| FY 2007 International Affairs (Function 150) Budget Request -Table of Contents Released by the Bureau of Resource Management February 6, 2006 Foreign Operations, Export Financing, and Related Programs (Foreign Operations) I. Export and Investment Assistance ($ in thousands) FY 2005 Actual FY 2006 Estimate FY 2007 Request Export-Import Bank of the United States Loan Subsidy 59,322 99,000 26,382 Administrative Expenses 72,614 72,468 75,234 Inspector General - 990 988 Direct Loans, Negative Subsidy (26,000) (50,000) (45,000) Total, Export-Import Bank of the United States 105,936 122,458 57,604 Overseas Private Investment Corporation Administrative Expenses 42,542 41,851 45,453 Net Offsetting Collections (252,260) (223,000) (225,000) Credit Subsidy 23,808 20,073 20,035 Net Negative Budget Authority, OPIC (185,910) (161,076) (159,512) Trade and Development Agency 51,088 50,391 50,300 Total, Export and Investment Assistance (28,886) 11,773 (51,608) Export-Import Bank of the United States (Ex-Im)
The FY 2007 request seeks $26.4 million for loan programs and $75.2 million for administrative expenses. Such funding, in combination with program budget authority carried over from prior years, will support $17.5 billion in lending activity. Ex-Im Bank is the official export credit agency of the United States. The purpose of Ex-Im Bank is to facilitate U.S. exports by providing competitive export financing in situations where U.S. exporters: (1) are facing foreign competition backed by officially supported financing or (2) the private market is unwilling or unable to offer this financing. In either case, Ex-Im Bank financing is predicated on a determination that reasonable assurance of repayment exists. Ex-Im Bank enables U.S. companies — large and small — to turn export opportunities into sales that help to maintain and create U.S. jobs and contribute to a stronger national economy. Ex-Im Bank provides its export credit support through direct loan, loan guarantee, and insurance programs. The Bank actively assists small and medium-sized businesses. Overseas Private Investment Corporation (OPIC) In FY 2007 the Overseas Private Investment Corporation (OPIC) will focus its efforts on quality projects that are highly developmental, based on both sector and geographic location. Based on U.S. development and foreign policy priorities, in FY 2006 OPIC will place special emphasis on small business, investments in Africa, the broader Middle East, including Iraq, Mexico and CAFTA countries, and continue to increase private sector cooperation and increase the availability of housing for the developing world. Private sector investment support provided by OPIC is market driven, and as a result, efficiently aligns government resources with projects that are most likely to drive economic growth. For many countries that have moved beyond basic humanitarian assistance, OPIC is an effective and efficient way to promote private sector growth. OPIC's goal is to generate "additionality" on each transaction it conducts, meaning OPIC is able to add value to every investment it supports. From its estimated net offsetting collections of $225 million in FY 2007, OPIC is requesting $45.5 million for administrative expenses and $20 million for credit funding. This amount will support over $1.6 billion in new direct loans and loan guaranties at a gross subsidy rate of about 1 percent. OPIC is a self-sustaining agency that mobilizes American private investment by providing political risk insurance, project finance, and investment funds products in 153 developing nations and emerging markets around the world. Trade and Development Agency (TDA) The Administration is requesting $50.3 million for USTDA in FY 2007. This request maintains the Agency's ability to spur economic development and advance U.S. commercial interests in developing and middle-income countries. TDA provides a bridge to U.S. technical know-how and experience for developing and middle-income countries. The focus of the Agency is unique in that it creates public-private partnerships in response to project sponsor needs and priorities. TDA funds help identify and prepare projects for implementation that will establish the infrastructure necessary for economies to expand. At the same time, the Agency's activities develop trade partnerships by enhancing the ability of U.S. firms to conduct business overseas. The Agency uses various tools to facilitate U.S. business opportunities in the international marketplace. This support comes in the form of technical assistance, feasibility studies, orientation visits, training grants and conferences. The agency’s FY 2007 budget request encompasses USTDA’s assistance programs that support key trade and foreign policy objectives of the Administration, including: 1) reconstruction efforts and economic development in Iraq, Afghanistan and other areas of conflict; 2) assistance to the Middle East to enhance democracy-building efforts throughout the region; 3) assistance to implement international transportation safety and security standards; 4) capacity building activities in areas in which the United States has engaged in bilateral and multilateral trade negotiations, particularly countries party to the Central American-Dominican Republic Free Trade Agreement; and 5) economic growth in Africa through activities that promote the development goals of the African Growth and Opportunity Act. II. Bilateral Economic Assistance A. United States Agency for International Development ($ in thousands) FY 2005 Actual FY 2006 Estimate FY 2007 Request Child Survival and Health Programs Fund 1,562,400 1,644,350 1,433,000 Development Assistance 1,448,320 1,508,760 1,282,000 International Disaster and Famine Assistance 574,896 417,680 348,800 Transition Initiatives 48,608 39,600 50,000 Development Credit Authority Subsidy - Appropriation - - 5,000 Development Credit Authority - Admin. Exp. 7,936 7,920 8,400 Total, Development Credit Authority 7,936 7,920 13,400 USAID Operating Expenses 637,456 623,700 678,826 USAID Capital Investment Fund 58,528 69,300 131,800 USAID Inspector General Operating Expenses 37,220 35,640 38,000 Total, United States Agency for International Development 4,375,364 4,346,950 3,975,826 Overview
Today more than ever, U.S. foreign policy toward the developing world plays a vital role in the global balance between conflict and peace. U.S. national security challenges are increasingly complex, and the role of development is recognized as pivotal. This is reflected in President Bush’s National Security Strategy of the United States, issued on September 17, 2002, which for the first time elevated development as the third component of U.S. national security, alongside defense and diplomacy.
