrorism, and narcotics trafficking.

As the indispensable state, America is uniquely positioned to advance its national agenda and promote democratic values internationally. Transitions to democratic governance and open markets have become commonplace even among the most autocratic governments and centrally planned economies. Growing economies and improvements in public health have greatly enhanced the quality of life in many corners of the world. Support for human rights, prevention of genocide, and rebuilding judiciaries and other civil society institutions are increasingly important. The United States, as the lone remaining superpower, is positioned to use its foreign assistance programs to consolidate and further the dramatic gains in all these areas.

The U.S. Agency for International Development (USAID) administers America's foreign assistance programs, which account for less than one-half of 1% of the federal budget. The USAID strategic framework established goals in five areas.

These strategic objectives reflect the following U.S. foreign policy interests:

USAID is making tangible progress in achieving measurable results by concentrating its resources on a few pivotal and mutually reinforcing performance objectives within each strategic goal. Much of the progress in recent years is credited to the agency's focus on performance results. These efforts are centered on the implementation of country strategic plans that consider the agency's comparative advantage and the specific developmental needs of the recipient country. The indicators and targets together with actual performance data permit measurements of program impact that inform budget allocations, providing important incentives to the operating unit to produce results.

This overview of agency performance highlights the effectiveness of USAID's programs in 1995-1996 to support the advancement of the foreign policy agenda of the United States.

BROAD-BASED ECONOMIC GROWTH ACHIEVED

The growth in the importance of exports to the American economy is clear. The 1996 Economic Report of the President projects that this sector will grow faster than any other part of the U.S. economy over the coming decade. The growth of U.S. exports to countries receiving U.S. foreign assistance increased by 76% between 1990-1995. It is anticipated that four out of five consumers in the year 2000 will live in developing countries. The 64 of the 87 countries USAID works with have active socioeconomic growth strategies that are beginning to achieve positive growth rates. Tangible manifestations of the reduction in poverty that USAID has helped promote in the developing world include: increased incomes and expanded access to economic opportunities, improvements in life expectancy, increased literacy rates.

Despite tremendous advances in feeding a growing population, some 800 million people are still hungry, with concentrations in Africa and South Asia. And global food requirements are expected to double in the next 25 years. USAID is taking steps to meet this challenge through food security activities ranging from relief to long-term development.

A major new initiative in FY 1998 will focus directly on enhancing Africa regional food security by addressing: (1) major bottlenecks in agricultural policy, technology and rural infrastructure in several key African countries to support rural growth; (2) the need for tighter linkage between food aid and development assistance resources, better sectoral coordination of activities, and African "ownership" of programs; and (3) the linkages between better nutrition and agricultural growth. USAID will provide key research and policy support to the Africa initiative through its central program partnerships with centers of excellence, for example, U.S. universities and International Agricultural Research Centers.

To achieve broad-based economic growth, USAID has three primary objectives:

Strengthened Markets

USAID's economic growth programs are designed to enhance the productive capacity, both physical and human, of the developing world including those countries in transition. USAID programs spur income growth by helping government institutions become more efficient; by helping unleash vibrant, competitive, private markets to produce and distribute most goods and services; and by increasing worker productivity through basic education and technology transfer.

The gains from market liberalization are widespread in sub-Saharan Africa where 19 out of 26 countries registered economic growth in excess of 2% per annum last year. The continuation of these gains will lead to increased food security and the rise from poverty levels of increasing numbers of this continent's inhabitants.

USAID cental programs support sustainable agricultural growth through the efforts of the International Agriculture Research Centers, collaborative research with U.S. universities aimed at expanding income and food purchasing power in rural societies, and reducing the incidence of hunger and poverty. Food security is a key part of USAID's integrated sustainable development program, and agriculture research is one of the most effective and sustainable investments. Through its central programs, USAID will provide key research and policy support to the Africa food security initiative.

USAID's agricultural research and technology development and transfer programs have increased yields, boosting agricultural growth around the world.

