• TABLE OF CONTENTS
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 Front Cover
 Title Page
 Table of Contents
 Preface
 Summary and conclusions
 Introduction
 Why should the United States have...
 What should be the main lines of...
 How should U.S. development cooperation...
 The next steps
 Back Cover






Group Title: New challenges, new opportunities
Title: New challenges, new opportunities : U.S. cooperation for international growth and development in the 1990s
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Title: New challenges, new opportunities : U.S. cooperation for international growth and development in the 1990s
Physical Description: Book
Language: English
Creator: Smucker, Ralph H.
Berg, Robert J.
Gordon, David F.
Publisher: Center for Advanced Study of International Development, Michigan State University
Place of Publication: East Lansing, Mich.
Publication Date: August, 1988
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Table of Contents
    Front Cover
        Front Cover 1
        Front Cover 2
    Title Page
        Page i
        Page ii
    Table of Contents
        Page iii
        Page iv
    Preface
        Page v
    Summary and conclusions
        Page vi
        Page vii
        Page viii
    Introduction
        Page 1
    Why should the United States have a leading role in development cooperation in the decade ahead?
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
    What should be the main lines of U.S. development cooperation in the 1990s?
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
    How should U.S. development cooperation be carried out?
        Page 27
        Page 28
        Page 29
        Page 30
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
    The next steps
        Page 39
        Page 40
    Back Cover
        Page 41
        Page 42
Full Text





NEW CHALLENGES
NEW OPPORTUNITIES

U.S. Cooperation for International Growth
and Development in the 1990s


* Ralph H. Smuckler and Robert 1. Berg with David F. Gordon













* Michigan State University
Center for Advanced Study of International Development


East Lansing, Michigan


01/ 5,30
13..,066






COOPERATION FOR INTERNATIONAL DEVELOPMENT
U.S. Policies and Programs for the 1990s
A Project of
Michigan State University
Center for Advanced Study of International Development
306 Berkey Hall
East Lansing, Michigan 48824-1111
U.S.A.
Telephone: 517-353-5925


Cooperating Institutions and Organizations

The following institutions and organizations have collaborated with Michigan
State University by sponsoring or co-sponsoring colloquia and symposia on various
aspects of development cooperation. The topics of these colloquia are listed in the
preface.
Association for Women in Development
Board on Science and Technology for International Development,
National Research Council
The Futures Group
Institute of International Education
Johns Hopkins School of Hygiene and Public Health
Midwest Universities Consortium for International Activities
Overseas Development Council
U.S. Council for International Business
Virginia Tech College of Architecture and Urban Studies in cooperation
with Washington Chapter, Society for International Development
Winrock International Institute for Agricultural Development
World Resources Institute


Authors

Ralph H. Smuckler is Dean and Assistant to the President for International
Studies and Programs and Professor of Political Science at Michigan State University.
He is currently chairperson of the Board on Science and Technology for International
Development of the National Research Council. Previously he served as chairperson of
the Research Advisory Committee of the U.S. Agency for International Development,
1973-82; director of the office to plan the establishment of the Institute for Scientific
and Technological Cooperation, 1978-79; and member of the USAID/BIFAD joint Com-
mittee for Agricultural Research and Development, 1982-84.
Robert Berg is President of the International Development Conference, Wash-
ington, D.C., and a member of the Steering Committee of the North South Roundtable.
Previously he was an official with the U.S. Agency for International Development,
1965-82, last serving as Associate Assistant Administrator for Evaluation, 1977-82,
and concurrently chairperson of the OECD Committee on Donor Evaluation. He was
Senior Fellow with the Overseas Development Council, 1982-88. He served as Vice-
President of the Society for International Development, 1985-88, and co-director of the
Committee on African Development Strategies, 1984-86.
David F. Gordon is Associate Professor of International Relations in James
Madison College at Michigan State University. He is also a core faculty member of both
the Center for Advanced Study of International Development and the African Studies
Center. He has served as a consultant to the U.S. Agency for International Develop-
ment, the U.S. Information Agency, and The World Bank.









NEW CHALLENGES
NEW OPPORTUNITIES

U.S. Cooperation for International Growth
and Development in the 1990s


* Ralph H. Smuckler and Robert I. Berg with David F. Gordon








* Michigan State University
Center for Advanced Study of International Development
East Lansing, Michigan


August 1988

























































Copyright 1988 by Michigan State University
Center for Advanced Study of International Devel-
opment (CASID).

Copies of this report ($5.00 each, postpaid) as
well as other publications related to the project are
available from CASID, 306 Berkey Hall, Michigan
State University, East Lansing, Michigan 48824;
Telephone: 517-353-5925.

