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Fact Sheet
Office of the Spokesman
Washington, DC
December 31, 2007


The United States and International Development: Partnering for Growth

See updated fact sheet released by the Bureau of Economic, Energy and Business Affairs.

“America is pursuing a clear strategy to bring progress and prosperity to struggling nations all across the world. We're working to increase access to trade and relieve the burden of debt. We're increasing our assistance to the world's poorest countries and using this aid to encourage reform, and strengthen education, and fight the scourge of disease.” – President George W. Bush, May 31, 2007

The United States is committed to helping the world's poor. Development depends on strong, accountable governance, and economic policies unleashing private sector growth. At the International Conference on Financing for Development at Monterrey in 2002, the world articulated a new model for development calling on developing countries to establish sound economic and social policies, and for developed countries to support these efforts through an open trading system, private capital flows, and additional development assistance. We believe that foreign assistance best supports those nations making necessary political and economic reforms.

The U.S. Record

  • Top net goods importer from developing countries at $557 billion in 2006 ($916 billion in imports minus $359 billion in exports).
  • World’s largest donor of bilateral and multilateral foreign aid. U.S. official development assistance (ODA) of $23.5 billion (net disbursed) in 2006 is the second highest annual level ever provided by any donor country. (The U.S. provided $27.9 billion in 2005.)
  • Over $5.5 billion in Compact funding approved for 16 top performing countries in the last three years by the Millennium Challenge Corporation, which expects to complete additional Compacts in 2008.
  • $6 billion in HIV/AIDS funding through the President’s Emergency Plan for AIDS Relief in 2008, with a Presidential proposal to add $30 billion over the next 5 years (2009-2013) to the initial 5 year, $15 billion commitment.
  • A record $5.6 billion in U.S. bilateral aid to Sub-Saharan Africa in 2006, a $1.5 billion (38%) increase from 2005.
  • $3.0 billion in U.S. humanitarian assistance granted in 2006.
  • $30 billion in private U.S. charitable contributions (not included in ODA) to developing countries in 2006.
  • Top contributor to humanitarian clearance of landmines.

Elements of the U.S. Contribution to Development [1]

Official Development Assistance

The Bush Administration has dramatically increased U.S. Official Development Assistance (ODA), at a faster rate than at any time since the Truman Administration. The 2006 U.S. ODA amount of $23.5 billion is the second highest annual expenditure ever by any donor country; the highest was $27.9 billion provided by the U.S. in 2005. The drop in U.S. foreign assistance outlays in 2006 relative to 2005 was due to a decline in amounts spent in Iraq and a large one-time forgiveness of Iraqi debt that was counted in the 2005 total. Excluding Iraq, U.S. ODA increased by $2 billion in 2006 compared to 2005. Iraq and Afghanistan were the largest recipients of bilateral aid in 2006 with $4.8 billion and $1.4 billion respectively; this assistance provided for humanitarian relief, economic development, reconstruction, and security assistance. In addition, $3.9 billion went to the world’s other least developed countries, and a further $2.1 billion to other low-income countries, not counting U.S. regional and global programs. At the Gleneagles G8 Summit in 2005, President Bush announced that the United States would double assistance to Sub-Saharan Africa from a base of $4.4 billion in 2004 to $8.7 billion by 2010. The United States is on track to meet that goal and, in 2006, U.S. bilateral ODA to Sub-Saharan Africa reached a record high at $5.6 billion, an increase of more than 38% from 2005.

In March 2005, the U.S. endorsed the Paris Declaration on Aid Effectiveness, continuing to emphasize that existing aid levels should be used more effectively. The USG continues to pursue a “whole of government” approach to improve coherence and has reached an agreement in October 2007 with the “Nordic +” group of leading donor countries to work jointly to improve aid effectiveness in selected countries.

Millennium Challenge Account

The Millennium Challenge Account (MCA) is an innovative model in development assistance. It is built on the principle that foreign aid yields better results where sound economic policies and good governance provide an enabling environment for economic growth. The total MCA appropriated funding from Fiscal Year 2004 through Fiscal Year 2008 was over $7.5 billion. Since its inception in 2004, the Millennium Challenge Corporation (MCC), which implements the MCA, has approved agreements, called Compacts, with 16 countries— Armenia, Benin, Cape Verde, El Salvador, Georgia, Ghana, Honduras, Lesotho, Madagascar, Mali, Mongolia, Morocco, Mozambique, Nicaragua, Tanzania, and Vanuatu — worth over $5.5 billion dollars, and expects to complete additional Compacts in 2008.