By giving the citizens of the developing world the tools to advance their own economic well-being, the United States also helps its citizens. Direct assistance is provided to the private sector in countries around the world to improve entrepreneurial skills, productivity, and competitiveness. USAID efforts focused on helping nations develop the requisite skills to expand private sector economic participation, with an emphasis on activities to increase exports, including the implementation of appropriate macroeconomic policies and infrastructure, as a means for achieving measurable sustainable development results.

Accelerated economic growth in USAID recipient countries results in increased foreign trade and investment, which in turn creates new jobs and higher incomes for U.S. citizens. U.S. exports of goods and services increasingly drive the U.S. economy, and U.S. exports to developing countries now account for 44% of total exports.

Weak infrastructure is a major impediment to the efficient operation of markets and the expansion of trade. In 19 countries, USAID supports the construction and maintenance of road networks, rail links, telecommunications, and power facilities.

Expanded Access and Opportunity for the Poor

USAID programs help to address the credit and savings needs of countries that have liberalized their financial and macroeconomic policies, and to increase their access to new technologies and productive processes. Working with financial institutions throughout the developing world, USAID is recognized as one of the experts in microenterprise development. The agency's experience has shown that, while macroeconomic reforms are essential to the attainment of sustainable development, efficient markets can produce uneven economic benefits because not everyone has the same access to information, technology, credit, and other resources. Programs must also focus on expanding market access for rural dwellers, legal protection for women, financial services for microenterprises, land reform and titling, and housing.

USAID has successfully expanded access to financial services through its programs.

Land titles enable farmers to secure loans and increase production and incomes, which in turn discourages out-migration to the United States.

USAID programs support technology and information dissemination.

Social norms, low status, and political and religious constraints limit women's opportunities, leading to female-headed households being poorer than those headed by males. In 11 countries, USAID targeted credit programs specifically to women, including 14 micro-finance projects. The projects, in all four geographic regions, provide credit to an estimated 282,000 women.

USAID is not neglecting other disadvantaged groups. Agency programs target the urban poor, the majority black population in South Africa, the indigenous populations of Central and South America, and groups disenfranchised by past beliefs.

Expanded and Improved Basic Education

Investments in education, especially basic education, offer high returns across many sectors by increasing national productivity, improving health, slowing population growth, and strengthening democracy and sound environmental management. Improving literacy and access to education is fundamental to all efforts to ensure sustainable development by supporting the critical element for addressing a range of transnational and trans-sectoral issues. USAID programs address the difficulties that many developing countries face, including a lack of budgetary resources, poorly trained teachers, inappropriate curricula, a shortage of supplies, and inadequate building structures.

An important focus of USAID efforts is education policy reform. Encouragement of adequate national budget allocations has taken center stage. Another emphasis is decentralization to ensure greater local participation. A third emphasis is the work in 18 USAID programs to improve teaching, curricula, and educational materials.

USAID programs in 19 countries work to expand access to education for girls and other disadvantaged groups. Education improves women's income-earning potential, in addition to reducing birth rates. This is especially important in Africa, given the key role that women play in providing for the economic welfare of the family unit.

SUSTAINABLE DEMOCRACIES BUILT

The explosive increase in embryonic democracies since the fall of the Berlin Wall marks this era of unparalleled political change. USAID is helping scores of nations make the transition from autocratic regimes to representative democracies. This agency is uniquely positioned to advance the U.S. foreign policy agenda and to promote democratic values internationally because of its long history of support for grass-roots participatory activities across its assistance portfolio. USAID's efforts to promote the transition to democracy is contained in a four-pronged objectives strategy:

Progress has been made. A decade ago, Freedom House characterized 42% of countries as democracies; today that percentage stands at 61%. Over the past year, Freedom House noted progress in Africa, including Eritrea, Ethiopia, Mali, and Tanzania, four countries in which USAID programs contain democracy components.

Strengthened Rule of Law and Respect for Human Rights

A predictable legal environment, including an independent, fair, and effective judicial system, is essential for protecting citizens against arbitrary use of authority and lawlessness. Ensuring legal protection of citizen's rights and interests is the cornerstone of the rule of law. USAID programs work to strengthen the administration of justice.

More Genuine and Competitive Political Processes

USAID supports free and fair elections around the world by helping to create impartial and open electoral procedures, laws, and regulations, and a better informed electorate; to improve local and international monitoring; and to make political parties more responsive to their constituents.

