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| >> Return to CBJ F Y 2002 Home Page >> Regional Overview | ||||
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(text taken from the FY 2003 Congressional Budget Justification) THE DEVELOPMENT CHALLENGEAside from its humanitarian value, foreign assistance is one of the United States' most effective foreign policy tools for promoting regional stability. By encouraging a prosperous, healthy, educated population that is able to participate in democratic processes, USAID reduces the risk of terrorism, regional conflict, refugee flows, and the spread of infectious diseases that all threaten the interests of the United States. Nowhere are these threats more apparent than in the Asia and Near East (ANE) region and its three subregions: South Asia, the Middle East, and East Asia. Through its foreign assistance programs, the United States also has the opportunity to help Asia and the Near East respond to globalization and explore the benefits of regional cooperation. 1. South AsiaThe events of September 11th highlighted the strategic importance of this subregion to the United States, and the importance of improving economic and social conditions in South Asia to U.S. national security. South Asia faces some of the most daunting development problems in the world. The region is home to one-fifth of the world's population and 40% of the world's poor. More than half of the region's children under the age of five are malnourished.1 South Asia has the world's highest adult illiteracy rates, second highest fertility levels, a rapidly growing HIV/AIDS epidemic, widespread prevalence of infectious diseases, low socioeconomic status for women and girls, increasing urbanization and pollution, and staggering infant and child mortality. Each of these phenomena also threatens political stability, as millions of poor and dispossessed are susceptible to radical and sometimes anti-American ideologies.
Economic Growth, Agriculture, and TradePoverty is the most glaring barrier to human development in South Asia. Half a billion people live on less than a dollar a day. Agriculture is crucial to South Asia's economy: 25% of GDP comes from the agriculture sector (compared to the worldwide average of four to five percent), and 58% of workers are in agriculture. Yet, the subregion is a net importer of food. Major constraints on the sector include low productivity and poor management of scarce water resources. Finally, lack of access to education or poor-quality education for a large sector of South Asian society inhibits poverty reduction and economic growth. Thirty-five percent of men and 59% of women in South Asia cannot read. USAID work in this pillar focuses on improving economic growth and education to reduce poverty. USAID is committing more resources to improve performance in agriculture and assist South Asia's transformation from a subsistence-based agricultural system to one of greater income-generation and food security. Because of the importance of education in improving productivity and earning potential, as well as the links between literacy and improved health and governance, USAID will expand current basic education programming throughout the subregion. Global HealthSouth Asia's incredibly high child mortality rates exemplify overall poor health conditions. Twenty-two percent of children in Afghanistan and 12% of children in Pakistan do not live past the age of five. Tuberculosis, malaria, cholera, and dengue fever are rampant, and HIV/AIDS infections are increasing faster than in any other region. USAID's health interventions in South Asia concentrate on basic health interventions and programs that combat the spread of infectious disease. USAID support for basic health will focus on establishing essential services at the community level, including heavy emphasis on maternal and child health programs. HIV/AIDS interventions will remain focused on preventing the spread of the epidemic from groups who engage in high-risk behaviors, i.e., drug use and unprotected sex, to the general population. In India, USAID will continue to concentrate on two of the states with the highest incidence of HIV/AIDS: Maharashtra and Tamil Nadu. Democracy, Conflict, and Humanitarian AssistancePoor governance in South Asia not only foments unrest and conflict, it also undermines progress in other development sectors. South Asia's numerous intrastate and cross-border conflicts, history of martial law, and the threat of failed states as havens for terrorism all underscore the importance of strong democratic institutions, robust political debate, and active citizens. USAID programs in this pillar support the American democratic values of good governance and active civil participation. USAID also stresses cooperation in the subregion around issues such as human trafficking and energy. It is in the United States' national interests to help solve pressing development problems while forging improved relationships between sometimes-hostile neighbors. 2. Middle East and North AfricaThe Middle East and North Africa's vast oil resources and potential for conflict make the subregion pivotal to U.S. strategic interests. The subregion controls 70% of the world's known oil reserves. At the same time, the Middle East has the most meager freshwater resources in the world, and increasing competition for water will exacerbate an already volatile political climate. By addressing development problems, such as stagnant economies, high unemployment and population growth rates, lack of participatory government, poor education and health conditions, and competition over scarce natural resources, USAID assistance advances the U.S. goals of creating the necessary conditions for peace and preserving American access to petroleum resources in the Middle East. Economic Growth, Agriculture, and Trade
While some countries in the Middle East have made progress in reforming their economies, more needs to be done to integrate the subregion into the global economy and raise levels of investment. Increased investment and economic growth will in turn help provide jobs to the subregion's enormous population of young people: in Yemen and Egypt, 48% and 37% of their respective populations are under the age of 15, and unemployment rates in most Middle Eastern states exceed 15%. Increases in already high rates of unemployment may further destabilize the region and exacerbate the conditions that gave rise to the September 11th attacks. USAID projects will focus more heavily on legal and regulatory reform programs that will foster an economic environment in which competition and investment flourish. Besides enabling stronger economic growth, USAID will develop a more productive and employable workforce through education programs targeted especially at those entering the workforce. Without renewed focus on education, Middle Eastern countries will either be left behind or forced to import skilled labor. Global HealthThe increasing population of the region seriously impedes development and places further demands on already scarce resources, such as water and jobs. Although some progress has been made in reducing the rate of population growth in the last decade, the Middle East still tends to have very high rates of total fertility. For example, the average woman in Gaza and Yemen has more than six children. 