To provide further incentive for reform and help additional countries qualify for Compacts, MCC provides “threshold” assistance to countries that fall just short of Compact eligibility to help them address specific areas of policy weakness identified in the MCA selection indicators. To date, MCC has approved threshold programs with 18 countries totaling nearly $400 million. MCC also created a private sector initiatives office in November 2007 to enhance private sector engagement.

President’s Emergency Plan for Aids Relief

President Bush’s Emergency Plan for AIDS Relief (PEPFAR) continues to partner with developing nations to fight the pandemic around the world. Before the G8 Summit in June 2007, President Bush announced his intention to work with Congress to reauthorize PEPFAR. The five-year, $30 billion proposal would add to the initial $15 billion commitment made in 2003, which is already the largest international health initiative dedicated to a specific disease. Building on prior success and in partnership with the host nations, PEPFAR has supported antiretroviral treatment for approximately 1.45 million people globally through September 2007, including approximately 1.36 million in PEPFAR’s 15 focus countries in sub-Saharan Africa, Asia and the Caribbean.

Additionally, as of September 2007, PEPFAR supported over 30 million HIV/AIDS counseling and testing sessions for men, women and children, and cared for more than 6.6 million people living with HIV/AIDS worldwide, including care for more than 2.7 million orphans and vulnerable children. These results demonstrate important progress towards the 5-year goals of supporting antiretroviral treatment for at least two million people, prevention of seven million new infections, and care for 10 million people infected with or affected by HIV. In Fiscal Year 2008, the Emergency Plan is committing an additional $6 billion to the global fight against AIDS.

Through PEPFAR, the U.S. Government is also a major contributor to the Global Fund to Fight AIDS, Tuberculosis, and Malaria, having provided over $2.5 billion since the launch of the Fund in 2002, or nearly one-third of the Global Fund’s total resources.

Other Health Initiatives

President Bush announced the President's Malaria Initiative (PMI) in June 2005. A five-year, $1.2 billion program, PMI challenges other governments and the private sector to join the U.S. government in combating malaria, with the goal of cutting the malaria mortality rate by 50 percent in 15 countries in Africa. Through partnerships working in the first three target countries–Angola, Tanzania, and Uganda – PMI reached about six million people in its initial year. In 2007, with an expanded program, an estimated 30 million persons will benefit from life-saving prevention or treatment interventions such as insecticide-treated bednets, indoor residual spraying, artemisinin-based combination therapies, and preventive treatment of pregnant women. Other target countries will be added in FY08 including: Benin, Ethiopia, Ghana, Kenya, Liberia, Madagascar, Malawi, Mali, Mozambique, Rwanda, Senegal, and Zambia. The U.S. has also been a strong supporter of tuberculosis (TB) control efforts globally. Between 2000 and 2006, the U.S. committed approximately $500 million to building strong TB programs in countries with a high burden. In addition to the USG investments in TB through the U.S. Agency for International Development (USAID), which total about $90 million in Fiscal Year 2007 and $162 million in Fiscal Year 2008, through PEPFAR the U.S. will allocate an additional $150 million to address TB/HIV co-infections.

Relief and Humanitarian Assistance

The U.S. is the largest donor country of official humanitarian aid for victims of famine, war and natural disasters. U.S. humanitarian assistance totaled more than $3 billion for 2006, aimed at helping those affected by disaster through the rapid delivery of food, water, shelter, and medicines. The U.S. is the largest food aid provider, giving $2 billion, or 49% of total food aid worldwide in 2007. The U.S. also provides major resources for ongoing reconstruction efforts to help nations recovering from conflict and natural disasters. Often, the U.S. military in cooperation with USAID is mobilized to deliver life-saving aid to victims as quickly as possible, such as after 2004 Indian Ocean tsunami and the South Asian earthquake of 2005. U.S. contributions to humanitarian mine action of well over $1 billion have contributed to the steep decline in casualties from persistent landmines and explosive remnants of war, from about 26,000 annually four years ago to approximately 3,000 worldwide in 2006.

Debt Forgiveness

At the G8 summit in 2005, the U.S. led efforts to obtain G8 approval of what is now the Multilateral Debt Relief Initiative (MDRI). The agreement called for 100 percent cancellation of heavily indebted poor countries’ (HIPCs) debt obligations to the World Bank, African Development Bank, and the International Monetary Fund.

