Wednesday, January 24, 2018 | ePaper

US aid policy to watch in 2018

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Adva Saldinger  :
While 2016 was a big year for United States development legislation, last year was markedly quieter, dominated instead by budget debates and efforts to ensure aid funding. While development dollars will once again top the agenda in Congress, there are several other pieces of key legislation.
Those bills could help shape U.S. policy on everything from multilateral aid, to development finance, food security, and internet access.
It won't however necessarily be an easy year to get things done as Congress contends with a busy legislative agenda ahead of midterm elections.
"We have to be opportunistic, have to keep pushing to make sure that the concerns of the vulnerable around the world are not swept away in these big political battles," said Bill O'Keefe, Catholic Relief Services' vice president for government relations and advocacy. "The whole environment is too uncertain to leave important things undone ... If there's an opportunity to move legislation we need to move it."
It's a significant year legislatively also because there will be new leadership in both the Senate Foreign Relations Committee and the House Foreign Affairs Committee next year as Sen. Corker and Rep. Ed Royce have announced they are not running for re-election. Royce would have had to step down from the post either way, as he's reached the term limits for the chairmanship.
Here's a look at some of the key legislative issues for the year ahead.
The budget
With the U.S. government operating under a continuing resolution because no budget bill passed for the 2018 fiscal year, there will be debates not only on how foreign aid will be funded this year, but how it will be funded next year as well. As the budget process plays out, advocates anticipate continued tension between what the Trump administration has or will request and what appropriators in Congress will put forward.
The current budget continuing resolution expires Jan. 19, and some decision will have to be made by then or risk a government shutdown. While there are a number of options, it seems there may be another continuing resolution, pushing the budget discussion further down the road. That would set up a situation in which both the 2018 and 2019 fiscal year budgets were being discussed simultaneously, and could lead to a funding bill that would address both years.
The Trump administration is expected to release its fiscal year 2019 budget proposal in February, and most of the policy and budget experts Devex has spoken to predict that the proposal will include cuts to the foreign aid budget that either match or surpass the roughly 32 percent cut proposed for 2018. Most of those experts also believe Congress will once again push back against those numbers and reject such deep cuts to the foreign aid budget.
Last month, Sen. Lindsey Graham, a Republican from South Carolina, who is the chairman of the Senate Appropriations subcommittee on state, foreign operations and related programs, predicted that this budget cycle may even bring more funding for development programs.
"We're about to go into a new budget cycle. I'll make one prediction: When this is all over, we're gonna have more money for foreign assistance, not less," Graham said at the U.S. Global Leadership Coalition tribute dinner.
Humanitarian organizations are keeping an especially close eye on what the budget will hold for the growing number of protracted humanitarian crises. In 2017, Congress passed a bill providing nearly $1 billion in aid to fight famine, which many took as a positive side of the legislature's commitment to humanitarian aid.
"The needs are far outstripping the resources available for the upcoming year so we are really hopeful that Congress will respond to those needs," O'Keefe said. "But who knows, the budget deal could go the other way and there's no excess resources given the need at this point in time, so there is lots to be concerned about there."
The U.S Agency for International Development and the State Department, and the agencies' leadership weren't a part of the fiscal year 2018 budget, and while they likely won't be given much money to work with, the budget may provide insights into what they prioritize.
The administration's budget may provide a glimpse into the restructuring efforts at USAID and the State Department, though more significant details, particularly about structural reforms will probably not be available until later in the year. Congress, which has already called for more openness and involvement in the restructuring process will be monitoring the process, and it is worth watching what, if any actions they might take to ensure that their desires are addressed and both USAID and the State department have the staff they need.
The legislation, which lawmakers hope to introduce by the end of this month and ahead of the president's fiscal year 2019 budget proposal, will likely expand the mandate of OPIC. The new development finance corporation would likely have equity authority, grant authority, and would potentially have higher caps on the amount of money it could lend, or be allowed to reinvest some of the money it makes back into itself.
The core issues being discussed are around consolidation and what agencies or agency functions might become part of the new corporation, what new authorities the agency would have, and how it will be connected to USAID.
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The Trump administration has signaled support for a new development finance corporation.
