Foreign Assistance

The Agency for International Development (AID) is at a critical juncture in its 30-year history. Even as AID is undertaking new, ambitious initiatives, like providing assistance to the former Soviet Union, it has come under increasing scrutiny because of concerns that its management of the current foreign aid program has been poor. Moreover, the Soviet threat that once was the glue for political and popular support of foreign aid has disappeared, and what resources AID will have to draw on during this era of tight federal budgets is unclear. This broad-based evaluation of AID's management examines whether the agency has (1) effectively coped with the rapid expansion of its responsibilities, (2) established effective management controls over its decentralized operations, and (3) adequately managed its human resources.

GAO found that: (1) the AID management approach and organizational capacity have not kept up with the increasingly diffuse scope of the foreign assistance program and the expanding number of countries in which AID operates; (2) AID has expanded its operations; (3) some small AID programs have had such a negligible effect on a country's development that the effect may not justify AID in-country presence; (4) studies have shown that AID has not effectively managed, and has not been held accountable for achieving results from, a diffuse foreign assistance program; (5) opening new overseas offices has further burdened the AID operating expense budget; (6) the fragmentation of the foreign assistance program is largely due to a lack of consensus among the many groups that are concerned with the AID mission or have a stake in its services and resources; (7) congressional involvement has hampered AID ability to use foreign aid as leverage to secure needed economic reforms and target assistance to the most pressing development needs of recipient countries; (8) AID has not been able to fully implement the strategic management concepts that would enable it to better focus and concentrate its limited resources; (9) AID maintains that its decentralized organizational structure and management approach are appropriate given the widely varying development and assistance needs of the numerous countries in which it operates; and (10) lack of management controls has impaired AID program effectiveness.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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