The FY 2007 budget request reflects the President’s recognition that development makes a vital contribution to enhancing U.S. national security. It acknowledges that foreign assistance supports several goals, including: promoting transformational development, stabilizing fragile states, supporting strategic states, responding to humanitarian needs, and addressing global issues and special concerns. The budget continues an approach to allocating Development Assistance funds to improve the effectiveness of foreign assistance by rewarding countries that are needy and good performers. It also focuses some Development Assistance and Child Survival and Health funds on encouraging stability, security, reform and capacity development in fragile states. Highlights of the budget include: • Maintaining our strong support for countries on the front lines in the War on Terrorism, especially Afghanistan, Pakistan, and Sudan, as well as other front-line states in Asia, the Near East, and Africa. • Supporting the President’s initiative to accelerate the fight against malaria, increasing attention to avian influenza – both for surveillance and improving developing countries’ ability to cope with an outbreak, turning the tide against HIV/AIDS, increasing treatment of tuberculosis, while continuing our support for other health priorities. • Maintaining U.S. leadership role in promoting democracy and good governance in the developing world. • Rewarding good performers such as Indonesia, Zambia and Guyana - helping them to move toward eligibility for the Millennium Challenge Account by pursuing transformational development. • Addressing the sources of fragility in certain programs to lay the foundation for lasting long-term country development. • Growing countries’ economies through trade opportunities. Expanding local job opportunities to reduce youth unemployment and susceptibility to criminal and terrorist recruitment. • Rebuilding USAID’s human capacity by addressing a critical deficiency in technical staff and establishing a reconstruction and stabilization reserve. Child Survival and Health Programs Fund (CSH) The FY 2007 request of $1.433 billion for the Child Survival and Health Programs Fund (CSH) reflects the President’s continuing commitment to improved health interventions that address critical health, HIV/AIDS, nutrition and family planning needs worldwide. Investing in the health of the world’s population, addressing global issues and other special concerns, stabilizing fragile states, and promoting transformational development are all goals supported by funds from this account. CSH funding supports programs that expand basic health services and strengthen national health systems to significantly improve people’s health, especially that of women, children, and other vulnerable populations. A major focus for the use of these funds is in sub-Saharan Africa. As HIV/AIDS, malaria, and other infectious diseases continue to threaten the health of families and children in developing countries worldwide, CSH-funded programs work to eliminate these threats. • The President’s Emergency Plan for AIDS Relief (PEPFAR) focuses on fifteen African, Caribbean and Asian countries. USAID will continue to play a significant role in implementing PEPFAR, which is managed by the Global AIDS Coordinator. Funding for the focus countries is being requested within the Global HIV/AIDS Initiative (GHAI) account. CSH-funded HIV/AIDS programs ($325 million) will focus on prevention, care, and treatment efforts, and the support of children affected by AIDS in non-focus countries. • The USAID contribution to the Global Fund to Fight AIDS, TB, and Malaria is $100 million. • Other Infectious Diseases ($382 million) programs concentrate on the prevention and control of malaria, tuberculosis, avian influenza, and programs to combat anti-microbial resistance and disease surveillance. Geographically, the focus is on sub-Saharan Africa, the Caribbean Basin, India, Indonesia and Cambodia. This request includes $225 million for malaria programs, including $135 million in new funding to support the President’s Malaria Initiative that will be expanded from three to seven high-burden countries in FY 2007. Also included is $55 million for continuing programs to combat avian influenza pandemic. • Child Survival and Maternal Health ($323 million) programs will continue to address the primary causes of maternal and child mortality, and improve health care systems, primarily in sub-Saharan Africa and South Asia. This funding targets key investments such as immunizations, pneumonia and diarrhea prevention and treatment, oral rehydration, polio eradication, micronutrient deficiencies, antenatal care and safe birthing, nutrition, and breastfeeding as a means to reduce the burden of disability and disease. • Vulnerable Children ($9 million) funding supports the Displaced Children and Orphans Fund which strengthens the capacity of families and communities to provide care, support, and protection of orphans, street children, and war-affected children. • Family Planning and Reproductive Health ($294 million) programs will help expand access to information and services regarding family planning practices. Such access will help reduce unintended pregnancies, improve infant and child health, reduce mortality rates, decrease maternal deaths associated with childbirth, and reduce abortion. These programs are integrated with programs that protect human health. The FY 2007 request of $1.282 billion for Development Assistance will fund programs to promote transformational development in stable developing countries which are needy and are committed to promoting economic freedom, ruling justly and investing in people. DA funds will also support programs in fragile states that enhance stability and develop key institutional capacities for lasting recovery, as well as global issues and concerns related to sustainable development. This DA request will promote economic freedom through: The request will support countries’ efforts to govern justly, including support for elections, political party development, rule of law, security, anti-corruption, human rights and conflict prevention, and programs to help prevent trafficking of persons. Funds will support investing in people, particularly through education and training programs, including basic education programs such as the enhanced African Education Initiative ($100 million) announced at the 2005 G-8 Summit, and higher education and training programs. An important long-term investment in people, education funds will focus on two broad but complementary objectives: equitable access to quality basic education and increasing knowledge and skills for a productive workforce. DA funding will continue to be used to support programs that address global climate change, such as the Congo Basin Forest Partnership. Continued funding for the Global Development Alliance ($10 million) will mobilize resources by creating alliances between the public and private sectors in support of the Agency’s transformational development goal.
International Disaster and Famine Assistance (IDFA)
The FY 2007 request of $348.8 million will provide funds for the management of humanitarian relief, rehabilitation, and reconstruction assistance to countries struck by natural and man-made disasters, and support for disaster mitigation, prevention, and preparedness. The request funds the purchase of commodities including temporary shelter, blankets, supplementary food, potable water, medical supplies, and agricultural rehabilitation aid, including seeds and hand tools. Approximately $163 million of the FY 2007 IDFA funding requested is currently planned to meet humanitarian and post-conflict needs in Sudan. The request also includes $20 million for famine prevention and relief for contingency needs and support of early intervention to either pre-empt famine or mitigate the impact. The FY 2007 request of $50 million for the Transition Initiatives account will be used by the Office of Transition Initiatives (OTI) to address the opportunities and challenges facing conflict-prone countries and those making the transition from initial crisis stage of a complex emergency (frequently addressed by the Office of Foreign Disaster Assistance using IDFA funds) to the path of sustainable development. OTI collaborates closely with the Department of State, the National Security Council, the Department of Defense, and USAID’s regional bureaus in the selection of countries with high foreign policy priority for transition assistance and in the design and monitoring of OTI’s programs. OTI’s efforts to advance peace and stability include support for demobilization and re-integration of ex-combatants, community self-help programs that reduce tensions and promote grass-roots democratic media, and conflict resolution measures. Development Credit Authority (DCA) Credit promotes broad-based economic growth in developing and transitional economies. The Development Credit Authority (DCA) allows USAID to use credit as a flexible development tool for a wide range of development purposes. DCA augments grant assistance by mobilizing private capital in developing countries for sustainable development projects, thereby supporting the capacity of host countries to finance their own development. The FY 2007 request includes $21 million in transfer authority to provide loan guarantees in every region and in every sector targeted by USAID. In addition, USAID requests $5 million in appropriated funds for the Africa Housing and Infrastructure Facility (AHIF), up to $2 million of which may be used for project development costs. This innovative credit facility will build on USAID's experience with DCA and will support the subsidy costs of partial guarantees for private sector financing of water, infrastructure, and housing projects in Africa. The AHIF also will enhance the effectiveness of USAID's response to Presidential Initiatives such as Water for the Poor. The request also includes $8.4 million for credit administrative costs. In accordance with the Federal Credit Reform Act of 1990, this funds the total cost of