Increased Development of Politically Active Civil Society

Active citizen participation at all levels in the democratic process is key to maintaining stable democratic governments. USAID helps a variety of private voluntary and nongovernmental organizations working to achieve the political reforms needed to extend the democratic practices to overcome the legacies of authoritarian rule.

USAID supports independent media in Ukraine, Cambodia, and throughout Latin America.

More Transparent and Accountable Government Institutions

To build and sustain democracy, governments must perform effectively and efficiently, respect rights, and respond to citizens' interests. The goal of USAID's decentralization program is impartial and informed government decision-making.

Strong legislatures give citizens greater access to the policy process and more control over the executive branch.

WORLD'S POPULATION STABILIZED AND HUMAN HEALTH PROTECTED IN A SUSTAINABLE FASHION

The achievement of stable population growth rates are essential to the success of USAID's attempts to achieve sustainable development. The agency's strategy to stabilize the global population level and protect human health, including child survival, is based on the following four objectives:

Despite impressive improvements in health status in the past ten years, nearly 12 million children in developing countries under age five die each year. Most of these deaths are preventable. USAID approach to improving child survival focuses on effective low-cost interventions that address the principal causes of morbidity and mortality, particularly diarrheal and vaccine preventable diseases, acute respiratory infection, malaria, and malnutrition.

USAID's health, nutrition, and population programs saved lives and provided access to appropriate health care and family planning services to millions. The agency's success in this area is seen in average population growth rates in developing countries of 2.2%, down from 3% thirty years ago, while infant mortality has declined from an average 107 deaths per 1,000 live births in 1980 to 77 in 1995. But, much work remains before sustainable population growth rates will be achieved. World population levels, now at 5.7 billion, will reach 10 billion by the year 2050, or the equivalent of an additional New York City each month. This occurs while more than 12 million children under five and 7 million adults die each year in the developing world of preventable or treatable ailments.

Sustainable Reduction in Child Mortality

USAID's health efforts have led to the prevention of the deaths of an estimated four million infants and children annually. USAID's child survival programs target the principal causes of these deaths, including vaccine preventable disease, diarrhea, malnutrition, acute respiratory infections, and malaria. Success was achieved under the Expanded Program for Immunization (EPI) with global vaccination coverage rates increasing from 44% to 80% between 1984-1990.

Last year, work financed by a USAID grant led 27 African countries to adopt a new malaria control strategy to address one of the major causes of death among children in the region. In 1993, following a malaria policies, plans, and programs assessment, supported by USAID and the Centers for Disease Control and Prevention, Malawi became the first African country to officially change its national drug policy.

Malnutrition is a major contributor to the death of over half the children who die each year from preventable causes. An estimated 200 million children worldwide are malnourished. USAID-funded research has shown that adequate vitamin A intake can reduce morbidity by at least one-fourth.

USAID actively promotes new health treatment protocols and technology. This includes support to the Integrated Management of Child Illness program, which combines interventions in a single package targeting pneumonia, diarrhea, malaria, and measles for a more effective public health intervention.

Sustainable Reduction in Maternal Mortality

Maternal mortality remains high throughout the developing world despite overall improvements in health status in developing countries. Annual maternal deaths during pregnancy and childbirth are estimated at 600,000, roughly 100 times those of developed countries. Major pregnancy and birth complications can be prevented or treated through family planning and appropriate obstetric care for pregnancy and birth complications. Thirty-one USAID programs have maternal health objectives.

USAID initiated programs to address the health and human rights aspects of the traditional practice of female circumcision in Egypt, Eritrea, Guinea, Kenya, and Mali.

Sustainable Reduction in Unintended Pregnancies

High levels of fertility from unintended pregnancies translate into rapid population growth that impedes economic progress, contributes to environmental degradation, and strains fragile political and social institutions. More than one-third of all births in the developing world are the result of unintended pregnancies. USAID efforts target the more than 150 million women who have expressed an unmet need for family planning. The agency has made remarkable progress in expanding service availability and use in a number of countries.

