Friday, March 9, 2012

USAID Prioritizes Innovation, Direct Investments

By Kathryn McConnell - Staff Writer - Washington 

The U.S. Agency for International Development has shifted its approach to aid, prioritizing innovation and entrepreneurship, investing directly in partner governments and local organizations, and focusing on countries with the most need and best chances of success, said Rajiv Shah, the agency's administrator.

"With this new approach, we are better positioned to address the challenges of our time and move past the false choices that have held us back," Shah told the Council on Foreign Relations in New York March 7. By 2015, USAID will channel 30 percent of its aid funds to local governments - a higher percentage than any other development agency, he said.

USAID has established global competitions to encourage new solutions to development challenges and created partnerships with U.S. universities and research institutes, Shah said. For instance, USAID helped researchers in South Africa prove that a gel microbicide could be effective in fighting HIV and identified 17 antibodies that may hold the key to fighting the pandemic. The agency's support of new seed varieties is allowing farmers in Haiti and Bangladesh to produce much larger rice crops.

The new approach includes shifting USAID personnel to work in priority areas. For example, the approach allowed USAID to work with Tunisia's citizens to help the country establish an independent elections commission and draft election procedures in January 2011. It allowed USAID to move quickly to support civil society groups In Egypt in February 2011. And in Libya, USAID has focused on supporting the Transitional National Council, independent media and civil society groups to help the country transition toward democracy.

"We and the development community broadly must embrace a role that supports those who struggle for dignity and self-determination," Shah said.

USAID also worked with Ethiopia's government to build a social safety net program that gives regular payments and food to communities vulnerable to severe drought in exchange for work building community projects like roads, wells and schools.

Through the Feed the Future initiative, USAID is investing in specific crops in 20 countries it identified as most able to rapidly spur economic growth and fight malnutrition, Shah said.

He said USAID has increased its work force in Afghanistan. That has helped it triple residents' access to electricity, enroll 7 million children in school, increase wheat yields as much as 70 percent and build or improve more than 1,800 kilometers of roads.

Shah said the new approach involves the private sector to a greater degree. "Today, the best corporations have a much more enlightened understanding of the interests they share with the development community. They see the fortune at the bottom of the pyramid," he said, adding that foreign investment in developing countries outpaces aid by nearly 10-to-1.

In addition, in recent years more faith-based groups, entrepreneurs, students and scientists have shown interest in being directly involved in development work. Large countries like India and Brazil that had been major aid recipients are increasingly investing in the developing world, he noted. Shah said that earlier in the week the World Bank reported that by 2010, global poverty was half its level in 1990, meaning the world had reached its first Millennium Development Goal.

(by the Bureau of International Information Programs, U.S. Department of State)