This page introduces the concept of assistance instruments, briefly describes its two categories (grants and cooperative agreements), and contrasts it, in broad-brush, with procurement contracts. USAID commonly uses two main types of instruments to implement foreign assistance activities.

These types are:

Assistance instruments are characterized by the creation of assistance relationships between USAID and organizations or individuals (Recipients), pursuant to which USAID transfers funds or other items of value to accomplish a public purpose of support or stimulation authorized by federal statute.

Both grants and cooperative agreements reflect assistance relationships. The difference between the two relates to the degree of involvement that USAID wishes to have in the performance of the Recipient's program.

Procurement contracts, as opposed to assistance instruments, establish a procurement relationship in which USAID buys something for the direct benefit or use of the federal government.