Following approval by the U.S. Food and Drug Administration (USFDA) in 1993, the injectable contraceptive Depro-Provera was added to USAID-supported programs, expanding the choice of methods. Three million doses were provided to 47 countries, an increase from the 835,000 doses in 18 countries in 1994.

USAID is contributing to future progress through supporting operations research in 30 countries. In 1995, the clinical trial of a female barrier method was completed with positive results. USAID-funded research suggests that the lactational amenorrhea method, relying on breast feeding for child-spacing, is 98% effective. USAID also supported development of the Reality female condom, recently approved by the USFDA, increasing options for women.

An important focus of USAID efforts is the sustainability of its programs, for example, through the use of service fees and training.

Sustainable Reduction in STI/HIV Transmission Among Key Populations

Twenty-eight million people were infected with HIV by the mid-1990s, with almost eight million developing AIDS. More than six million people have died from this disease worldwide, and 5,000 new HIV infections occur daily. As a result, hard-won gains in the health field are being eroded, and the mounting demands for increased health care and social support have put pressure on health systems and local and national governments' budgets. The loss of adults in their most productive years places burdens on families, communities, and industries. By the year 2010, individual life expectancy rates will decline by more than 25 years in several African and Asian countries.

Improving control of sexually transmitted infections (STI) is one of the most effective strategies for limiting the spread of HIV/AIDS. Hence, USAID is using family planning and maternal and child health programs for STI/HIV prevention and control. USAID also financed research that led to the development of low-cost, rapid diagnostic tools for STIs appropriate for countries with limited resources. NGOs are helping USAID to control the spread of AIDS and have demonstrated effective community programs to mobilize HIV/AIDS prevention and care.

USAID initiated HIV/AIDS prevention programs in 32 countries that have reached 3.2 million people and trained 58,000 people to implement programs in their own countries. An important program component is encouraging countries to budget more funds to fight the disease.

Increased condom use is a key intervention to prevent the spread of AIDS and other sexually transmitted diseases. In 1995, USAID shipped 520 million condoms to developing countries.

Clear progress is being reported.

ENVIRONMENT MANAGED FOR LONG-TERM SUSTAINABILITY

America's own well-being is directly threatened by worldwide environmental degradation. Environmental degradation respects no national borders and ultimately threatens the economic and national security of the United States. In the long run, the United States cannot escape the effects of global climate change, biodiversity loss, and natural resource depletion. Last year, an estimated 25 million acres of forest, an area the size of Virginia, were felled in Africa, Asia, Latin America, and Russia. Careful management of natural resources is essential if development investments are to yield sustainable benefits. Unpolluted productive lands and water are necessary for long-term economic growth. Clean air and potable water are fundamental to the health of communities.

USAID's environmental strategy addresses global environmental threats and promotes sustainable development through the pursuit of five objectives:

Biological Diversity Conserved

USAID's 29 programs focus on biological diversity, whose disappearance has serious implications worldwide. USAID resources strengthened 100 protected areas, more than 100 million acres worldwide comparable to the size of California. These areas cover a wide range of ecosystems -- deserts, wetlands, savannas, rain forests, and coral reefs -- in countries ranging from Brazil to Uganda, with incentives to the poor to eliminate such destructive practices as "slash-and-burn" cultivation. A million acres were added to Mexico's protected area system alone since 1990, resulting in 45% more forested land under protection.

Global Climate Threat Reduced

There is growing evidence linking human-induced emissions of greenhouse gases to increases in average global surface temperatures. These gases could have profound negative consequences on the quality of life and food production by inducing shifts in agricultural zones, higher sea levels, and more frequent weather-related disasters. The agency's global climate change strategy is reducing greenhouse emissions from energy and land use. The energy sector is the principal source of greenhouse emissions in many of USAID's major climate-change countries.

Sustainable Urbanization Promoted and Pollution Reduced

At current trends, more than 50% of the world's population will live in urban areas within ten years. There are already 22 "megacities," with populations over 8 million where residents lack access to such basic services as clean water and latrines. Women and children are most vulnerable. More than 3 million children, many in urban areas, died in 1995 as a direct result of water-borne diseases stemming from unsanitary drinking and bathing water. In 23 programs, USAID supports efforts to increaseaccess to water and sanitation services, to provide decent and affordable shelter, to improve urban management, and to promote pollution prevention and control.

