U.S. Government Assistance Programs

Review of the Monterrey Consensus on Financing for Development
Review Session on International Financial and Technical Cooperation for Development: Key Developments Since Monterrey

Net United States disbursed official development assistance (ODA) has grown by more than $10 billion, to $23.5 billion in 2006. More important than increasing ODA, the U.S. has been changing the way that we deliver assistance, by supporting partner country ownership, promoting best practices to improve aid effectiveness, and leveraging private resources. In particular:

• The U.S. established the Millennium Challenge Corporation (MCC) in 2004 to focus resources where sound economic policies and good governance provide an enabling environment for economic growth. MCC has committed over $5.5 billion in compacts with 16 countries and has 18 threshold programs totaling some $400 million. These programs use development frameworks and program designs that are initiated and implemented by developing countries and ensure civil society participation.
• In 2006, USAID untied $3.5 billion, approaching 50% of the programs it managed that year. The Millennium Challenge Corporation (MCC) obligated about $2 billion in compacts during 2007; all of its programs are untied.
• To leverage additional financing for development, the U.S. created the Global Development Alliance (GDA) program in 2002 to partner with governments, businesses, foundations, and other non-governmental organizations. Through more than 600 alliances with over 1,700 partners, $2.1 billion in U.S. government resources has generated $5.8 billion in private resource commitments.
• The U.S. provided $1.4 billion in 2006 and over $6.2 billion total since 2000 in support of trade capacity building programs that help developing nations better integrate into and benefit from the global trading system.
• By promoting reforms to improve the business enabling environment, including access to finance, the U.S. assists developing countries in expanding opportunities for the private sector to succeed.
• At Monterrey, the U.S. pledged to increase ODA by 50% over 2000 levels by 2006. The 50% goal was achieved by 2003 and by 2006, the U.S. had increased ODA levels more than 130% over 2000 levels. President Bush announced at the Gleneagles G8 Summit that the United States would double assistance to Africa between 2004 and 2010, a pledge the U.S. is also on track to meet. U.S. assistance to Africa was $6.8 billion in 2006, more than 50% above the 2004 level.
• Annual U.S. ODA disbursements of $23.5 billion in 2006 are the second highest ever provided by any donor; the highest was $27.6 billion provided by the U.S. in 2005.
• U.S. foreign assistance reform has enabled the U.S. to align development assistance with established strategies and manage for results more systematically through a results-oriented planning framework that takes into account each country’s conditions and progress in transforming itself. This framework also increases the transparency of our assistance allocation process, promoting accountability.

Issue Paper: Review Session on International Financial and Technical Cooperation for Development: Key Developments Since Monterrey