Production coordination by University Publica-
tions, a Division of University Relations, MSU.

MSU is an affirmative-action, equal-opportunity
institution.







CI contents





a Preface........... v

Summary and Conclusions.......vi

Introduction....... I

Why Should the United States Have a Leading Role in
Development Cooperation in the Decade Ahead?.......2
Changes on the International Scene...........2
Changes in the Third World...........3
M Changes in the U.S. Position...........6
Implications for U.S. Interests...........8

What Should Be the Main Lines of U.S. Development
Cooperation in the 1990s?......... 11
The Context for Cooperation........... 1
M Guidelines for Cooperation........... 1
Urgent Issues........... 12
Third World Debt...........12
Africa...........13
Global Environment........... 15
M Substantive Content of Future U.S. Programs........... 15
Physical Well-Being: Health and Population........... 16
Health.........16
Population...........17
Sustainable Food Supplies: Agriculture and Forestry...........18
Environmental Improvement...........19
Urban Development...........20














Approaches to These Substantive Areas........... 21
Human Resource Development...........21
Science and Technology...........23
Policy and Institutional Development...........23
Mobilizing Diverse Energies for Development........... 24
Private Sector.........24
Nongovernmental Organizations (NGOs) in Development.........25
Women in Development.........25
Human Rights.........26

How Should U.S. Development Cooperation Be
Carried Out?.......27
Regional Balance...........27
Mode and Style of Operation...........28
Organizational Considerations...........29
The Coordination Imperative........... 31
Coordination in the Field........... 31
Coordination within the U.S. Government...........31
An Agenda for Domestic Coordination...........32
Multilateral and Bilateral Balance...........33
Reform of Food Aid...........34
Financial Implications...........34
Trends in Financial Contributions........... 34
Future U.S. Financing of Development Cooperation........... 36
Additional Ways to Finance Development Cooperation........... 37

The Next Steps.......39
Initiatives by the President and the Congress...........39
Building a New Consensus...........39










* PREFACE


This report draws upon a national proj-
ect organized by Michigan State University to
study and advise on U.S. policies of economic
cooperation with the Third World in the
1990s. Michigan State University was fortu-
nate in receiving support for this year-long
effort from the MSU Foundation, the John D.
and Catherine T. MacArthur Foundation, the
Carnegie Corporation, and the Pew Charita-
ble Trust and in being joined by a large num-
ber of leading scholars and experienced
policy makers who contributed papers and
other advice to this activity. A list of these
papers and authors is provided on the inside
of the back cover.
A number of leading U.S. institutions,
with the help of other foundations, sponsored
colloquia on specific development sectors as
part of this major inquiry. These institutions
and their topics were as follows:
* Association for Women in Development:
Gender Issues in Development Cooperation
* Board on Science and Technology for Inter-
national Development, Office of Interna-
tional Affairs of the National Research
Council: Policy for the 1990s: Science and
Technology for Sustainable Development
* The Futures Group: International Population
Assistance in the 1990s
* Institute of International Education: The
Role of Education and Training in Development
in the 1990s
* Johns Hopkins School of Hygiene and Pub-
lic Health: International Health in Develop-
ment in the 1990s
* Michigan State University Center for
Advanced Study of International Develop-
ment: The Changing Nature of Third World
Poverty in the 1990s
* Midwest Universities Consortium for Inter-
national Activities: Role of U.S. Universities in
the Development Task in the 1990s
* Virginia Tech College of Architecture and
Urban Studies in cooperation with the


Washington Chapter of the Society for
International Development: Urbanization in
Developing Countries: Potentials for U.S.
Development Cooperation
* U.S. Council for International Business:
U.S. Policy for the 1990s: Promoting Private
Direct Investment
Winrock International: Future of U.S. Devel-
opment Assistance: Food, Hunger and Agricul-
tural Issues
* World Resources Institute: U.S. Policy in the
1990s: International Cooperation for Environ-
mentally Sustainable Development

The Overseas Development Council
cooperated with MSU throughout the project,
particularly in organizing several symposia in
Washington to review papers commissioned
for the project and a preliminary outline of
this report. We have drawn extensively upon
this excellent work.
We are also grateful to Tom Carroll,
Director, and Doris Scarlett, Program Coor-
dinator, and the staff of the Center for
Advanced Study of International Develop-
ment. We thank Gordon Rohman, Michael
Schechter, and Tom Carroll of MSU for their
commentary on this report. We also want to
acknowledge the fine contributions of John
Sewell, Norman Uphoff, Jerry French, and all
of the colloquia leaders who offered com-
ments on drafts of this report. Appreciation is
also extended to the literally hundreds of peo-
ple who commented on the first draft of this
report during and immediately following a
major national conference held at MSU in
May 1988.
This report is the product of the authors
and should not be attributed to their institu-
tions nor to the numerous individuals and
organizations that cooperated on the project
by preparing papers and organizing collo-
quia. A variety of other publications will allow
these contributing authors and institutions to
speak for themselves and in greater depth on
their respective topics.







