Introduction FY2001 Program Crosscutting and Special Initiatives Summary Tables Program Summary Work Force Data Program/Sector Summary USAID Search: Eurasia Regional USAID Search: New Independent States Previous Years' Activities 2000, 1999, 1998, 1997 Monday, 05-Feb-2001 13:52:05 EST

Introduction

Since inception in 1992, USAID's assistance to Eurasian states has progressed from a regional program to a country-specific one. While initially the regional approach gave the United States the flexibility to respond quickly to varying needs across countries in a rapidly transforming environment, the program has matured. USAID now has more field representation which has provided improved knowledge of a country's transition environment and enabled development of country-specific strategies. Nevertheless, some activities are appropriately funded regionally because several countries are benefited.

Described below are activities that still operate regionally, across countries, including: regional enterprise funds; performance funds; contract personnel who provide technical services to more than one country; and regional conferences, working groups and courses that benefit participants from a number of countries. Activities of other U.S. agencies, which receive funds through transfers from FREEDOM Support Act (FSA) accounts, are in some cases applied regionally.

FY 2001 Program

USAID is pursuing the following strategic goals with regionally designated funds in the Eurasia:

Strategic Goal: Economic Restructuring

USAID seeks to foster the emergence of a competitive, market-oriented economy in which the majority of economic resources is privately owned and managed.

Privatization, Financial Sector, Fiscal Reform: Regional funds are requested to support special economic restructuring needs across the region. More recent initiatives emphasize commercial law and anti-corruption concerns. Funds are allocated to: Washington-based technical advisors who support field missions in activity design and implementation; service contracts that assist USAID with a variety of non-technical support functions; inter-agency service agreements, such as those with the Securities and Exchange Commission and the Department of the Treasury, and contracts, such as that with the National Securities Clearing Corporation, which help in performance monitoring, assessment and rapid response to needs across the region; and collaboration with other donors on anti-corruption initiatives in targeted countries. Funds will also be used for workshops to share lessons learned among countries in topics such as bank supervision, accounting reform and privatization.

Enterprise Funds: The CAR and West NIS Enterprise funds continue to foster private sector development by providing investment capital to small and medium-scale businesses in Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan and in Ukraine, Belarus and Moldova, respectively. Under the FY 1996 and 1997 Trans-Caucasus Enterprise Fund earmarks, the private investment fund partially guaranteed by the Overseas Private Investment Corporation, and the small enterprise lending program, managed by USAID, are fully funded and operational. An evaluation of the Europe and Eurasia Bureau's (E&E's) enterprise funds was carried out to assess impact of the overall program in promoting private sector development in the region. The evaluation reported that the funds provided venture capital in situations where financial markets were still evolving, and where the business environment was so uncertain that foreign investors were reluctant to commit funds to emerging small and medium-sized enterprises.

Energy: Given the international character of energy supply systems, USAID's program in this area facilitates regional energy cooperation, trade and investment. Activities in FY 2001 will focus on three major areas: (1) development of cooperation among the newly-formed energy regulatory agencies in areas of licensing, tariff development, market and grid code regulations and organizational development and public participation; (2) regional activities to support cooperation among Caspian states in legal, economic, financial and environmental aspects of oil and gas development and pipelines; (3) training, analysis and technical assistance related energy efficiency and environmental issues and mutually-beneficial options for reducing emissions in key countries in the Eurasia region.

Environmental Management: USAID has broadened its environmental focus beyond reducing health risks, placing greater emphasis on developing environmental management capacity to support sustainable economic growth. This shift reflects growing evidence that environmental policy initiatives and reforms need to be fully integrated into the economic reform and restructuring process at an early point to ensure that the transition takes full account of long-term environmental costs and benefits in a market environment. USAID encourages reliance on market mechanisms to the maximum extent possible in promoting higher environmental quality, while also recognizing that environmental costs and benefits are never fully internalized in a market system, and governmental agencies at both national and local levels have important regulatory roles to play. To implement this approach, USAID has developed an Environmental Partnership Program (EPP) that will be fully operational early in FY 1999. The EPP fosters partnerships between U.S. and regional entities aimed at finding market solutions to environmental problems and promoting application of U.S.-based environmental expertise, best practices, goods and services as part of those solutions. To maximize the impact of USAID's investment throughout the region, support will be provided to identify and apply cross-border lessons in the environment sector and to encourage regional networks.

