Academic journal article International Advances in Economic Research

Keynote Address: U.S. Government's Efforts for Growth in Southern Africa

Academic journal article International Advances in Economic Research

Keynote Address: U.S. Government's Efforts for Growth in Southern Africa

Article excerpt

Good morning. It's a pleasure to be here today. I've been asked to speak to you about the U.S. Government's work on economic growth, particularly within Southern Africa, which is what I know best. I believe that it's important for you to know what USAID does, how the Agency goes about implementing development assistance programs, and why USAID works the way that it does.

Currently, I am the head of USAID's Southern Africa regional economic growth office. This portfolio includes South Africa's economic development bilateral program, SADC (Southern Africa Development Community), wide trade and investment activities, regional agriculture and a stand alone program in Swaziland, where USAID does not have an office presence.

My talk will focus on three areas: USAID as an Agency, USAID programs in the region, and the issues and constraints to effective economic growth assistance that development partners keep seeing over and over again. Please take my remarks as just that, my remarks. I do not speak on behalf of the U.S. Government, but as a development professional with 20 some years of experience in the field.

First, USAID is the U.S. Government's foremost international development agency. The Agency maintains technical expertise in all sectors and works through contractors and grantees, both local and international, who implement USAID programs on the ground. Like all U.S. agencies and as part of the government, the Agency's work is funded by the U.S. taxpayer. While most Americans believe that more than 10% of the federal government's budget is spent on foreign aid, it is in fact less than one-half of 1% of budget outlays. In 2001, federal budget outlays stood at $1,863.2 billion of which $11.42 billion went to aid overseas. During the tenure of President Bush, federal outlays grew by an annual growth rate of 6.6% from $1,863.2 billion in 2001 to $2,931.2 billion in 2008. Notwithstanding this fact, official development assistance to Africa (ODA) went from $1.3 billion in 2001 to $5 billion in 2008 under Bush or an annual growth rate of 21.2%. It is scheduled to reach $8.7 billion in 2010.

Aside from government development assistance, the private sector does play a significant role in channeling resources for development. Total private resource flow from the United States to developing countries worldwide reached $709 billion or 5.3% of US GDP in 2006, with private sector investment and remittances accounting for more than 85% of total all resource flows. More recently, other U.S. Government agencies have begun providing development assistance. These include, Departments of Agriculture, Commerce, Treasury, and Energy to name a few. USAID always tries to coordinate efforts between agencies, but as more and more agencies enter the field of international development, this becomes more difficult.

In almost all cases, USAID begins its program design process by consultations with host government bodies and/or the private sector, with the vast majority of USAID programs being implemented under bilateral agreements or agreements with regional governing bodies. In the case of Southern Africa, USAID has agreements with SADC (1) and several bilateral governments and organizations. With a recent change in the U.S. Foreign Assistance Framework, funding levels and programming sectors are somewhat predetermined by where a country falls on the development continuum: from failed states to sustainable partners.

With respect to the economic growth objective of USAID, its activities fall within five areas: trade and investment, infrastructure, private sector competitiveness, agriculture and environment. As you can imagine, activity designs often overlap these areas to form an integrated program. The Paris Declaration on Aid Effectiveness drives the process whereby donors, host governments, and regional bodies agree on areas of assistance as the host government and all stakeholders take ownership of the programs. …

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