development, implementation, and financial management of the DCA program, as well as the continued administration of the Agency’s legacy credit portfolios which amount to more than $22 billion. The FY 2007 request ($678.8 million) for USAID OE covers administrative costs of managing approximately $8 billion in program funds. The funding will support management priorities to rebuild human capacity, enhance security and physical infrastructure, and improve information technology systems. The USAID OE request will help rebuild its human capacity by hiring U.S. direct-hire staff to address critical staffing deficiencies in the technical areas and establish a reconstruction and stabilization reserve. The additional staff will strengthen depleted technical ranks in the areas of health; economic growth and trade; education; and crisis, stabilization and governance, and enhance capacity to support large stabilization and reconstruction programs following conflict and disaster. Funds requested will enhance security worldwide for USAID operations and physical infrastructure to better protect Agency employees and facilities against global terrorism and national security information against espionage. These funds will also support information technology (IT) systems, infrastructure and architecture critical to the operational needs of USAID staff. The FY 2007 Capital Investment Fund request ($131.8 million) uses no-year authority to provide USAID with greater flexibility to manage investments in technology and facility construction. The request provides $102.5 million for overseas facility construction. This will fund the third year of the Capital Security Cost Sharing Program to support the construction of USAID facilities on new Embassy compounds and the relocation of USAID/Guatemala to a secure interim office building. These funds will support USAID’s ability to locate staff in secure work environments. The remaining $29.3 million will fund investments in Information Technology for the continued implementation of worldwide accounting and procurement systems, full participation in E-Government initiatives, and infrastructure collaboration and consolidation between the Department of State and USAID. USAID Inspector General Operating Expenses The FY 2007 request ($38 million) for the USAID Office of Inspector General covers salaries, operating expenses, and benefits for staff, and supports critical audit and investigative coverage for USAID. The OIG assists USAID to implement its strategies, providing staff with information and recommendations to improve program and operational performance. The office also works with USAID to protect and maintain the integrity of the Agency and its programs. B. Other Bilateral Economic Assistance ($ in thousands) FY 2005 Actual FY 2006 Estimate FY 2007 Request Economic Support Fund 3,914,592 2,621,025 3,214,470 Assistance for Eastern Europe and the Baltic States 393,427 357,390 273,900 Assistance for the Independent States of the Former Soviet Union 625,520 508,860 441,000 Tsunami Recovery and Reconstruction Fund 656,000 - - Total, Other Bilateral Economic Assistance 5,589,539 3,487,275 3,929,370 Africa -- $164.3 million is requested for programs in sub-Saharan Africa. These funds will assist countries to recover from conflict and bring about enduring peace; advance the development of democracy, including support for human rights and rule of law; promote economic stability, sustainable development, and U.S. investment opportunities in Africa; and combat terrorism and other forces that undermine prosperity and stability in the region. • Sudan -- $60 million to support implementation of the Comprehensive Peace Agreement to ensure a full transition to a just peace. Funds will be used to provide administrative, technical, legal, and operational support, and help build civil society and strengthen democracy. The ESF will also support development in the areas of agriculture, health, and education, and be used in the reconstruction of roads, bridges, schools, and other infrastructure needs. In addition, funds will be used to support the resolution of conflict and implementation of peace agreements in Darfur and eastern Sudan, as needed. • Indonesia - $80 million will strengthen counter-terrorist initiatives such as preventing financial crimes and anti-money laundering; improve the quality of basic education for Indonesia's children in support of the President’s initiative; promote good governance, democracy and human rights; promote economic growth and prosperity; and continue conflict mitigation and resolution efforts, including support for Aceh peace accord implementation. Europe and Eurasia -- $19.5 million is requested for programs that promote peace and reconciliation and contribute to the stability of the region. • Cyprus - $15 million will support the peace process and eventual reunification of the island by increasing bicommunal efforts to build support for solution after the failure of the United Nations settlement plan in referenda in April 2004. The funding will also continue to support activities to strengthen the Turkish Cypriot economy and economic integration of the island. Near East -- $1.64 billion is requested to support regional stability in the Middle East, encourage development, and encourage a comprehensive peace between Israel and its neighbors; to promote political, economic, and educational reform throughout the region; and to combat the roots of terrorism by targeting the economic despair and lack of opportunity that are exploited by extremists. • Egypt - $455 million in accordance with the ESF phase-down plans. Funds will support economic reform, specifically reforms in the financial sector, as well as various projects in democracy and governance, health, education, private sector development, environment and infrastructure. South Asia: $982.5 million is requested to help stabilize this critical region through economic reconstruction and development, earthquake reconstruction, demobilization, democracy building, education, training, and public diplomacy programs. • Afghanistan: $610 million to bolster progress toward stability, prosperity and democracy. The funds will be used to strengthen nascent democratic institutions; complete secondary roads and other critical infrastructure, including power generation and transmission; provide the central government with the essential tools to deliver basic services, pay salaries and extend its authority to the provinces; continue funding for provincial reconstruction team (PRT) projects to extend reconstruction into difficult areas; support alternative livelihoods in rural areas to reduce poppy cultivation; and assist Afghan women and girls. Western Hemisphere – $152.1 million to promote the Administration’s objectives in the Western Hemisphere to bolster security, strengthen democratic institutions, promote prosperity, and invest in people. This request is based on a larger hemispheric commitment, defined through the Summit of the Americas process. Our Summit commitment is to democracy, free markets, economic integration, and a common policy agenda with the aim of providing the benefits of democracy to the peoples of the hemisphere. The programmatic focus will continue to be democracy (including anti-corruption), trade-led economic growth, and the fight against organized crime and terrorism. • Haiti: $50 million is requested for continued support to help new Haitian authorities (a President and Parliament expected to be elected and government designated in the first half of FY 2006) to consolidate democratic gains and support long-term stability and development. ESF will provide assistance to key ministries, newly elected legislators and local government officials. Anti-corruption programs will promote systems for transparency, accountability and responsiveness; assistance also will strengthen the justice sector and civil society organizations. Other activities will generate short-term employment opportunities and incomes for vulnerable populations, expand access to credit for small and micro-entrepreneurs, and support the government’s efforts to provide an enabling environment for private sector growth and long-term job creation. Global – A total of $88.5 million is requested to promote democracy and universal human rights; to promote environmental stewardship and advance U.S. interests in this area; to bring together individuals of different ethnic, religious, and political backgrounds from areas of civil conflict and war; and to prevent the trafficking in persons and protect the victims of trafficking. • Asia-Pacific Partnership - The United States, China, India, Korea, Australia, and Japan launched the Asia-Pacific Partnership in 2006 to promote clean development, enhance energy security, and address climate change. This initiative will advance U.S. leadership on the interrelated issues of energy and climate through public-private collaboration. Partners will work to deploy cleaner energy technologies and practices in developing countries that are among the largest global emitters of greenhouse gases. $26 million in ESF will support projects such as: rural village deployment of cleaner energy technologies, thermal power plant operational and emission improvements, hydro and other renewable energy power promotion, mining and industrial process efficiency and emission improvements, and civil aviation and public transportation efficiency improvements. Assistance for Eastern Europe and the Baltic States (SEED) U.S. assistance will continue to close the circle of violence that plagued Southeast Europe in the 1990s by focusing on integrating Southeast Europe into the Euro-Atlantic community with its values of democracy, rule of law, and individual freedom. The governments of the region are committed to European integration; some are further along than others. These fragile democracies and struggling market economies still benefit from U.S. support. Promoting democratic reform and stability, economic development, and rule of law will help move them more rapidly to membership in the European Union and deepen their relationship with NATO. The FY 2007 $273.9 million