Strategic Goal: Democratic Transition

Under this goal, USAID funds support the transition to transparent and accountable governance and the empowerment of citizens through democratic political processes.

Rule of Law: Funds are provided for technical assistance and training programs, targeting the organizations engaged in promoting legal reform. These activities foster the organizations' sustainability and the institutionalization of the reforms. Funds are also provided for regional anti-crime and corruption programs being implemented by USAID and various U.S. government law enforcement agencies, including Treasury and the Criminal Justice Division of the Department of Justice.

Local Government: Regional funding supports the creation of a regional network which will provide experience-based information to local government officials, municipal association members and relevant national officials for solving municipal problems and will improve their responsiveness to citizens' needs. USAID will support the full array of technical areas integral to the effective, transparent functioning of local governments and the continued enhancement of decentralization. These include municipal credit, local environmental planning, citizen participation, urban service delivery and infrastructure, local economic development, municipal budget and finance, condominium formation and maintenance, property and asset management, housing policy and finance.

Civil Society: Regional funding supports the creation and institutionalization of non-governmental organization (NGO) umbrella groups, the creation and survival of independent media, and the development of modern political parties.

Strategic Goal: Social Stabilization & Transition

During the next decade, USAID will increase its emphasis on the critical social issues arising from the transition process and from the legacy of economic, social, and political systems that existed before the start of the transition to market democracies. Disturbing social trends indicate that by itself, the approach to transition of building robust economies to improve living standards will not achieve broad-based prosperity and a good quality of life in the medium terms.

Thus, E&E is initiating new activities focused on the mitigation of transition-related social impacts and forming linkages between this strategic area and the economic restructuring, and democracy-building activities. This new area will enhance USAID's ability to undertake social reform activities within a coherent framework, and in relationship to the other transition objectives. This approach will help the E&E Bureau refine activities in the area of humanitarian response and health. In particular, this objective's activities will address selected critical unmet social needs in social insurance reform, unemployment, education reform, poverty alleviation, and protection of groups vulnerable to exploitation and neglect.

Humanitarian: USAID assistance responds to humanitarian crises and strengthens the capacity to manage the human dimension of the transition to democracy. Technical assistance places a strong focus on vulnerable groups feeding; strengthening local, social service NGOs; and leveraging multilateral assistance. In addition, some food aid and kerosene for winter heating are allocated on a contingency basis for most vulnerable groups in crisis situations.

Health: USAID uses regional health funds, complementing activities in individual country programs, to provide technical assistance and special initiatives for women's and children's health programs, control of infectious diseases, vaccine procurement and health partnerships between American health care institutions and their Eurasia counterparts. USAID activities increasingly emphasize disease prevention and the delivery of community-based primary health care services.

Cross cutting and Special Initiatives

Funds for programs which cut across a number of strategic objectives or which are not directly related to the achievement of USAID objectives.

Performance Funds: In a changing political environment, U.S. interests are best served by having a modest level of Performance Funds available for support of new or accelerating macroeconomic reform or superior performance in key economic sectors, such as with the Central Asian Republics Energy Initiative; or to respond to new reform opportunities. Funds are moved into country programs throughout the year as decisions are made on priority needs.

Southern Caucasus Regional: USAID funds humanitarian assistance, reconstruction and remedial activities for refugees, displaced persons, and needy civilians affected by the conflicts throughout the Southern Caucasus region.

Regional Training: USAID supports the Eurasia Training and Exchanges Project. Training programs funded under this project are directly linked to the USAID strategic objectives for each country. In order to maintain the project, certain functions are carried out regionally because of the economies of scale inherent in combining process functions. For example, regional training funds support maintenance of health coverage and data collection. In addition, regional funds are used for impact analysis, project monitoring and report preparation.

Other Agencies: Similarly funds are provided to other U.S. agencies such as the Departments of Treasury, Commerce, Justice, U.S. Information Agency, the Trade and Development Agency, and to the State Department for transport of humanitarian assistance commodities, and training and exchange programs.

Explanation for Special Initiatives and Cross-Cutting Objectives