The world has changed dramatically over the past two decades. During this period the number of people living in market economies has increased fourfold. Globalization has integrated the world's markets for goods, services, capital, and ideas. The process has contributed to a historic spread of democracy and freedom. Hundreds of millions of men, women, and children are today healthier, better educated, and more prosperous. The evidence clearly shows that the United States and its foreign assistance programs have contributed much to this progress.
Yet, there remain many growing challenges. Many countries are struggling in their transition from authoritarianism, controlled economies, and closed markets. A number of the new democracies remain fragile. The HIV/AIDS pandemic is spreading, killing tens of millions, threatening those that survive with perennial poverty and hunger, and destabilizing governments. Famine continues to stalk entire regions, particularly in Africa.
U.S. development assistance, and USAID, must move in new directions. One such example is the President's bold new initiative, the Millennium Challenge Account (MCA), which is based on the premise that the United States should increase support to countries that demonstrate responsibility for their own development by ruling justly, investing in people, and encouraging economic freedom. While a new foreign assistance entity, the Millennium Challenge Corporation, will administer this program, USAID will embrace the MCA principles of rewarding good governance and performance in our priorities for development resources. Our primary focus will be to provide targeted assistance to those countries creating a sound economic environment, embracing democratic governance, and investing in their people. USAID will also fully support the President's transnational initiatives, including those on HIV/AIDS, access to water, climate change, and famine prevention.
At the same time, USAID will increase its attention toward failed and failing states, which the President's National Security Strategy recognizes as a source of our nation's most significant security threats - international terrorism and proliferation of weapons of mass destruction. The people of the United States are rightly proud of our nation's humanitarian contribution. In recent years, the majority of USAID's humanitarian work, ranging from assisting internally displaced persons to providing emergency food aid, has taken place in countries in the throes of crises wrought by the hands of men. U.S. efforts are particularly notable in a variety of post-conflict nations, such as Afghanistan. Maintaining high standards for the delivery of humanitarian assistance in post-conflict situations enables an early start to reconstruction efforts that are critical to sustaining large-scale repatriation and reintegration of refugees and displaced persons.
Yet, to prevent human suffering and protect our national security, we must devise bold, new approaches to arrest the slide of weak states toward failure. Such interventions will involve risk, and their success is certainly not assured. But, the greater risks to U.S. national security associated with inaction in such nations can no longer be overlooked.