Tom Hart, the North American executive director at ONE Campaign called the legislation "long overdue," and in many ways it is. OPIC has not had a long-term authorization in about a decade and previous CEOs have told Devex it is poised for growth but constrained by its mandate.
"The U.S. is playing catch up with the rest of the world. This is a good moment to find a way to leverage private sector finance," Hart said.
Multilateral Aid Review Act
Modeled after a process that the United Kingdom already follows, the Multilateral Aid Review Act would create a process and set of criteria for evaluating U.S. multilateral investments.
Introduced in October by Sen. Bob Corker, a Republican from Tennessee, and Sen. Chris Coons, a democrat from Delaware, the bill would create an interagency task force that would conduct regular evaluations of how well multilateral institutions "carry out their missions and how they serve American interests and taxpayers," according to a press release from the Senate Foreign Relations Committee.
"We want to be investing in the programs that are most effective, doubling down on those making a big difference," Hart said, adding that the criteria used to judge investments and the details of the bill are very important.
Food security
The Global Food Security Act of 2016 passed, but was only a one-year authorization, so one of the issues Congress will work on is a reauthorization of the Global Food Security Act. This time around, advocates and members of Congress are trying to pass a five-year authorization of the legislation that requires the president to develop and implement a global food security strategy.
"Food security, malnutrition and stunting are all issues that are long term problems, requiring long term solutions," O'Keefe said, which is why the goal is for the bill to provide a 5 year reauthorization.
The Farm Bill
While much of the Farm Bill is focused on domestic interests, it is also the legislation that dictates U.S. food aid policy. It is up for renewal this year, and as usual some of the contentious issues around how food aid is delivered are likely to resurface.
Aid advocates have long been pushing to reduce the cargo preference, which dictates that at least 50 percent of food aid be shipped on privately owned U.S.-flagged ships. The requirement often results in higher shipping costs and delays in critical food aid reaching those in need. Sen. Corker, who announced last year he will not run for re-election will be leading some of the efforts on how to modernize food assistance, Hart said.
A more flexible food aid policy that would eliminate or reduce cargo preference and allow the U.S. government to buy more food aid in the region or provide cash aid in times of famine, are all being discussed.
PEPFAR reauthorization
The current authorization for the U.S. President's Emergency Plan for Aids Relief expires at the end of September, and so Congress will have to act and pass a reauthorization to keep the program, which has generally enjoyed bipartisan support, up and running.
PEPFAR has been reauthorized three times since it was established, but it it is as yet unclear whether it will be a fourth time, and the details of how that would happen are up for debate. The legislation would also authorize the President's Malaria Initiative, U.S. support to the Global Fund to Fight AIDS, Tuberculosis and Malaria, tuberculosis funding, and potentially other health-related programs or support.
Combatting foreign corruption act
Sen. Ben Cardin, a Democrat from Maryland, and the ranking member of the Senate Foreign Relations Committee, has introduced the Combating Global Corruption Act that would require the state department to publish annual rankings of countries based on how they meet a set of corruption criteria.
The standards include having and enforcing laws that prohibit corruption, punishing corruption at different levels in appropriate ways to deter corruption, and making sustained anticorruption efforts. Those rankings would then impact how the most poorly ranked countries would receive foreign aid, requiring risk assessments, anticorruption clauses and other safeguards to protect against U.S. funds being misappropriated.
The bill was introduced in the Senate last year, but has yet to make progress through the system.
Digital GAP Act
The Digital Global Access Policy Act of 2017 is a bill that's aimed at guiding U.S. policy on helping developing countries improve internet access.
The bill passed the House last year but did not pass the Senate. Among the bills suggestions is one that USAID should integrate efforts to expand internet access and create guidelines to protect the personal information of individuals served by development and humanitarian programs.
AGOA and MCA Modernization Act
The African Growth and Opportunity Act and Millennium Challenge Act Modernization Act was introduced last year but didn't make much progress. The bill, which urges the State Department to provide training, facilitation, and capacity building to improve trade and help African countries access AGOA benefits.
The bill would also require the president to create a website to collect and share information about AGOA. It would also address several key issues for the Millennium Challenge Corporation and would allow it to do multiple compacts in a country, create new criteria for low-income or lower-income countries.
(As a Devex Impact associate editor, Adva leads coverage of the intersection of business and international development).

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