request will support programs that fight international crime, trafficking, and corruption; build socio-economic bridges between ethnic communities; and consolidate the region’s democratic and economic progress. Specific country requests are explained below: • Albania ($20 million) - Albania faces daunting economic challenges and pervasive crime and corruption. Nevertheless, this predominately Muslim country continues to be a staunch U.S. ally, contributing to Operation Enduring Freedom and Operation Iraqi Freedom. FY 2007 funding for Albania will focus on building democratic institutions and promoting private-sector-led growth in an economy that desperately needs legitimate business activity. Assistance will also build Albania's capacity in health sector reform and fight trafficking, organized crime, and corruption. • Bosnia and Herzegovina ($31 million) - Bosnia and Herzegovina continues to require significant assistance as it gains greater autonomy from the international community. Bosnians will take on greater responsibility in 2006, expanding their ownership of economic, democratic, social, and judicial reforms and institutions. SEED assistance will continue to help develop key state-level institutions, civil society organizations, and viable municipal-government structures as Bosnia transitions to autonomous self-government. SEED-funded programs will focus on creating for the Catholic, Muslim, and Orthodox communities a single economic space with a strong private sector, an investor-friendly climate, and a sound financial and business regulatory environment; developing a fair and efficient judicial system; and providing training to develop local capacities. SEED programs will also expedite development of state institutions that can cope with fighting organized crime, trafficking, and terrorism, and put Bosnia firmly on the path to Euro-Atlantic integration. • Kosovo ($79 million) - FY 2007 will be critical for Kosovo, as its final status process has begun. FY 2007 funds will help Kosovo build capacity to adjust to the significant challenge of self-governance as the international community continues to hand over nearly all aspects of governance to Kosovar institutions. Regardless of the outcome of status negotiations, the United States will need to continue its key assistance programs, including improving the performance of Kosovo’s ministries; developing the judicial and law enforcement system; supporting local government, media, and civil society groups; driving growth through economic policy reform and support to key industries in Kosovo; and encouraging a multiethnic Kosovo by strengthening communities that embrace tolerance. The U.S. will also continue to support an international police presence to provide interim security while local capacity is being developed. • Macedonia ($27 million) – Stability and security in Macedonia have improved dramatically since the ethnic conflict in 2001 between Muslim Albanians and Orthodox Macedonians. The Ohrid Framework Agreement that ended the conflict set a standard for the region. Continued, sustained assistance is needed to ensure the Agreement’s full, practical implementation. With improvements in stability, the emphasis of U.S. assistance is to further enhance the government’s ability to combat cross-border crime, strengthen rule of law, and advance macroeconomic reforms to secure Macedonia’s future on the path of Euro-Atlantic integration. The EU announced in late 2005 that Macedonia is now a candidate country for enlargement, but did not name a target date. Negotiations on EU accession will not get underway until reforms produce irreversible results. • Serbia and Montenegro ($62 million Serbia; $8.5 million Montenegro) - Serbia and Montenegro (SaM) remains the linchpin of the Balkans: maintaining a robust assistance program there is fundamental to the success of U.S. foreign policy in the region. Assistance to SaM is focused on accelerating SaM’s progress toward Euro-Atlantic integration. SEED funds help SaM's fragile reformist leadership keep political and economic reform on track. Major work remains in the areas of rule of law, privatization, economic growth, law enforcement, and building democracy – all are crucial to stabilizing SaM and making it a positive player in the region. SEED programs increasingly target youth and small and medium enterprise development, to ensure that a broad range of citizens directly receive the benefits of U.S. assistance. These programs are critical to helping ease the transition that will occur as a result of the final determination of Kosovo’s status. • Regional SEED ($17.9 million) - Regional SEED funds help restore the ties among Southeast European countries that were broken by the wars of the 1990s. U.S. assistance is helping reduce barriers to trade, harmonize financial laws and practices, link industrial and business sectors between countries, and develop a common electricity and natural gas market for Southeast Europe that will eventually link to the EU. U.S. assistance also supports Balkan-wide grants programs designed to consolidate democratic reform and build ties between communities torn by war; programs develop history workbooks for secondary schools, enable local NGOs to work on a regional basis, and help countries work on common problems like trafficking in persons, organized crime, and corruption. U.S. funding for the Southeast Europe Cooperation Initiative (SECI) Transborder Crime Center in Bucharest, Romania, supports operational coordination between U.S. and Balkan Customs and Police representatives. Regional SEED funds also cover Congressional directives in the fields of health and HIV/AIDS, and advanced research and language training opportunities for U.S. scholars studying Southeast Europe under the Program for Research and Training on Eastern Europe and the Independent States of the Former Soviet Union (Title VIII). • Regional SEED - OSCE ($28.5 million) - The SEED regional account also funds U.S. voluntary contributions toward the costs of maintaining Organization for Security and Cooperation in Europe (OSCE) field missions in Southeast Europe. OSCE field missions undertake high-priority responsibilities in conflict prevention and post-conflict democratization and stabilization. Funds are also used to pay the salaries of American citizens seconded to the OSCE Secretariat and field missions, as well as the travel costs of Americans serving as election monitors for the OSCE’s Office of Democratic Institutions and Human Rights. In addition, these funds support the U.S. Contributions to the Office of the High Representative (OHR) in Bosnia and Herzegovina and security costs for high-ranking U.S. citizen officials at the OHR and OSCE field mission in Sarajevo. Assistance for the Independent States of the Former Soviet Union (FREEDOM Support Act, or FSA) The past year witnessed the consolidation of reformist democratic forces in Georgia, the consolidation and then fracturing of reformists in Ukraine, and the Kyrgyz Republic’s on-going struggle to consolidate the gains from its "Tulip Revolution." Meanwhile, Russia moved to further restrict democratic freedoms, and Uzbekistan undertook moves consistent with a realignment towards Russia, including the signing of a treaty committing Russia and Uzbekistan to mutual self defense. While much work remains to expand to the rest of the economy the benefits of petroleum-driven high growth rates in Russia and Kazakhstan, the need for further U.S. Government economic reform assistance there is limited. FY 2006 was the last year of funding for economic reform programs in Russia, with the exception of limited assistance in geographically defined areas of special importance. If current assumptions hold, funding for economic reform in Ukraine and Kazakhstan will phase out in FY 2009. FSA assistance will be reduced and/or reallocated as the process unfolds. Georgia’s and Armenia’s reform efforts are now backed by Millennium Challenge Corporation (MCC) Compacts. Ukraine, Moldova, and the Kyrgyz Republic were recently recognized with MCC Threshold status. FSA assistance will help to leverage the MCA funds to sustain reform efforts in these countries. Many of the serious challenges that confronted the region in FY 2006 remain. Weak democratic institutions and a lack of economic opportunity in Central Asia are creating conditions where corruption is endemic and Islamic extremism can thrive. A flood of cheap heroin from Afghanistan continues to transit Central Asia, the Caucasus, and Russia, leaving behind a destructive legacy of police corruption, drug addiction, and the spread of HIV/AIDS. In far too many Eurasian states, an all-powerful executive restricts civil and political rights, and rule of law is either weak or nonexistent. This year has seen backsliding in progress toward democracy and human rights in Russia and Central Asia. Health and education-related indicators (life expectancy, child mortality, secondary school enrollment, etc.) continue to deteriorate throughout the region, calling into question these countries’ ability to sustain economic growth. U.S. assistance is expected to be needed to address these challenges for several years to come. Specific country requests are explained below: • Armenia ($50 million) - One of Eurasia’s leading performers in economic and political reform, Armenia was recently approved to sign an MCC Compact. Despite the gains produced by economic reforms, however, poverty remains widespread in Armenia. The key now is effective implementation of reform measures, particularly in fighting corruption. Recent problems in the constitutional referendum process highlight the continuing need for democracy assistance. FY 2007 assistance will support efforts to increase stability in order to facilitate the settlement of regional conflicts, encourage free and fair parliamentary and presidential elections in 2007 and 2008, fight corruption, encourage government accountability and independent media, and reduce poverty, particularly through agricultural reform. • Azerbaijan ($28 million) - As a moderate Muslim country providing key assistance in the Global War on Terrorism