I Summary and Conclusions






As we enter a new decade and look forward to a new century, the
time is ripe for us to envision the better world we would want to leave
our children. What, we ask ourselves, should we strive for? At least three
cardinal objectives: broadly based growth, an effective attack on poverty,
and an end to the destruction of the environment. More than any other
nation in the world, we stand to gain from a global system that promotes
these objectives.
To accomplish these objectives, we believe the United States must
forge a new, a more mature relationship with the Third World. We need
to shift from the old idea of aid to the new idea of mutual gain through
cooperation. With developing countries as partners, we can progress
together into the 21 st Century. In this way, we serve both our political
and economic interests and satisfy some of America's most basic
humanitarian values. We also enhance our nation's long-term security
in an increasingly interdependent world.
Why is now a good time to make major changes in our engagement
with the Third World? Because the world has changed in the past sev-
eral years in global economics and politics, in our domestic economics
as well as in the Third World itself. The Third World is no longer a single,
homogeneous group of countries. Now they range from the very poor to
the newly industrialized. Global environmental problems loom larger.
All these changes in the world require us to change our way of relating to
the world. It is time to reexamine and recreate our policies and programs
for development, for progress in the developing countries is increasingly
important to this country.
Depending on their needs and on their importance to us, different
countries in the Third World will present different challenges. We espe-
cially need to move to a cooperative style with the strongly advancing
countries. In those less developed, however, we will need to maintain aid
while at the same time pointing toward new cooperative modes in the
future. Ultimately, of course, all Third World countries must themselves
be responsible for stimulating their own economic growth, for reducing
their poverty, and for improving their environment. The U.S. can, how-
ever, help and hasten the process.











vi















To this end, we should use our experience and skills:
to enhance physical well-being through improved health
systems and population planning;
to work for sustainable agricultural systems, particularly
emphasizing food supplies and forestry;
to develop environmental programs and policies that will pro-
tect natural resources and, through emphasizing renew-
able supplies and conservation, assure better energy
security; and
to foster sound urban development policies.
The latter two are new themes, whereas the former are older and
can be addressed now in more effective ways. We can approach all four
through our strengths in:
developing human resources, particularly at advanced
levels, in order to improve managerial capabilities;
using science and technology, especially to further local
capacities and to develop joint research programs;
fostering policy and institutional development; and
mobilizing diverse energies for development, with special
emphasis on the private sector, nongovernmental organi-
zations, women in development, and human rights.
While we are doing this, we must at the same time pay special
attention to three urgent problems: Third World debt, which endangers
both growth and the international financial system; Africa, where the
degradation of the environment and poverty imperil human life itself;
and global deterioration of the environment, which requires global coop-
eration.
New U.S. cooperation requires actions well beyond what any one
U.S. agency can do actions that will be broader than international
development policy alone. If we are to cultivate better our national inter-
ests, we need to coordinate better our national resources. The Treasury















Department, Trade Representative's Office, Department of Agriculture,
Peace Corps, Environmental Protection Agency and others all will play
significant roles as we address new problems and opportunities in the
developing world.
The Agency for International Development must change. Its struc-
ture and name ought to reflect the new theme and style of mutual gain
through cooperation. To this end it should expand its analytical capacity
and guide U.S. agencies toward a new U.S. relationship with developing
countries.
The new Administration should:
establish a council led by the White House to coordinate
U.S. agencies' actions and policies on development;
create a semiautonomous foundation to strengthen
research and the use of science and technology for devel-
opment;
consider the size and number of overseas missions as new
tasks and cooperative modes evolve; and
involve intermediaries more often and use binational coun-
cils and boards in countries abroad.
Our funding of aid is low compared to that of other industrial coun-
tries and to our past contributions. As we move vigorously toward our
goals with new modes of cooperation and greater effectiveness, prog-
ress will justify an increase in our official development assistance. In this
process we should sort out development funds from short-term political
and military aid so that cooperation for sustainable development can
build its own constituencies.
We should understand and evaluate development cooperation in terms
of our own interest in our three primary goals achieving broadly based
economic growth, effectively attacking poverty, and ending the degradation
of the world's environment. The President must lead; others will follow. It is
essential that he provide the vision of the better world we can attain for the
generations to come.








