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Diplomacy in Action

Strategic Goal 4: Promoting Economic Growth and Prosperity


Bureau of Resource Management
Report
January 15, 2009

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Strengthen world economic growth and protect the environment, while expanding opportunities for U.S. businesses and ensuring economic and energy security for the nation.

I. Public Benefit

Photo showing wind turbines in Lezignan Corbieres, France.

Wind turbines in Lezignan Corbieres, France. AP Photo/Remy Gabalda

The U.S. Government goal is to achieve rapid, sustained, and broad-based economic growth for the United States, its trading partners, and developing countries. Global economic growth is a key U.S. foreign policy priority and is essential for the reduction and eventual elimination of extreme poverty, poor health, and inadequate education among developing countries. Countries that offer their citizens hope for increasing prosperity are less prone to extremism, more inclined to favor democracy, more willing to settle disputes peacefully, and more likely to be constructive partners with the United States in the international community. The United States derives enormous benefits from a stable, resilient, and growing world economy and plays a leadership role to promote economic growth and prosperity.

II. Summary of Performance

FY 2008 Results Achieved for Strategic Goal 4
RatingNumber of IndicatorsPercentage of Indicators
Above target 7 54%
On target 2 15%
Improved over prior year, but target not met 1  8%
Below target 3 23%
Data not yet available 0  0%
Total13100%

Key Selected Achievements

  • The Department established Open Skies Agreements with Australia, Croatia, and Kenya to permit more liberal access for each countries’ airline to provide passenger and cargo service.
  • The Department contributed to reducing the median number of days it takes to start a business in African countries to 37 days, 2 days less than last year.

III. Performance Analysis and Resources Invested

FY 2008 Budget Authority for Strategic Goal 4
(Dollars in Millions)
Strategic PrioritiesBudget
Private Markets and Competitiveness$  493
Trade and Investment$  220
Financial Sector$  205
Infrastructure$  569
Energy Security$  202
Agriculture$  304
Macroeconomic Foundation for Growth$  322
Economic Opportunity$  509
Environment$  217
Total$3,040

A total of nine strategic priorities are included under Strategic Goal 4. The following are a few illustrative performance indicators. The complete set of 13 indicators can be found in the Department’s Annual Performance Report at http://www.state.gov/s/d/rm/rls/perfrpt/2008apr/ on page 84.

1. TRADE AND INVESTMENT: Promote increased trade and investment worldwide, on both multilateral and bilateral levels, through market-opening international agreements and the further integration of developing countries into the international trading system.

The U.S. Government promotes increased trade and investment, a powerful engine for growth, and has negotiated a number of bilateral free trade agreements to open new markets for American goods and services. At the beginning of the Bush Administration, the U.S. had free trade agreements in force with three countries, whereas now the U.S. Government has nine free trade agreements in force with 14 countries. President Bush signed a free trade agreement with Peru on December 14, 2007, and free trade agreements with Colombia, Panama, and South Korea are pending Congressional approval.

Analysis: U.S. activities include the negotiation of bilateral and multilateral treaties that promote free trade and transparent investment regimes, assistance in the development of legal and regulatory systems in developing countries to all those countries to qualify and take advantage of international agreements, and assistance to private sector organizations and businesses to improve their abilities to meet international standards.

Performance Indicator Target and Results Summary for 2006-2009
Performance Indicator2006
Results
2007
Results
2008
Target
2008
Results
2008
Rating
2009
Target
Number of Company-Specific Cases for Which Advocacy Services Were Provided349335300351Blue: above target.
Above target
350
Impact(s): Strengthens both U.S. and foreign economies by the direct support provided by the government to U.S. businesses in exporting goods and services as well as in resolving commercial disputes and managing overseas investments.
Reasons for Exceeding Target: Target was inadvertently established too low. Result is consistent with prior year result.
Data Source, Verification, and Validation: The Bureau of Economic, Energy and Business Affairs advocacy database; Department of Commerce advocacy database; reporting cables from posts; feedback from companies; report of quarterly success stories to the Deputy Secretary of State and the Under Secretary for Economic and Agricultural Affairs. Performance data are validated and verified using Data Quality Assessments and must meet five data quality standards of validity, integrity, precision, reliability, and timeliness. Data quality assessments revealed no significant data limitations.

2. ECONOMIC OPPORTUNITY: Support efforts to help people gain access to financial services, build inclusive financial markets, improve the policy environment for micro and small enterprises, strengthen microfinance institutional productivity, and improve economic law and property rights.

U.S. programs are geared to providing assistance to the poorest segments of society, including female-led households, allowing them to participate in the broader economy. These efforts include legal and regulatory reform of the financial sector, direct and indirect creation of micro-finance institutions, and legal and regulatory reform geared at small and medium business development.