and Operation Iraqi Freedom, the Caspian Sea littoral state of Azerbaijan is strategically significant. Recent problems with parliamentary elections and the agreement to re-run some contested seats highlight both the need for continued reform and the possibilities for progress in Azerbaijan. U.S. assistance will support the reform of economic institutions, encourage economic diversification, promote transparency and effectiveness in budget management, and support private enterprise development. Programs will encourage democratization and the development of civil society, improve border security and law enforcement capabilities, and fight corruption and trafficking in persons. • Belarus ($10 million) - Belarus is out of step with its European Union (EU) neighbors and progress toward Euro-Atlantic integration made by Ukraine and Moldova. So long as President Lukashenko remains in power, there is little hope for genuine political or economic reform and very limited official receptivity to foreign assistance. A main focus of U.S. assistance will continue to be support for democratization. Depending on the outcome of the March 2006 presidential election, the thrust of FY 2007 assistance will be either on cementing democratic gains and facilitating economic reform or alternatively on building civil society as a catalyst for democratic change, expanding access to independent information, including through broadcasting from outside the country, and strengthening democratic political parties. U.S. civil society assistance will maintain a lifeline for NGO activists and extend support for small business associations and NGOs that address trafficking in persons, HIV/AIDS, and Chornobyl relief. • Georgia ($58 million) - The dramatic Rose Revolution of 2004 initiated the establishment of democratic institutions and the rule of law that now serve as an example for the region. Even so, significant challenges remain, including the need to increase engagement between Georgia and the separatist regions of South Ossetia and Abkhazia, decrease Georgia’s energy dependence on Russia, and consolidate improvements in democracy and governance. The MCC is set to provide $295 million to fund major infrastructure and economic development projects beginning in 2006. These efforts will be supported by FSA assistance that will promote increased interaction between Georgians and the Abkhaz and South Ossetians, encourage democratic institution building and judicial reform, strengthen local government, improve border security, and support reform in the energy sector. • Kazakhstan ($19 million) - Kazakhstan’s economy enjoys continued strong growth, focused narrowly on the petroleum sector. A draft cost-sharing agreement with the Government of Kazakhstan (GOK) on diversified private sector development is expected to result in the GOK making direct contributions toward the cost of technical assistance. An important focus will be on developing small and medium-sized enterprises in the poorest areas of southern Kazakhstan. Democracy remains a key area of assistance in the aftermath of last year’s flawed presidential election, which underscored the need for electoral reform as well as improvements in the environment for independent media and NGOs. Assistance programs also address narcotics trafficking, border security, and health. • Kyrgyz Republic ($32 million) – Following the Kyrgyz Republic’s democratic breakthrough in 2005, this moderate Muslim country continues to be a key partner in Operation Enduring Freedom through its provision of an air base for U.S. forces. Working in tandem with the newly approved MCC Threshold program for the Kyrgyz Republic, FSA assistance will work to improve democratic institutions and address corruption, economic development, and social issues that could put democratic progress at risk. FSA assistance will also help secure Kyrgyz borders and fight the growing drug trade from Afghanistan and the related scourges of corruption, addiction, and infectious diseases. • Moldova ($16 million)--The current government has begun to reverse earlier missteps limiting private sector economic activity and has reaffirmed its European orientation. Moldova has been selected for the MCC Threshold program, which will focus largely on fighting corruption. FSA assistance will focus on assisting Moldova to meet EU standards and accelerate its integration into EU-oriented regional structures of Southeastern Europe as a means of anchoring Moldova's reforms. Moldova is the poorest country in Europe, and broadening the benefits of its recent economic growth is necessary to ensure that it continues to move towards Europe. FSA assistance will be directed towards job creation programs and promoting the rule of law, with an emphasis on combating corruption and trafficking in persons. • Tajikistan ($22 million) – Tajikistan has a moderate Muslim population and is a key frontline supporter of OEF. Tajikistan’s poverty and location in the region make it one of our most important venues for countering extremism. Presidential elections in November 2006 will provide a further opportunity for development of civil society. Much remains to be done to reform the economy, develop natural resources, fight infectious diseases, and improve education. Helping Tajikistan stem the increasing drug flow from Afghanistan and achieve effective control of the Tajik-Afghan border will continue to be a priority. • Turkmenistan ($5 million) - Given Turkmenistan’s strategic location bordering Afghanistan and Iran, and its substantial natural gas reserves, our main interest is to promote civil society and human rights – including religious freedom – and to ensure that it does not become a failed state. U.S. assistance provides vital support to significant U.S. security interests, helps sustain the country’s few active civil society organizations, and makes a difference in improving health and providing some of the only outside educational opportunities for Turkmenistan’s population. In addition, our FSA funding directly supports human rights advocacy, and is the critical lifeline for groups and individuals pursuing these goals. • Ukraine ($85 million) – Ukraine remains a strategically important country and was at one point one of the largest coalition partners in OIF. Success of democratic reform in Ukraine will be a leading indicator of prospects for the region. The focus of U.S. assistance in FY 2007 will be on helping consolidate democratic progress since the Orange Revolution and facilitating necessary economic reforms prior to the phase-out of economic sector assistance. In FY 2007, the U.S. plans to spend at least $20 million toward the U.S. pledge for the construction of a shelter over the Chornobyl nuclear site. Given Ukraine's still-fragile democracy, U.S. assistance efforts will continue to focus on support for civil society, rule of law, and combating corruption. Ukraine was selected for an MCC Threshold program, which is expected to focus on governance and anti-corruption reforms. • Uzbekistan ($15 million) - The Government of Uzbekistan perceived the democratic breakthroughs in Georgia, Ukraine, and the Kyrgyz Republic as threats to its hold on power, and reacted by cracking down on civil society and public demonstrations – violently in the case of Andijon. It also terminated an agreement that allowed U.S. forces to use an airbase for operations in Afghanistan. Given these realities, no funding is being requested for programs that involve the Uzbek Government. The U.S. will continue to provide assistance to the country’s nongovernmental sector, including programs to support civil society, promote religious moderation, improve health care, fight diseases, improve education, and develop micro-credit and agribusiness. • Regional FSA ($29.4 million) - Eurasia Regional funds will continue to support conflict mitigation and confidence building activities in the Caucasus. Regional funding will also support analytical efforts to track progress towards transition, mitigation of cross-border health problems, U.S. Trade and Development Agency feasibility studies to facilitate U.S. investment and exports to the region, and as projects carried out by regional organizations, such as the Georgia-Ukraine-Azerbaijan-Moldova (GUAM) group. The regionally funded Program for Research and Training on Eastern Europe and the Independent States of the Former Soviet Union (Title VIII) will provide advanced research and language training opportunities for U.S. scholars studying the Eurasian countries. • Central Asia Regional ($1.6 million) - Central Asia Regional funds will continue to support ongoing cross-border efforts, such as water-resource management projects, conflict mitigation and confidence building in Central Asia. • Regional FSA - OSCE ($12 million) - The FSA regional account also funds U.S. voluntary contributions toward the costs of maintaining OSCE field missions in the Eurasian countries. OSCE field missions undertake high-priority responsibilities in conflict prevention and post-conflict democratization and stabilization. Funds are also used to pay the salaries of American citizens seconded to the OSCE Secretariat and field missions, as well as the travel costs of Americans serving as election monitors for the OSCE’s Office of Democratic Institutions and Human Rights. A total of $10 million in FY 2007 FSA regional funding is being requested for these purposes. In addition, $2 million in FSA regional funding is being requested to support extra-budgetary contributions to the OSCE for high-priority projects to promote human rights, democratization, economic development, and environmental protection. C. Independent Agencies ($ in thousands) FY 2005 Actual FY 2006 Estimate FY 2007 Request Peace Corps 317,440 319,880 336,700 Inter-American Foundation (IAF) 17,856 19,305 19,268 African Development Foundation (ADF) 18,848 22,770 22,726 Millennium Challenge Corporation (MCC) 1,488,000 1,752,300 3,000,000 Total, Independent Agencies 1,842,144 2,114,255 3,378,694 The FY 2007 budget request provides $336.7 million for the Peace Corps, an increase of nearly $17 million over the estimated FY 2006 level.
