VII. Expand the Circle of Development by Opening Societies and Building the Infrastructure of Democracy

A. Summary of National Security Strategy 2002

Helping the world’s poor is a strategic priority and a moral imperative. Economic development, responsible governance, and individual liberty are intimately connected. Past foreign assistance to corrupt and ineffective governments failed to help the populations in greatest need. Instead, it often impeded democratic reform and encouraged corruption. The United States must promote development programs that achieve measurable results – rewarding reforms, encouraging transparency, and improving people’s lives. Led by the United States, the international community has endorsed this approach in the Monterrey Consensus.

B. Current Context: Successes and Challenges

The United States has improved the lives of millions of people and transformed the practice of development by adopting more effective policies and programs.

• Advancing Development and Reinforcing Reform. The Administration pioneered a revolution in development strategy with the Millennium Challenge Account program, rewarding countries that govern justly, invest in their people, and foster economic freedom. The program is based on the principle that each nation bears the responsibility for its own development. It offers governments the opportunity and the means to undertake transformational change by designing their own reform and development programs, which are then funded through the Millennium Challenge Corporation (MCC). The MCC has approved over $1.5 billion for compacts in eight countries, is working with over a dozen other countries on compacts, and has committed many smaller grants to other partner countries.
• Turning the Tide Against AIDS and Other Infectious Diseases. The President’s Emergency Plan for AIDS Relief is an unprecedented, 5-year, $15 billion effort. Building on the success of pioneering programs in Africa, we have launched a major initiative that will prevent 7 million new infections, provide treatment to 2 million infected individuals, and care for 10 million AIDS orphans and others affected by the disease. We have launched a $1.2 billion, 5-year initiative to reduce malaria deaths by 50 percent in at least 15 targeted countries. To mobilize other nations and the private sector, the United States pioneered the creation of the Global Fund to Fight HIV/AIDS, Tuberculosis, and Malaria. We are the largest donor to the Fund and have already contributed over $1.4 billion.
• Promoting Debt Sustainability and a Path Toward Private Capital Markets. The Administration has sought to break the burden of debt that traps many poor countries by encouraging international financial institutions to provide grants instead of loans to low-income nations. With the United Kingdom, we spearheaded the G-8 initiative to provide 100 percent multilateral debt relief to qualifying Heavily Indebted Poor Countries. Reducing debt to sustainable levels allows countries to focus on immediate development challenges. In the long run, reducing debt also opens access to private capital markets which foster sound policies and long-term growth.
• Addressing Urgent Needs and Investing in People. The United States leads the world in providing food relief. We launched the Initiative to End Hunger in Africa, using science, technology, and market incentives to increase the productivity of African farmers. We launched a 3-year, $900 million initiative to provide clean water to the poor. We have tripled basic education assistance through programs such as the Africa Education Initiative, which will train teachers and administrators, build schools, buy textbooks, and expand opportunities inside and outside the classroom.
• Unleashing the Power of the Private Sector. The Administration has sought to multiply the impact of our development assistance through initiatives such as the Global Development Alliance, which forges partnerships with the private sector to advance development goals, and Volunteers for Prosperity, which enlists some of our Nation’s most capable professionals to serve strategically in developing nations.
• Fighting Corruption and Promoting Transparency. Through multilateral efforts like the G-8 Transparency Initiative and our policy of denying corrupt foreign officials entry into the United States, we are helping ensure that organized crime and parasitic rulers do not choke off the benefits of economic assistance and growth.

We have increased our overall development assistance spending by 97 percent since 2000. In all of these efforts, the United States has sought concrete measures of success. Funding is a means, not the end. We are giving more money to help the world’s poor, and giving it more effectively.

Many challenges remain, including:

• Helping millions of people in the world who continue to suffer from poverty and disease;
• Ensuring that the delivery of assistance reinforces good governance and sound economic policies; and
• Building the capacity of poor countries to take ownership of their own development strategies.

C. The Way Ahead

America’s national interests and moral values drive us in the same direction: to assist the world’s poor citizens and least developed nations and help integrate them into the global economy. We have accomplished many of the goals laid out in the 2002 National Security Strategy. Many of the new initiatives we launched in the last 4 years are now fully operating to help the plight of the world’s least fortunate. We will persevere on this path.

Development reinforces diplomacy and defense, reducing long-term threats to our national security by helping to build stable, prosperous, and peaceful societies. Improving the way we use foreign assistance will make it more effective in strengthening responsible governments, responding to suffering, and improving people’s lives.

1. Transformational Diplomacy and Effective Democracy

Transformational diplomacy means working with our many international partners to build and sustain democratic, well-governed states that will respond to the needs of their citizens and conduct themselves responsibly in the international system. Long-term development must include encouraging governments to make wise choices and assisting them in implementing those choices. We will encourage and reward good behavior rather than reinforce negative behavior. Ultimately it is the countries themselves that must decide to take the necessary steps toward development, yet we will help advance this process by creating external incentives for governments to reform themselves.

Effective economic development advances our national security by helping promote responsible sovereignty, not permanent dependency. Weak and impoverished states and ungoverned areas are not only a threat to their people and a burden on regional economies, but are also susceptible to exploitation by terrorists, tyrants, and international criminals. We will work to bolster threatened states, provide relief in times of crisis, and build capacity in developing states to increase their progress.

2. Making Foreign Assistance More Effective

The Administration has created the new position of Director of Foreign Assistance (DFA) in the State Department. The DFA will serve concurrently as Administrator of U.S. Agency for International Development (USAID), a position that will continue to be at the level of Deputy Secretary, and will have, consistent with existing legal requirements, authority over all State Department and USAID foreign assistance. This reorganization will create a more unified and rational structure that will more fully align assistance programs in State and USAID, increase the effectiveness of these programs for recipient countries, and ensure that we are being the best possible stewards of taxpayer dollars. And it will focus our foreign assistance on promoting greater ownership and responsibility on the part of host nations and their citizens.

With this new authority, the DFA/Administrator will develop a coordinated foreign assistance strategy, including 5-year, country-specific assistance strategies and annual country-specific assistance operational plans. The DFA/Administrator also will provide guidance for the assistance delivered through other entities of the United States Government, including the MCC and the Office of the Global AIDS Coordinator.

To ensure the best stewardship of our foreign assistance, the United States will:

• Distinguish among the different challenges facing different nations and address those challenges with tools appropriate for each country’s stage of development;
• Encourage and reward good government and economic reform, both bilaterally and through the multilateral institutions such as international financial institutions, the G‑8, and the Asia-Pacific Economic Cooperation (APEC);
• Engage the private sector to help solve development problems;
• Promote graduation from economic aid dependency with the ultimate goal of ending assistance;
• Build trade capacity to enable the poorest countries to enter into the global trade system; and
• Empower local leaders to take responsibility for their country’s development.

Our assistance efforts will also highlight and build on the lessons learned from successful examples of wise development and economic policy choices, such as the ROK, Taiwan, Ireland, Poland, Slovakia, Chile, and Botswana.