Nineteen African countries have already benefited from MDRI debt relief and another 14 African countries are eligible to receive similar debt cancellation once they achieve the required standards. After almost two years of implementation, this initiative has eliminated over $38 billion in current and future debt service for 25 countries in Africa and elsewhere.

Moreover, the enhanced HIPC initiative and additional debt relief provided by the Inter-American Development Bank have cancelled an additional $49 billion. Taken together, these international efforts have removed a debt burden of approximately $87 billion in current and future debt service for these 25 countries.

Multilateral Contributions

The U.S. is the world’s single largest contributor to the United Nations and to the multilateral development banks (MDBs). In 2006, U.S. donations to multilateral organizations including the UN, World Bank, and other MDBs totaled $2.4 billion. Of this total, $827 million was provided to the World Bank Group and $637 million to the United Nations. These contributions are to organizations promoting economic growth, poverty reduction, and increased living standards through development and humanitarian assistance. Our assistance leverages tens of billions of dollars from other donors.

Trade

Trade is a powerful anti-poverty tool, spurring economic growth, increasing opportunity, and creating new and better paying jobs. In recognition of this fact, the U.S. has led by example in promoting trade with developing countries. The United States is the largest net importer from developing countries at $557 billion in 2006 ($916 billion in imports minus $359 billion in exports). This amount dwarfs the size of other financial flows to these countries. Through preference programs including the African Growth and Opportunity Act (www.agoa.gov), the Caribbean Basin Initiative, the Andean Trade Preference Act, and the Generalized System of Preferences, many developing country goods receive zero-tariff access to the U.S. market. The U.S. has taken a bold position in World Trade Organization negotiations, with ambitious proposals that aim to ensure the realization of the development potential of the Doha Round. The U.S. is also a leader in “trade capacity building” programs aimed at allowing developing nations to better integrate into and benefit from the global trading system, contributing $1.4 billion in 2006 and more than $6.2 billion in total since 2000.

Other Private Financial Flows

The U.S. is the leading country in private financial flows to the developing world, with net capital flows exceeding $62 billion in 2006. In addition, residents of the United States are the most generous people in the world with personal remittances exceeding $41 billion and private grants estimated at $30 billion in 2006.

Public-Private Partnerships (PPPs)


USAID’s Global Development Alliance (GDA) was created in 2001 to forge public-private alliances that leverage the skills and resources of non-traditional partners in development efforts. GDA has over 600 public-private alliances, with over $2.1 billion in government funding leveraging more than $5.8 billion in private resources. More than 1,700 organizations, including international and local businesses, private foundations, non-governmental organizations, and governments, are alliance partners in every country where USAID works. One such partnership was the South Asia Earthquake Relief Fund which raised more than $100 million in cash and in-kind contributions for earthquake relief and reconstruction in the affected region of Pakistan. The Overseas Private Investment Corporation, the U.S. Export-Import Bank, and the United States Trade and Development Agency also engage in public-private alliances, implementing programs ranging from increasing access to potable water to providing technology for sustainable environmental protection among the world’s poor.

The U.S. State Department’s Global Partnership Center, launched in December 2007, supports State’s existing partnership activity, by building partnerships through a replicable process, providing needed guidance and practical tools, and serving as a point of contact for outside partners' inquiries. State’s broad-ranging public-private partnership program supports efforts to combat AIDS, to reinforce official humanitarian mine action, and others that support development.

Peace and Security Cooperation

Peace and stability are important preconditions for development. U.S. spending on overseas security programs increases stability and contributes to the environment needed for sustainable economic growth and poverty reduction. U.S. security assistance to improve performance of police forces and build partner capacity to contribute to international peace operations was an estimated $4.9 billion in 2006, with another $1.15 billion spent for UN peacekeeping activities from the Contributions for International Peacekeeping Activities account. All but $75 million of these amounts are in addition to the $23.5 billion reported as Official Development Assistance disbursed in 2006. The U.S. is also working to integrate considerations of conflict, instability, and state fragility in the new foreign assistance framework and to implement reforms for better collaboration among development, diplomatic, and military partners in complex humanitarian environments.


[1] Some forms of government expenditures promote development, but are not counted under the OECD DAC definition as part of Official Development Assistance (e.g., some forms of military assistance). All private sector programs and international trade are not considered part of ODA.

2008/1172


Released on December 31, 2007

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