2 Through projects such as community health centers, USAID promotes healthier children and more self-sufficient women who can take advantage of family planning. Healthy mothers and children provide the starting point for addressing the root causes of poverty: poor education, high unemployment, and unsustainable resource use. Family planning empowers women and encourages smaller, healthier families with better opportunities for education and living productive lives. Democracy, Conflict, and Humanitarian AssistanceThe looming water crisis is the Middle East's most severe environmental problem and requires continuous resource negotiations among Arab and Israeli users, as well as Egyptians and sub-Saharan Africa users of Nile-basin water. The subregion has the lowest per capita availability of freshwater in the world-and these resources are declining. Furthermore, water quality in the region is deteriorating due to over-extraction, salinity increase from over-irrigation, and raw or inadequately treated wastewater. Both deteriorating quality and decline in total available resources will increase the likelihood of conflict among competing water users. USAID efforts focus on mitigating the chances that water shortages will spark or intensify regional conflict in the Middle East. By focusing on water management both within and among states, USAID can promote peace in the subregion and address an important environmental need at the same time. Indeed, water management may be the most effective and direct means by which USAID can support the U.S. interest in a more peaceful Middle East. 3. East Asia
East Asia is struggling to emerge from a legacy of financial and political crises. Some countries are in a state of economic and political transition, intrastate conflict threatens fragile democracies in several East Asian nations, and authoritarian regimes persist. Levels of development vary from agrarian Mongolia to post-industrial Japan, and effects of the Asian financial crisis of the late 1990s linger across the region. Cambodia has the highest rate of HIV infection in Asia. Due to the region's geographic location amid major shipping routes, the existence of important U.S. allies, and the emergence of China as a military and economic power, stability in East Asia is vital to U.S. strategic interests. Last but not least, combating terrorist networks that operate in East Asia and addressing the root causes of terrorism are top U.S. priorities. Economic Growth, Agriculture, and TradeWeak economic governance and pervasive corruption contributed to the expansion of financial and currency crises into the full Asian economic crisis; the absence of sound social policies and a social "safety net" exacerbated its impact on the region's poor and marginalized. Although the "Asian model of development" has been credited with leading to exceptional growth in East Asia, it has yet to put into place systems that mitigate or reduce the impacts of economic downturns, i.e., strong economic governance, transparent financial systems, employment policies, insurance programs, and other safety net mechanisms. Although much of East Asia is richly endowed with natural resources, mismanagement of these resources is an obstacle to economic growth and improved public health. USAID is helping East Asian countries increase competition, transparency, and accountability in capital markets and other financial sector institutions. Its programs work to liberalize international trade, increase the degree of competition within domestic economies, eliminate restraints on foreign and domestic investment, and privatize infrastructure. USAID programs in East Asia also encourage sound natural resources management, energy sector reform, biodiversity conservation, and clean urban and industrial development. Global Health
The Asian Development Bank estimates that the share of HIV/AIDS-related illnesses in the sub-region will triple in the next 20 years, unless preventive measures are undertaken. 3 In East Asia, where risk factors are high and reports of HIV/AIDS in China and Burma are causing particular concern, the virus could erode development gains and destabilize a region of immense strategic and economic importance to the United States. At present, excepting Cambodia, Burma, and localized epidemics in some countries, seroprevalence rates are still relatively low in East Asia. This provides a unique opportunity for USAID to prevent the epidemic from reaching catastrophic proportions. USAID has identified HIV and related infectious diseases such as tuberculosis as a grave threat to health in East Asia, and employs both cross-border and national programs to combat their spread. Democracy, Conflict, and Humanitarian AssistanceThe Asian Development Bank in Manila estimates that as much as one-third of all public investment in many Asian-Pacific nations is being squandered on graft. 4 The development of market economies, new constituencies for reform within civil society, and stronger rule of law will improve governance standards in East Asia, especially at the local level. USAID programs will support strong civil society organizations that promote responsible public participation that will help prevent East Asian rulers from acting with impunity. PROGRAM AND MANAGEMENT CHALLENGESUSAID faces three main program and management challenges in the ANE region. First, in an environment of constrained Agency program and personnel resources, USAID will need to adjust available program and personnel resources to tackle heightened foreign policy priorities (i.e., Pakistan and Afghanistan; and increased efforts in basic education) without jeopardizing existing bilateral and regional development activities. Existing activities remain critical to achieving development progress and stability in the three subregions. Second, USAID must respond to requests to initiate or expand programs in nonpresence countries while identifying betters ways to manage nonpresence country assistance. USAID must be able to deliver meaningful development results toward achievement of US foreign policy objectives, even in an environment of constrained program and personnel resources. Finally, USAID looks forward to fulfilling the vision that is captured in the Global Development Alliance. Considering the daunting problems facing the ANE region, USAID programs alone are not enough. USAID must foster greater collaboration with key bilateral donors and private sector entities (foundations, companies, NGOs, etc) to leverage resources in order to maximize efforts and achieve the United States' foreign policy objectives. OTHER DONORSExcluding its assistance to Israel, the United States ranks third among donors in this region. The top two lenders are Japan and the World Bank, followed by the United States, the European Union, Germany, France, and the Asian Development Bank. USAID continues to work with these donors and United Nations agencies to reach a consensus on development priorities and to coordinate programs in every USAID-assisted country in the region. In particular, USAID will seek new opportunities to cooperate with Japan on parallel programs in Asia and the Middle East. FY 2003 PROGRAMFor the ANE region, $2,645,612,000 is requested for FY 2003 programs. Of this amount, $464.2 million is Development Assistance and $2.034.8 billion is Economic Support Funds, and $146.6 million is P.L. 480 (Title II) resources. A subregional breakdown of the FY 2003 request is as follows:
By USAID pillar, the FY 2003 request is as follows:
1. "South Asia Regional Brief," September 2000. |
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