Analysis: Microfinance institutions (MFI) help the poor to obtain start-up capital to open micro or small-sized businesses, expanding their choices and reducing the risks they face.

Performance Indicator Target and Results Summary for 2006-2009
Performance Indicator2006
Results
2007
Results
2008
Target
2008
Results
2008
Rating
2009
Target
Percent of U.S. Assisted Microfinance Institutions That Have Reached Operational Sustainability Per Year71%70%70%74%Blue: above target.
Above target
70%
Impact(s): Providing the poorest elements of society the opportunity to access the financial sector, in terms of loans, savings and ownership has consistently resulted in an expansion of economic activity and the generation of growth. However, for the growth to be sustainable it is essential that the institutions themselves be sustainablly and transparently managed.
Reasons for Exceeding Target: Measures of cost-effectiveness and sustainability for any given project are derived from the specific objectives to be achieved by the project, the context in which it operates, and the duration of support. A significant number achieved sustainability earlier than expected.
Data Source, Verification, and Validation: Microenterprise Results Reporting (MRR) Annual Report to Congress, FY 2007 and earlier editions. The indicator is the number of MFIs reporting either operational or financial sustainability, divided by the total number of U.S. Government-supported MFIs, expressed in percent. Performance data are validated and verified using Data Quality Assessments and must meet five data quality standards of validity, integrity, precision, reliability, and timeliness. Data quality assessments revealed no significant data limitations.

3. ENVIRONMENT: Promote partnerships for economic development that reduce greenhouse gas emissions, improve air quality, and create other co-benefits by using and developing markets to improve energy efficiency, enhance conservation and biodiversity, and expand low-carbon energy sources.

Analysis: Environmental issues such as climate change, protection of natural resources and forests, and trans-boundary pollution continue to play critical roles in our diplomatic and development agendas. U.S. efforts in Asia significantly exceeded targets for bringing increasing amounts of land under improved management that targets biodiversity. These results were primarily due to greater than expected participation of timber concessions in response to an improved enabling environment and supportive international policy changes. The indicator below assesses the impact of U.S. natural resource and biodiversity interventions in 21 countries receiving U.S. Government assistance.

Performance Indicator Target and Results Summary for 2006-2009
Performance Indicator2006
Results
2007
Results
2008
Target
2008
Results
2008
Rating
2009
Target
Number of Hectares Under Improved Natural Resource or Biodiversity Management as a Result of U.S. Assistance Per YearIndicator established in 2007121.6 million hectares113 million hectares126 million hectaresBlue: above target.
Above target
108 million hectares
Impact(s): Ecosystems are becoming impoverished at an alarming rate worldwide, threatening to undermine development by reducing soil productivity, diminishing resilience to climate change, and driving species to extinction. A productive and healthy environment is the foundation of economic growth, especially in developing countries where people’s livelihoods are often dependent on rangelands, forests, fisheries and wildlife.
Reasons for Exceeding Target: Multiple reporting locations significantly exceeded their FY 2008 targets. Reasons varied from overly conservative targets to improved enabling environments and increased levels of concern for habitat protection.
Data Source, Verification, and Validation: 2008 Performance Reports from approximately 40 countries as reported in the Foreign Assistance and Coordination System – FACTS. Performance data are validated and verified using Data Quality Assessments and must meet five data quality standards of validity, integrity, precision, reliability, and timeliness. Data quality assessments revealed no significant data limitations.

For a complete discussion of the following strategic priorities including performance measures, please refer to the APR.

4. AGRICULTURE: Support increased productivity and growth in the international agriculture sector by promoting expanded agricultural trade and market systems, broadening the application of scientific and technical advances – including biotechnology, and encouraging sustainable natural resource management.

5. PRIVATE MARKETS AND COMPETITIVENESS: Support efforts by other countries to improve institutions, laws, and policies that foster private sector-led economic growth and competitiveness.

6. FINANCIAL SECTOR: Improve financial sector governance as well as the quality of and access to financial services by improving corporate governance, accounting, financial transparency, and by combating financial crimes and corruption.

7. INFRASTRUCTURE: Promote sustainable improvements in foreign infrastructure by encouraging public-private partnerships, strengthening capacities for oversight and management, and expanding markets for tradable infrastructure services.

8. ENERGY SECURITY: Enhance U.S. and global energy security by: promoting open and transparent, integrated, and diversified energy markets; encouraging appropriate energy sector investments; and developing and sharing clean and efficient energy technologies.

9. MACROECONOMIC FOUNDATION FOR GROWTH: Promote institutions, laws, and policies that support private sector efforts to build people’s capacity to take advantage of expanding economic freedom – including the promotion of effective public-private partnerships.

 


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