Increased Provision of Environmentally Sound Energy Services

Energy demand is increasing seven times faster in developing countries than in developed nations, where the developing countries' inefficient energy services contribute to the global greenhouse burden through pollution, and to the depletion of non-renewable fuel resources. In these countries, the introduction of appropriate energy technology could achieve a 20%-30% savings in use by increasing sector efficiencies.

An added benefit to the United State from these activities is business for U.S. companies.

Sustainable Natural Resource Management

To arrest the rapid degradation of renewable resources in Africa, Asia, and Latin America, USAID is focusing on the four resources that provide the greatest benefits to the largest number of people: forests, water, agricultural lands, and coastal zones.

USAID assists 11 countries in addressing their most pressing water management issues. The 200 million people living in countries where water scarcity is a major developmental constraint will increase to one billion by 2050.

To practice agriculture sustainability, the agency focuses on technology transfer, including improved crop and land management and the development of drought-resistant crop varieties through its Collaborative Research Support Program.

The agency supports nine USAID mission-based coastal resource management programs and several of a regional nature. More than half the world's coasts are under moderate or high risk of degradation.

LIVES SAVED, SUFFERING REDUCED, AND DEVELOPMENTAL POTENTIAL REINFORCED

The United States has a long and generous tradition of aiding the victims of man-made and natural disasters, with many instances of USAID assistance making the difference in the survival of victims. The demand for this assistance has increased sharply in recent years with the proliferation of complex emergencies, e.g., Bosnia and Haiti. This unfortunate aftermath of the Cold War is one of the most challenging issues facing the U.S. today. In 1996, USAID allocated almost $760 million to 65 declared emergencies.

The agency continued its response to numerous complex emergencies as well in Rwanda, Sudan, and Bosnia-Hercegovina. The objective of this assistance is to reduce the suffering and the need for future funds. USAID increasingly focuses its humanitarian assistance on prevention and transition out of crises. The agency targets three areas: prevention, relief, and transition. An additional component is reinforcement of development potential.

Potential Impact of Humanitarian Crises Reduced (Prevention)

While it is not always possible to prevent emergencies, their potential adverse impact can be reduced. Droughts may be unavoidable, but famine is not; internal tensions are inevitable, but social collapseis not. USAID seeks to prevent transient difficulties from becoming complex crises. This requires a strategic approach involving planning, prevention, and regional initiatives.

Urgent Needs Met in Crisis Situations (Relief)

Timely and effective emergency relief activities consist of meeting critical human needs, providing for near-term food needs, and coordinating emergency responses with other countries and relief organizations. USAID assistance helps meet victims' needs, the majority of whom are women and children, and aids their resumption of productive lives.

Over the past year, USAID responded to 48 natural disasters, including 22 floods, 2 droughts, 3 epidemics, 2 tornados, 3 cyclones, 6 earthquakes, 2 winter emergencies, 1 fire, 1 volcanic eruption, and 1 mud slide. The agency implemented continuing complex emergency relief efforts in such countries as Angola, Bosnia-Herzegovina, Burundi, the Caucasus, Liberia, and Rwanda.

Security Established and Basic Institutions Functioning to Meet Critical Needs and Basic Rights (Transition)

USAID assistance targets the unique needs of nations emerging from crisis to enable them to return to normalcy and resume their sustainable development efforts. Since these crises frequently occur in the poorest, most unstable countries, a primary goal is to provide "transition" assistance to return them to sustainable development schedules. This assistance includes programs to reinforce local security through demobilization and de-mining, to strengthen the local governance and institutions that promote peaceful conflict resolution and reconciliation, and to restore social and physical infrastructure.

Over the past decade, more than a million children have lost one or both parents as a result of war. In response, USAID launched the Fund for Displaced Children and Orphans and collaborated with the Red Cross, United Nations Children's Fund (UNICEF), and NGOs to reunite orphaned, lost, or abandoned children with family members. The programs focus on reuniting unaccompanied children affected by war, street children, and orphans of the HIV/AIDS pandemic with their remaining relatives.

Emergency and development assistance were combined innovatively to produce encouraging results in Haiti in terms of malnutrition and micro-infrastructure activities.

