United States Agency for International Development (USAID)

The United States Agency for International Development (USAID) is an independent agency of the U.S. federal government that is primarily responsible for administering civilian foreign aid and development assistance. USAID is one of the largest official aid agencies in the world with a budget of over $27 billion. It accounts for more than half of all U.S. foreign assistance, which is the highest in the world in absolute dollar terms.

On September 04, 1961, Congress passed the Foreign Assistance Act that reorganised the U.S. foreign assistance programs and mandated the creation of an agency to administer economic aid. USAID was subsequently established by the executive order of President John F. Kennedy, who sought to unite several existing foreign assistance organizations and programs under one agency. USAID became the first U.S. foreign assistance organisation whose primary focus was long-term socioeconomic development.

USAID's programs are authorised by Congress in the Foreign Assistance Act, which Congress supplements through directions in annual funding appropriation acts and other legislation. As an official component of U.S. foreign policy, USAID operates subject to the guidance of the President, Secretary of State, and the National Security Council. USAID has missions in over 100 countries, primarily in Africa, Asia, Latin America, the Middle East, and Eastern Europe.

Leading this transformation was President John F. Kennedy. President Kennedy recognized the need to unite development into a single agency responsible for administering aid to foreign countries to promote social and economic development. On November 3, 1961, USAID was born and with it a spirit of progress and innovation. November 3, 2011 marked USAID's 50th Anniversary of providing U.S. foreign development assistance From the American People.

Early international development efforts

The modern-day concept of international development assistance took shape after World War II ended in 1945. George C. Marshall, the Secretary of State from 1947 to 1949 provided significant financial and technical assistance to Europe after the war. Famously known as the Marshall Plan, this was a successful effort that allowed Europe to rebuild its infrastructure, strengthen its economy, and stabilise the region.

The foreign policy of international aid

Building on the success of the Marshall Plan, President Harry S. Truman proposed an international development assistance program in 1949. The 1950 Point Four Program focused on two goals: to create markets for the United States by reducing poverty and increasing production in developing countries, and diminish the threat of communism by helping countries prosper under capitalism.

From 1952 to 1961, programs supporting technical assistance and capital projects continued as the primary form of U.S. aid, and were a key component of U.S. foreign policy.
During this time, government leaders established various precursor organizations to USAID, including the Mutual Security Agency, the Foreign Operations Administration, and the International Cooperation Administration.

1960s: The beginning of USAID

In 1961, President Kennedy signed the Foreign Assistance Act into law and created USAID by executive order. Once USAID got to work, international development assistance opportunities grew tremendously. The time during the Kennedy and Johnson administrations became known as the “decade of development.”

1970s: A Shift to Basic Human Needs

In the 1970s, the USAID began to shift its focus away from technical and capital assistance programs. Instead, U.S. development assistance stressed a “basic human needs” approach, which focused on food and nutrition, population planning, health, education, and human resources development.

1980s: A Turn to Free Markets

In the 1980s, foreign assistance sought to stabilise currencies and financial systems. It also promoted market-based principles to restructure developing countries' policies and institutions. During this decade, USAID reaffirmed its commitment to broad-based economic growth, emphasizing employment and income opportunities through a revitalization of agriculture and expansion of domestic markets. In this decade, development activities were increasingly channelled through private voluntary organisations (PVOs), and aid shifted from individual projects to large programs.

1990s: Sustainability and Democracy

In the 1990s, USAID’s top priority became sustainable development, or helping countries improve their own quality of life. During this decade, USAID tailored development assistance programs to a country's economic condition. This meant that it focussed its efforts for developing countries to aid in an integrated package of assistance, as well as transitional countries to help them in times of crisis.

Countries with limited USAID presence received support through nongovernmental organisations (NGOs). USAID played a lead role in planning and implementing programs following the fall of the Berlin Wall in 1989. USAID programs helped establish functioning democracies with open, market-oriented economic systems and responsive social safety nets.

