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Remarks by Henrietta H. Fore
Administrator, USAID and Director of U.S. Foreign Assistance

Advisory Committee on Voluntary Foreign Aid
Ballroom, National Press Club
Washington, DC
Thursday, February 28, 2008

[Remarks As Prepared]

I would like to welcome six new members to the ACVFA, five of whom are with us today: Doug Bereuter of the Asia Foundation; Dr. Helene Gayle with CARE; Corey Griffin with Microsoft; Dr. Robert Litan with the Kauffman Foundation; Johanna Schneider with the Business Roundtable; and Deborah Wince-Smith with the Council on Competitiveness, (Deborah could not be with us today). I am honored to have their experience and expertise informing the work of the Committee under the leadership of John Sullivan, the Chair and Carol Adelman, the Vice Chair.

Since the ACVFA's last public meeting in October, I have received periodic updates on the Committee working groups. In January, I met with representatives from the ACVFA to discuss the final recommendations for humanitarian assistance and investing in people. I would like to take this opportunity to thank the group leaders, Nancy Lindborg and Steve Moseley, as well as their fellow Members for their hard work and dedication.

USAID's senior leadership is engaging with the working groups around their recommendations. I would like to take a few minutes to outline each of their current projects:

• First, we are cooperating with the working groups on Economic Growth and Governing Justly and Democratically on ways to strengthen cross-training of USAID's economic growth and democracy officers.
• Second, USAID's Office of Acquisition and Assistance is cooperating with the Implementation Mechanisms working group to improve our procurement regulations.
• Third, the Humanitarian Affairs working group, in consultation with the Office of Foreign Disaster Assistance, is creating a transition plan for relief to reconstruction efforts.
• And fourth, the working group on Investing in People, consulting with USAID's Education Office, is preparing criteria for the next generation of USAID education officers.

I encourage the ACVFA to consider establishing a working group that would focus on ways to strengthen the American consensus for foreign assistance. I see this in line with the purpose of the Global Development Commons - creating greater awareness of what is taking place in development and humanitarian assistance with the multitude of actors represented here today and across our nation and in the countries in which we serve.

Since our meeting last October, I have met with a wide range of government officials at the OECD and have gained strong endorsements for the concept of the Commons. We are exploring ways to advance the Commons with other donor agencies. USAID sponsored a presentation on the Commons at the World Economic Forum in Davos, Switzerland, last month. There, we received much encouragement from private sector technology companies whose executives want to help. Universities, foundations and NGOs also are eager to become part of the Commons and are offering valuable suggestions.

Within the Agency, I have established, staffed, and funded a Secretariat within the Office of Development Partners to focus exclusively on advancing the Commons. This Secretariat is working closely with our Chief Information Officer to break down "information silos" to create a "Smart Portal" to access all of USAID's websites. Your suggestions are most welcome at this stage, and I believe they will have a significant impact.

ACVFA has had a very substantive advisory role in preparing USAID's new Strategy for Economic Growth, soon to be released. Let me give you a preview of the strategy:

First, it is important to recognize that much has been accomplished. From 1950 to 2004, the portion of the world's population living in extreme poverty fell from 55 percent to 21 percent. This record gives us reason for genuine optimism as we seek to promote further economic growth and poverty reduction.

Research shows a strong and encouraging correlation between economic growth in the developing world and a rise in tolerance, peaceful resolution of social and economic conflicts, and support for democracy. Good democratic governance in turn enhances prospects for further economic expansion. Our goals in these key areas are reinforcing. Economic growth, in tandem with the promotion of democracy, is an important key in achieving America's transformational development goals.

In this regard, the Strategy has important operational implications for us all. I want to focus on a few:

• We will put priority on improving the business climate for enterprises of all sizes and in all sectors. As Dr. Litan and his colleagues point out in "Good Capitalism, Bad Capitalism" (which I highly recommend to everyone), the first and foremost requirement for a successful entrepreneurial economy is that "… it must be relatively easy to form a business, without expensive and time-consuming red tape."
• I am proud that USAID is the leading donor in support of these kinds of critical economic reforms. With the exception of China and Saudi Arabia, we directly supported two-thirds of the reforms implemented by the world's top ten reformers last year, as reported in the World Bank's latest "Doing Business" report. We will continue support for such reforms.
• Work in agriculture and other specific sectors will continue to be important where those sectors are significant elements of local economies and/or particular pockets of poverty. This sector-specific work complements and reinforces our business climate reform efforts.
• The Strategy promotes a pro-growth and a pro-poor agenda simultaneously, because it is the smaller businesses and marginalized people who are most often excluded due to poor governance systems. Under an improved business climate, women are often the leading beneficiaries.
• This strategy is a credit to many of you who have championed new approaches for years, in agriculture and more broadly, by strengthening the voice of the private sector through business chambers and associations.

Our new Economic Growth Strategy will provide a platform for all of our stakeholders to spread the word about what works - and what efforts we should continue to pursue as we strive to lift more of the world's citizens from the extremes of poverty.

As we know, people have a better chance of rising out of poverty when they can access the legal systems that help them to build and retain assets. To this end, I would like to note USAID's active leadership and participation in the United Nations Commission on Legal Empowerment of the Poor. The Commission, co-chaired by Madeleine Albright and Hernando de Soto, was established in 2005 in an effort to catalyze the development of legal and economic institutions that are inclusive of the poor and give voice to their needs. The Commission has provided guidance on increasing access to a functioning property rights system, increasing access to justice, facilitating the formalization of business, and assuring labor rights.

We also recognize that the common interests of democratic governance and economic growth are advanced when we take effective measures against corruption. USAID has been on the cutting edge of anticorruption work in the development community. We have included anticorruption in our development framework since the mid-1990s. Our Anticorruption Strategy, released at this forum in 2005, provides an expanded framework that examines both the economic and political foundations of corruption and highlights the importance of comprehensive efforts that do not simply target the symptoms of corruption, but address the root causes-unaccountable political leaders, weak checks and balances and lack of access to information.

Before concluding, I would like to highlight the President's FY 2009 budget for development. I hope you will share my excitement about the budget proposal because it requests resources to elevate USAID to a strong position for the 21st century.

ACVFA always devotes careful attention to USAID staffing. I am pleased to tell you that the President's budget provides for a major increase in foreign service personnel - what we call the Development Leadership Initiative. We are urging Congress to approve this budget proposal so that we can increase our numbers of foreign service officers by 300 per year for the next three years. This would be a net increase over and above replacing officers lost to attrition.

Our budget request for FY 2009 will cover salaries and other operational expenses associated with the Development Leadership Initiative. These include Foreign Service pay modernization and increased physical security overseas. We need full funding for the Development Leadership Initiative if we are to meet America's global responsibilities.

I know that I can count on ACVFA members - and the members of the public here today - to continue telling the good news about the successes in global development and the realistic hopes we share to continue our progress against poverty, hunger, disease, and oppression.

Thank you very much.

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