Development Potential Reinforced

Improving agricultural infrastructure to bring about sustainable improvements in agricultural productivity is a major focus of the non-emergency Public Law Title II and Title III food programs. The Title II programs support labor-intensive, food-for-work activities aimed at building rural roads, small-scale irrigation works, and other infrastructure, promoting reforestation, preventing floods, and establishing village-level grain and seed storage facilities. Title III programs form essential components of USAID's macroeconomic and sectoral policy reforms and food security activities and complement USAID field mission programs.

Other Title II activities include feeding programs at health centers to encourage mothers to bring their children for immunizations and for the mothers to receive training in nutrition, health, family planning, and increasingly community leadership and literacy.

Title III accomplishments in FY 1996 include:

RELEVANCE OF USAID EXPERIENCE TO U.S. PROBLEMS

Since its inception two years ago, USAID's Lessons Without Borders program has brought together hundreds of development practitioners from the United States and abroad to discuss such issues as childhood immunizations, economic empowerment, family planning, and the environment. These discussions and information exchanges have led to local groups in the four cities participating in theprogram -- Baltimore, Maryland; Boston, Massachusetts; Seattle, Washington; and Washington, D.C. -- to engage in several follow-up exchanges between local development practitioners and international development experts. As a result, local groups have leveraged private donations to pursue several activities based on the lessons learned from USAID programs overseas.

USAID employees are exceptionally experienced in many of the problems facing the poorest neighborhoods in U.S. cities, and the agency is well situated to help address these issues. Of special note is USAID's assistance to the nation's capital through a targeted program with a D.C. public housing community. Through this program, the community has leveraged private funds and pro bono support from a number of non-profit organizations to expand access to public health services, thereby improving the general level of health standards for its residents.

DEVELOPMENT ASSISTANCE ALLIANCES

The United States provides less than 20% of the official development assistance going to developing countries. If U.S. bilateral assistance resources are to have the desired impact, then it is crucial to leverage the remaining 80% of official assistance resources to support as far as possible U.S. assistance and foreign policy priorities. Consequently, USAID places a high priority on donor coordination, both in the field and at the policy level with other donors' decision-makers.

The only regular forum for policy-makers of donor countries is the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD). Almost all major industrialized donors face constrained budgets for development assistance, and as a result, the commitment to improving the quality and impact of development assistance through the DAC is stronger than ever.

At the May 1996 DAC High Level Meeting, 21 donor countries approved a forward-looking rationale and strategy for development cooperation, Shaping the 21st Century: The Contribution of Development Cooperation. This consensus vision provides an overarching policy framework for partnerships for development and endorses many of the ideas pioneered by USAID.

This is the first time that donors have collectively endorsed a set of key results-oriented goals. The ambitious but achievable targets agreed upon include goals in the following areas: poverty reduction, primary education and gender equality, reduced mortality for infants, children, and mothers, access to reproductive health services, and national strategies for environmentally sustainable development. The goals are important as representing a vision. But the vision must be pursued country by country, based on locally owned national goals.

The ideas in Shaping the 21st Century draw upon a broad experience of donors, multilateral institutions, global conferences and the aspirations of developing countries. There is room in this framework for many initiatives. There should also be room for increased harmonization and more effective coordination. It is the partnership concept and the opportunity for concerted action to advance a broadly shared concept that are key to implementation of the DAC strategy.

Japan, the world's largest donor country since 1993, was a major force behind the DAC's adoption of Shaping the 21st Century. Japan continues to work closely with the United States and other countries to implement the strategy. The commitment of the government and people of Japan to development assistance remains strong. Japan is one of the few major industrialized countries which continues to increase development assistance funding. (A 2.1% increase is expected in 1997.)

As a world leader in development assistance, Japan is becoming increasingly active in areas outside Asia, including Africa and Latin America. Japan has moved substantially away from its prior mode of almost exclusive focus on infrastructure and equipment assistance to join the United States in such major areas as HIV/AIDS, polio eradication, child survival and health, environment, and civil society and democracy. We now have a substantial portfolio of cooperative projects with Japan in these areas around the world.