By the end of FY 2007, there will be approximately 7,800 American Peace Corps Volunteers assisting host countries and local communities to improve education of students, encourage economic development, protect and restore the environment, and increase the agricultural capabilities of farming communities, expand access to basic health care for families, and address HIV/AIDS prevention and care. Through their services, American Peace Corps Volunteers make lasting contributions to the U.S. and the international community by representing American values and diversity, responding to humanitarian crises and natural disasters, and preparing America's work force with overseas experience. Inter-American Foundation (IAF) The FY 2007 request of $19.3 million will fund the Inter-American Foundation's (IAF) mandate to support programs that promote entrepreneurship, self-reliance, and democratic self-governance as a way to foster economic progress for the poor. A focus on innovation drives the IAF’s work in Latin America and the Caribbean, such as its pioneering efforts to work with migrant organizations to help channel some of the vast amounts of remittances that immigrants send home each year into development activities for their home communities. In FY 2007, the IAF will create Opportunity Zones, one of President Bush’s key proposals at the recent Summit of the Americas in Argentina. This program encourages a combination of business ownership, local investment and civic partnerships to bring people out of poverty in targeted areas. The IAF will continue to expand its innovative program involving a partnership with an expanding network of 54 Latin American corporations and corporate foundations. Participating corporate partners share criteria for funding and a results measurement system based on IAF's experience with grassroots development, and exceed IAF contributions by a ratio of 2:1 to support local development initiatives. In FY 2007, the IAF will again support the President's priorities in Latin America and the Caribbean to reduce poverty, strengthen local democratic practice, and stem the flow of illegal immigration. African Development Foundation (ADF) ADF’s request for $22.7 million in FY 2007 will allow the Foundation to provide African small enterprises with the essential capital, technology, technical assistance, and training they need to grow, generate new jobs in Africa’s poorest communities, and deliver significant increases in income to their employees. The funding will also help farming groups and small businesses access the global economy by providing them with resources to diversify their production, create value-added products, and market those products to regional and overseas consumers. ADF will leverage its annual appropriation by securing approximately $18 million in matching donations from African governments, other donor organizations, and the private sector. Millenium Challenge Corporation (MCC) The President’s budget requests $3 billion for the Millennium Challenge Corporation for FY 2007 to enable MCC to reduce poverty through economic growth and realize the vision of the President when he presented the concept of a new compact for global development in 2002. Two years after its founding, MCC is now working closely with 23 eligible countries in various stages of the compact development process, providing guidance and technical assistance, with the end goal of signing transformational compacts. In November 2005, the MCC Board selected six new countries eligible for MCC funding, on top of the 17 previously selected countries. In addition, MCC is working with 18 threshold countries, three of which (Burkina Faso, East Timor, and Tanzania) were also selected by the MCC Board as eligible countries for FY 2006. The Threshold Program was created to help countries who have not yet qualified for MCA Compact funding, but have demonstrated a significant commitment to improve their performance on the eligibility criteria for MCA Compact funding. MCC has built the organizational capacity, in terms of talented staff and policies and procedures, to help eligible nations move quickly through the compact development process. MCC has made significant improvements to better deploy funding effectively and responsibly, including a major reorganization in the first quarter of FY 2006. In its first two years, MCC has created a lean and vibrant organization to administer the Millennium Challenge Account. In this short period, MCC has hired 165 employees, and expects to increase staff by more than 60% in FY 2006 to meet its intended capacity of 300 employees. MCC has received a clean opinion on its most recent audit, and has worked closely with its Inspector General to review many of its procedures with a view to improving service delivery and management controls. By the end of FY 2005, MCC had approved five compacts amounting to $905 million. MCC expects to approve at least six additional compacts in FY 2006 for an additional commitment of up to $1.7 billion, twice the level committed in FY 2005. In FY 2007, MCC is expecting to sign up to 10 new compacts for commitments of over $3 billion. Disbursements will also begin to increase more rapidly in FY 2006 and even more so in FY 2007 as the initial tranch of signed compacts move beyond the initial stages of implementation. D. Department of State ($ in thousands) FY 2005 Actual FY 2006 Estimate FY 2007 Request International Narcotics Control and Law Enforcement 947,389 472,428 795,490 Andean Counterdrug Initiative - ACI 725,152 727,155 721,500 Migration and Refugee Assistance 884,240 783,090 832,900 U.S. Emergency Refugee and Migration Assistance Fund 29,760 29,700 55,000 Nonproliferation, Anti-terrorism, Demining, and Related Programs 422,184 406,000 449,430 Global HIV/AIDS Initiative 1,373,920 1,975,050 2,894,000 Conflict Response Fund - - 75,000 Democracy Fund - 94,050 - Total, Department of State 4,382,645 4,487,473 5,823,320 International Narcotics Control and Law Enforcement (INCLE) The FY 2007 request includes $795.49 million for country and global programs for International Narcotics and Law Enforcement Affairs activities. Key initiatives under this account include: Afghanistan ($297.39 million) – The request accelerates and expands three major programs: law enforcement, counternarcotics and justice sector reform. Law Enforcement: Funds will support maintenance and operation costs for our Regional Training Centers and police trainer-advisors to begin providing specialized and advanced courses for Afghan police that build upon the basic training program previously provided, including leadership and management training, advanced counternarcotics skills, field training, operational police skills, computer skills, literacy skills and other critical courses. In addition, funds will support continued Ministry of Interior reform efforts including payment of police salaries through a contribution to the United Nations Development Program Law and Order Trust Fund for Afghanistan (LOTFA). Counternarcotics: Funds will support a governor-led opium poppy elimination program to discourage farmers from planting poppy and to promote provincial-level eradication early enough to replant in legitimate crops. Funds will provide for a ground-based, manual eradication program operated from the national level to reinforce provincial poppy elimination/eradication efforts. Funds will also support drug interdiction programs, including aerial support for DEA-assisted raids, and provide for public awareness campaigns, and demand reduction programs. Justice Sector Reform: Funds will support four strategic objectives: development of institutional capacity of the permanent justice institutions, development of the operational capacity of criminal justice sector actors, development of the correctional system, and professionalization of justice sector personnel. Specific activities will include advisory support, basic and specialized criminal justice training, institutional capacity-building projects, and continued support for the bar association, licensing development, and legal aid centers. Funds will also be used to maintain a comprehensive corrections reform and support program including corrections training, infrastructure and equipment support, and systems management improvements such as a prisoner tracking system and database. The reintegration of women into the legal sector will remain a focus through FY 2007. Iraq ($254.6 million) - The Iraq Rule of Law program consists of eight components: (1) Human Rights within the Criminal Justice System ($15 million), (2) Criminal Justice Integration ($25 million), (3) Public Integrity Program ($18 million), (4) Foster Rule of Law Outreach Program ($50 million); (5) Initiate Provincial Prosecutor Development Program ($14 million); (6) Courthouse Infrastructure/Security ($93.6 million); (7) Corrections Program ($32 million); and (8) Administrative Oversight ($7 million). The program will develop and harmonize both an effective and efficient means for sustaining an integrated process of justice within civil law and based on human rights for the Government of Iraq. The intent is to strengthen human rights enforcement in the Iraqi criminal justice system, promote the integration of police, courts and prisons; continue development of public integrity codes of conduct and anti-corruption laws, develop legal assistance centers and increase public understanding of the justice system, initiate a public prosecutor development program; provide courthouse infrastructure and security enhancements; and provide corrections advisors to the Iraq criminal justice system. Africa ($21.5 million) - In Sudan, funds will support the Comprehensive Peace Agreement by improving the police, courts and correctional capacities in Southern Sudan through police advisors/mentors for the UN Mission in Sudan (UNMIS). Funds will also support technical assistance on the organizational structures of the police, courts and corrections, and provide equipment and infrastructure development. In Liberia, funds will provide technical assistance for the Liberian police in the areas of community policing and investigations involving trafficking in persons and domestic violence. Funds will also support programs in Nigeria, South Africa and throughout the region, providing training, equipment and technical assistance for police and judicial reform and modernization, law enforcement enhancement, and investigative and prosecutorial capabilities on financial crimes. Also, funds will support the Women’s Justice and Empowerment Initiative (WJEI), a $55 million 3-year project jointly funded by INCLE and ESF to promote women’s justice and empowerment in four African nations—Benin, Kenya, South Africa, and Zambia. This initiative will work to assist the existing efforts of these countries to combat sexual violence and abuse against women, and empower them in society. In FY 2007, $9.6 million is requested to continue to finance the criminal justice development aspect of the initiative, which began in FY 2006. Funds will be used to continue to provide training, technical assistance, and equipment needed to achieve the goals of strengthening: local police capacity to investigate reports of abuse and arrest; the court system capacity to prosecute offenders; and laws supporting women’s justice and empowerment. Near East ($1 million) – Funding will be directed toward continued efforts in assisting Morocco improve its border control security. Funds will provide equipment, technical assistance and training to help Morocco’s problems with illegal migration, human smuggling, narcotics production and trafficking Mexico ($39 million) – Mexico is critical both to U.S. homeland security and counternarcotics strategies. INCLE funding will be used for three major programs: Homeland/Border Security, Counternarcotics, and Institutional Development. Homeland/Border Security projects will include installation of additional non-intrusive inspection units; development of automated systems to better document, monitor and control cargo, vehicles, and pedestrians flowing across the border with the United States and at maritime ports; and construction of additional expedited border crossing lanes at key points to connect with parallel lanes on the U.S. side. Counternarcotics projects will include providing technical assistance and equipment to Mexican law enforcement agencies to enhance their ability to investigate organized crime, interdict drug and precursor chemical shipments, and conduct enforcement operations. Operational support will be directed to ongoing successful cooperative efforts to dismantle major trans-border drug trafficking groups and related threats. Attacking methamphetamine production facilities will be a top enforcement priority. Funding will partially upgrade the aging air fleet of the Office of the Attorney General and support the Mexican Air Force’s C-26 program, both of which will enhance interdiction capabilities. Institutional Development projects will help modernize law enforcement-related facilities, enhance training capacity, and provide systems management capabilities -- including national criminal and DNA databanks. USG funds will also support efforts to assess, strengthen, and professionalize Mexican local law enforcement along the border, where recent outbreaks of narcotrafficking violence threaten to spread into the U.S.
Guatemala ($2.2 million) - Funding will improve the ability of the Government of Guatemala to interrupt the flow of drugs that land in Guatemala en route to the United States. Other Western Hemisphere ($3.6 million) – This includes Bahamas, Jamaica, and the Caribbean and Central America Regional as well as Southern Cone Regional programs. The Caribbean accounts for an estimated 10-20% of the drug flow to the U.S. Funding will concentrate on the maintenance of the Caribbean capabilities in interdiction, law enforcement and administration of justice. Funding for Central American countries will target drug interdiction efforts and promote improved regional and cross-border cooperation aimed at stemming the flow of drugs. Global Programs ($132.3 million) – These programs are intended to counter transnational crime, key post 9/11 law enforcement challenges, and broader counternarcotics challenges. Specific components include: • Anti-Crime Programs ($14.5 million) – Funds will support programs to combat a broad range of crime challenges to our national security, including those with a strong connection to terrorism. These programs are focused in the following major areas: anticorruption; crimes involving information technology, including intellectual property rights enforcement; financial crimes and money laundering; alien smuggling; and border security. Funds will support our anticorruption efforts in international and regional organizations, including support for promoting implementation of the new United Nations Convention Against Corruption and related regional commitments in the Middle East and North Africa, Asia-Pacific, Western Hemisphere, Europe and Africa. Funds will support assistance projects identified pursuant to the G-8 Anticorruption Compacts, announced at the most recent G-8 Summits in Evian, Sea Island, and Gleneagles. Nicaragua, Georgia, Peru, and Nigeria have already entered into such Compacts, and, in cooperation with the G-8 and other donors, have developed technical action plans to increase transparency in procurement and public financial management. Funding in each country started in FY 2005 and this request represents the third and final year of support for this initiative. Projects initiated in FY 2005 include developing an Anticorruption Task Force in Nicaragua, developing a public financial management tracking system and training anticorruption investigators in Nigeria, developing a civil property registry and supporting public procurement reform in Georgia, and fostering anticorruption networks among Peruvian municipalities. In addition, we will continue efforts to stem financial crimes and money laundering by providing contributions to the 33-member Financial Action Task Force (FATF) and FATF-style regional bodies; supporting technical advisors, training, and development of Financial Intelligence Units in Central America, Caribbean and Pacific Islands; and development of Trade Transparency Units in select countries. Funds will also support the Human Smuggling and Trafficking Center by funding administrative costs of the Center. We will also help vulnerable countries to upgrade their border control systems, including providing technical assistance to help them improve travel document issuance systems and customs controls. Lastly, these funds will help stem the theft of intellectual property and promote cyber security by providing training, technical assistance and resident legal advisors to assist with capacity-building, including by modernizing laws and institutions. • Civilian Police Program (CIVPOL) ($2.0 million) – This request will be used to continue to develop the capacity of the U.S. to sustain basic capacity in three existing contracts to recruit and prepare well qualified individuals to train, equip, deploy, and serve as U.S. advisors and trainers in peacekeeping missions and complex security operations, and to improve planning and deployment capabilities (e.g., assessment teams, advance teams, and technical advisors) for quick and effective post-conflict response on criminal justice issues. The FY 2007 program will also fund a training coordinator and police advisor, and a position established at the U.S. Mission in New York responsible for working with the U.N. Department of