2000s: War and Rebuilding

The 2000s, brought more evolution for USAID and foreign assistance with government officials once again calling for reform of how the agency conducts business. With the Afghanistan and Iraq wars in full swing, USAID was called on to help those two countries rebuild government, infrastructure, civil society and basic services such as health care and education. The Agency began rebuilding with an eye to getting the most bang out of its funding allocations. It also began an aggressive campaign to reach out to new partner organizations – including the private sector and foundations – to extend the reach of foreign assistance.

USAID Today

Today, USAID staff work, with Samantha Power as the Administrator, in more than 100 countries around the world with the same overarching goals that President Kennedy outlined 50 years ago – furthering America's foreign policy interests in expanding democracy and free markets while also extending a helping hand to people struggling to make a better life, recover from a disaster or striving to live in a free and democratic country. It is this caring that stands as a hallmark of the United States around the world.

Its objective is to support partners to become self-reliant and capable of leading their own development journeys. It makes progress toward this by reducing the reach of conflict, preventing the spread of pandemic disease, and counteracting the drivers of violence, instability, transnational crime and other security threats. 

USAID promotes American prosperity through investments that expand markets for U.S. exports; create a level playing field for U.S. businesses; and support more stable, resilient, and democratic societies. It stands with people when disaster strikes or crisis emerges as the world leader in humanitarian assistance.

Disaster Relief

Some of the U.S. Government's earliest foreign aid programs provided relief in crises created by war. In 1915, USG assistance through the Commission for Relief in Belgium headed by Herbert Hoover prevented starvation in Belgium after the German invasion. After 1945, the European Recovery Program championed by Secretary of State George Marshall (the ""Marshall Plan"") helped rebuild war-torn Western Europe.
USAID manages relief efforts after wars and natural disasters through its Bureau for Humanitarian Assistance which is the lead federal coordinator for international disaster assistance.

Poverty Relief

After 1945, many newly independent countries needed assistance to relieve the chronic deprivation afflicting their low-income populations. USAID and its predecessor agencies have continuously provided poverty relief in many forms, including assistance to public health and education services targeted at the poorest. USAID has also helped manage food aid provided by the U.S. Department of Agriculture. Also, USAID provides funding to NGOs to supplement private donations in relieving chronic poverty.

Global issues

Technical cooperation between nations is essential for addressing a range of cross-border concerns like communicable diseases, environmental issues, trade and investment cooperation, safety standards for traded products, money laundering, and so forth. The USG has specialised agencies dealing with such areas, such as the Centres for Disease Control and the Environmental Protection Agency. USAID's special ability to administer programs in low-income countries supports these and other USG agencies international work on global concerns.

Environment

Among these global interests, environmental issues attract high attention. USAID assists projects that conserve and protect threatened land, water, forests, and wildlife. USAID also assists projects to reduce greenhouse gas emissions and to build resilience to the risks associated with global climate change. U.S. environmental regulation laws require that programs sponsored by USAID should be both economically and environmentally sustainable.

U.S. national interests

To support U.S. geopolitical interests, Congress appropriates exceptional financial assistance to allies, largely in the form of “Economic Support Funds” (ESF). USAID is called on to administer the bulk (90%) of ESF and is instructed: “To the maximum extent feasible, [to] provide [ESF] assistance ... consistent with the policy directions, purposes, and programs of [development assistance].”

Also, when U.S. troops are in the field, USAID can supplement the “Civil Affairs” programs that the U.S. military conducts to win the friendship of local populations. In these circumstances, USAID may be directed by specially appointed diplomatic officials of the State Department, as has been done in Afghanistan and Pakistan during operations against al-Qaeda.

U.S. commercial interests are served by U.S. law's requirement that most goods and services financed by USAID must be sourced from U.S. vendors.

Socioeconomic development

To help low-income nations achieve self-sustaining socioeconomic development, USAID assists them in improving the management of their own resources. USAID's assistance for socioeconomic development mainly provides technical advice, training, scholarships, commodities, and financial assistance. Through grants and contracts, USAID mobilises the technical resources of the private sector, other USG agencies, universities, and NGOs to participate in this assistance.

Programs of the various types above frequently reinforce one another. For example, the Foreign Assistance Act requires USAID to use funds appropriated for geopolitical purposes ("Economic Support Funds") to support socioeconomic development to the maximum extent possible.