Many of USAID's more recent project cooperation efforts with Japan are associated with the U.S.-Japan Common Agenda. Although the Common Agenda covers U.S. and Japanese cooperation in areas of global importance beyond development assistance, its development assistance components have been particularly successful.

The U.S.-Japan development partnership also has contributed to strengthened U.S.-Japan relations in areas of particular foreign policy interest. Japan has become a solid and dependable partner in areas such as Bosnia, South Africa, the West Bank and Gaza, and Haiti.

In large part, the success of the USAID-Japan relationship is attributable to the annual high-level coordination meetings which have taken place between the United States and Japan on development assistance since the late 1980s. Staff exchanges and joint programming and evaluations have become a regular part of U.S.-Japanese cooperation and contribute to closer and more effective coordination. USAID and Japan are just beginning an assessment of their cooperation, drawing from the more than 200 ongoing cooperative activities worldwide.

The European Commission (EC), with an annual development budget of about $7.5 billion, is another major donor with which USAID maintains an increasingly close and mutually beneficial relationship. U.S.-EC cooperation took a higher level of importance following the 1995 launching of the New Transatlantic Agenda (NTA) by Presidents Clinton and Santer of the European Commission. Under the umbrella of the NTA, USAID and the EC now hold annual high-level U.S.-EC Assistance Consultations. USAID and the EC jointly support programs in democracy and governance, civil society, health and population, environment, and humanitarian assistance.

There are numerous examples of successful project cooperation between USAID and the EC. We jointly supported the successful elections in Nicaragua. Collaborative programs on civil society have been launched in Bangladesh, and in Benin, a joint assessment of the transition to a democratic government has just been completed. Programs in the environment are moving forward in the Congo Basin, and in Bulgaria, USAID and the EC are working together to strengthen the forestry and national parks services. In the NIS we have continued to build the program to develop regional environmental centers. We have worked very closely on humanitarian assistance for the Great Lakes region and in the recent crisis in Zaire. We have supported the new democratic government in Haiti throughcomplementary programs, such as the EC-funded program to establish a Public Defenders Office in Cap Haitien, and the U.S. support for legal assistance for prisoners.

The October 1996 High-Level U.S.-EC assistance consultations concluded with agreements on major democracy and governance programs in Central and South America and will move forward on specific activities in Nicaragua, El Salvador, and Mexico. We will also move forward on specific programs in civil society in the Andean region, Guatemala, Nicaragua and Mexico. In Asia and the Near East, we will cooperate on environment and clean energy technologies, as well as specific programs for health and population and macroeconomic policy reform for Egypt and Morocco. We will exchange staff to learn from each other's modes of operation in the area of humanitarian assistance. In Haiti, we will continue to complement our programs by supporting the Judicial Training School, decentralization, and local governance.

A major objective of USAID's donor coordination efforts is to engage the entire donor community in support of an approach which recognizes the significance of strengthening civil society and promoting strategic partnerships as vehicles for sustainable development and community problem solving. The New Partnerships Initiative (NPI) is a critical tool in this donor dialogue. Announced by Vice President Gore at the United Nations World Summit for Social Development in March 1995, NPI emphasizes the strategic value of a strong and vibrant civil society and looks to strategic partnering among nongovernmental organizations, the business community, and institutions of local democratic governance to help break the dependence of developing countries on external support.

After publication of the Core Report of the New Partnerships Initiative in July 1995, the USAID Administrator authorized agency-wide implementation of the initiative by FY 1998, preceded by an eight-month learning phase. Pilot activities were subsequently concentrated in eight USAID "leading edge missions" (Bangladesh, Bulgaria, Guinea, Haiti, Kenya, Philippines, Sri Lanka and Zambia) and seven "partner missions" (Ecuador, Indonesia, Madagascar, Panama, Romania, Russia and South Africa) from March through October 1996.

The experiences and lessons learned from the pilot USAID missions were distilled in the NPI Resource Guide and published as a report of the NPI learning team in January 1997. The Resource Guide -- which brings together the work of the learning team in Washington and working groups in the areas of local capacity building and partnerships, the enabling environment and performance measurement -- provides a practical "tool kit" for USAID missions interested in implementing an NPI approach.

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