Peacekeeping Operations. Funds also support program management and oversight efforts and responsibilities. • Demand Reduction ($1.9 million) – The request provides funding for international demand reduction programs that address Presidential priorities to augment prevention, intervention and recovery maintenance services. Funds will support the formation and enhancement of effective drug-free community coalition programs in key drug producing countries, provide treatment/prevention training focusing on intravenous drug users in Southeast Asia and Africa countries with high HIV/AIDS infection rates, and support Muslim-based anti-drug program/civil society organizations in the Middle East and South and Southeast Asia. The program will continue an international outreach program to educate international communities about U.S. policies, programs, success, etc., and support regional and bilateral drug awareness programs by providing technical assistance and advisors on creating media campaigns, treatment programs, and training for drug prevention providers. • International Law Enforcement Academy (ILEA) ($17 million) – The ILEA program continues to be a dynamic training program, providing relevant, timely, and quality training against the backdrop of diverse and often shifting regional economic, social and political environments. It anticipates and responds to constantly changing international crime-related challenges such as terrorism, corruption, financial fraud and money laundering, alien smuggling, trafficking in persons, and organized crime. The President’s 2003 National Terrorism Strategy Report urges us to "broaden the scope and strength of the ILEAs." These funds will allow us to continue to fully support existing ILEAs in Bangkok, Budapest, Gaborone, Roswell ,and the newest ILEA in San Salvador. • International Organizations ($5.4 million) – Funds will support counter-narcotics and anti-crime programs of the UN Office on Drugs and Crime (UNODC) and the counter-narcotics programs of the Inter-American Drug Abuse Control Commission (OAS/CICAD). Financial resources will be directed towards the following: in-country mentors to provide anti-money laundering and counter-terrorist finance assistance; legal advisors to ensure that countries implement the three international drug control conventions; precursor chemical control projects to track and prevent the diversion from legitimate commerce of the chemical precursors required for the manufacture of illicit drugs; on-the-ground assistance in implementing the provisions of the UN Convention Against Transnational Organized Crime and its supplementary protocols, as well as the universal counter-terrorism instruments and various OAS conventions; UNODC’s Independent Evaluation Unit, which enhances the efficiency and effectiveness of technical assistance delivery; OAS/CICAD’s Multilateral Evaluation Mechanism (MEM), along with technical assistance to countries to address the shortcomings identified by the MEM in their anti-drug programs/strategies; supply and demand reduction and legal development projects at the OAS; and implementation of the OAS’ Anti-Drug Strategy in the Americas. • Interregional Aviation Support ($65.5 million) – Funds will provide core services, including logistics, contractor support, spare parts, and Air Wing costs associated with operations centered at Patrick Air Force Base necessary to operate a fleet of 189 fixed-and rotary-wing aircraft, which support counternarcotics aviation programs in Colombia, Bolivia, and Peru, border security operations in Pakistan, and, as required, programs at other temporary deployment locations. • Program Development and Support ($19 million) – These funds will provide for the administrative expenses to carryout the International Narcotics and Law Enforcement programs. • Trafficking in Persons ($7 million) – Funds will target countries in Tiers 2 and 3 of the Trafficking in Persons Report, as well as other countries or regions where there are trafficking problems. Funds will support investigative and prosecutorial capacity building, strengthen law enforcement and civil society collaboration, fund victim protection initiatives, assist in developing anti-trafficking legislation, promote regional and cross-border partnerships, and support research to determine long-term and sustainable strategies. Andean Counterdrug Initiative (ACI) The FY 2007 $721.5 million request will be used to continue the multi-year counterdrug program (ACI) that aims to reduce the flow of drugs to the United States and prevent instability in the Andean region. Bolivia ($66 million) – The request will continue to support current Bolivian efforts to eradicate the illicit growth of coca, increase interdiction of essential chemicals and cocaine products, foster alternative economic development, continue current level of prosecutions of narcotics related cases, and improve the quality of investigations into alleged human rights violations. To achieve these goals, this request will continue to cover the costs of basic ground and air interdiction operations, eradication operations, and alternative development programs while fostering drug awareness and demand reduction within Bolivia. The drug control programs in Bolivia focus on: support and maintenance of a network of interdiction bases for ground and air operations, along with increased use of more flexible, mobile checkpoints and increased night operations; a national secure communications grid; and maintain current efforts to control coca production, and provide intelligence support for the growing number and increased complexity of operations and investigations. Funds will assist Bolivia by supporting institution building within the Bolivian forces dedicated to eradication, interdiction, and border security by providing training to police and prosecutors assigned to counterdrug operations as well as providing field support for the conduct of these operations. Alternative development funds will increase the competitiveness of licit rural enterprises thereby providing an alternative to illicit coca cultivation, foster more effective, transparent and responsive democratic institution, and improve basic public services and social conditions. Administration of Justice Program funds will provide training and technical assistance to help mitigate conflicts and enhance citizen’s access to the formal justice system. Colombia ($465 million) – The Colombia funds will continue to support the comprehensive campaign against drug trafficking and narcoterrorists. Funds will maintain support to the Colombian Army’s aviation program and drug units with training, logistics support, operating expenses, equipment, and upgrades to forward operating locations. These funds will similarly maintain support for the Colombian National Police in the areas of aviation, aerial eradication, and interdiction by providing equipment, logistical support, training, upgrades of security equipment, interoperable communications and information links, and basic administrative support. Alternative development programs will increase legal economic opportunities by promoting social and economic development by introducing new licit crops, supporting agribusiness and forestry activities and developing local and international markets for these new products. Funds will also support vulnerable groups, democracy, the rule of law, judicial reform, and drug awareness and demand reduction by providing training, equipment, education, technical assistance, and advisors in these areas. Brazil, Ecuador, Venezuela and Panama ($26.3 million) – The request will continue interdiction and eradication efforts in the key transshipment countries of Brazil, Ecuador, Venezuela and Panama. FY 2007 funds will focus on improving police and military operations by providing training and equipment and upgrading critical facilities. Funds will be used for training and equipment for law enforcement units to improve drug detection, seizure and mobile inspection capabilities and port and border point of entry security programs. In addition, training will enhance judicial and prosecutorial effectiveness and enhance money laundering and chemical investigation efforts. Critical Flight Safety Program ($65.7M) - The Department of State Air Wing has an immediate need for a Critical Flight Safety Program (CFSP) to upgrade its severely aged aircraft fleet to commercial standards in order to sustain the counter-narcotics and counter-terrorism missions. The declining condition of the fleet presents the mission and our aircraft with a crippling reality of increased costs for amplified maintenance man-hours and material requirements, and degraded performance capability. In many cases, Air Wing aircraft show evidence of severe structural failures that resulted in forced groundings. Many are ex |