I introduction


The United States, more than any other
nation in the world, stands to gain from a
global system that promotes broadly based
growth, an effective attack on poverty, and an
end to degradation of the world's environment.
We have the most to gain for the same reason
that we would have the most to lose if, in the
years ahead, we do not realize such goals. As
the world's economic and scientific leader,
and as the largest nation living in freedom
and comfort, we cannot neglect playing a key
role in an interdependent world facing pro-
found global and domestic changes. In the
decade ahead we must cooperate effectively
with the nations and the peoples of the Third
World to attain these ends.
The world of the 1990s, and that of the
21st century, will be substantially different
from one in which a worldwide enterprise
known as "foreign aid" was launched forty
years ago. New circumstances make the con-
cept of foreign aid less appropriate. To much
of Asia and Latin America, the concept of
"cooperation for development" fits better. If
we are to address difficult issues successfully,
we must encourage cooperation for mutual
gain as an essential step toward maintaining
a progressive global system. Furthering our
own economic, humanitarian, and political
interests in the world will depend increasingly
on such cooperation.
By development cooperation, we mean
that we share responsibilities widely and
appropriately. The primary responsibility
must lie with the developing countries them-
selves. But the people and governments of
other countries, including the U.S., should
expect to join in this endeavor by contributing
resources and helping to shape policies.
Global progress will not come easily or
cheaply. But experiences of the last forty
years, both good and bad, have taught us
how to proceed in more reliable and cost-
effective ways. Among other things, we have
learned the possibilities and the limits of


transferred technology, the need to mesh cap-
ital and recurrent costs, the need to develop
human resources and institutions and why
we must avoid creating dependency and,
instead, foster self-reliance. We have seen
countries transformed from receivers of aid to
productive members of the global economy.
We ask ourselves, what kind of world do we
want to leave for our children? A world of dimin-
ishing opportunity? A world of slow economic
growth or stagnation? A world filled with
hunger and disease? A world of illiteracy? Of
eroding soils and shrinking forests? Of pollu-
tion and other environmental deterioration?
Of angry people and wasted human talent?
If we stand by, if we take a short-sighted
view, pursuing only narrow and immediate
interests, we will allow the uneven progress of
development in Third World countries to let
hundreds of millions of people sink further
from decent standards of life. Is that what we
want to leave as our heritage?
Our ability to lead the world into a new
century will no longer depend upon our eco-
nomic dominance. Instead it will depend on
the quality of our strategic thinking and our
skill at forming cooperative efforts to attack
complex problems. lust as the new reality of our
changing world opens new opportunities, so also,
in the decade ahead, does it pose new challenges
for our national leadership.
In this report we will address three broad
questions:
m Why should the United States have a
leading role in development
cooperation in the 1990s?
m What should be the main lines of
U.S. development cooperation?
m How should we carry them out?






W hy Should the United States Have a Leading

W Role in Development Cooperation in the

Decade Ahead?


As we review recent changes, both inter-
national and domestic, it is clear that we need
to change our policies and programs. It is also
clear that our national interests point to even
more active participation in international
development. The challenge will be to refine
both our purposes and our operations to keep
step with a new era.


* CHANGES ON THE
INTERNATIONAL SCENE

In the 1970s and 1980s, profound trans-
formations in the world economy ended
American economic supremacy. The eco-
nomic order created at the end of World War
11 provided a remarkable engine of growth.
Both the war-advantaged and war-damaged
economies of North America, Europe, and
Japan grew as did many of the developing
countries, especially in Asia and Latin Amer-
ica. Joining the United States as major actors
on the global scene were Japan, Canada, the
nations of the European community, and a
group of newly industrialized countries
(NICs). Most have now become significant
participants in international development
assistance, an activity whose early years
were dominated by the U.S.
Not only does the world economy now
have many more significant actors, but rela-
tionships among them are increasingly com-
plex. Organizational, scientific, and techno-
logical revolutions have made international
economic relationships ever more compli-
cated. The rise of the multinational corpora-
tion and international money center banks
created economic entities with global scope
and the communications revolution facilitated
split-second transfers of massive sums of
money. In the contemporary world economy,
trade, international private investment, and
global financial transfers are all inextricably
linked and growing. Truly the global economy
has arrived.


World exports, 1965-1986
The real value of world exports increased four-fold
between 1965 and 1980 and then declined 25 percent
during the global recession of 1980-1983.

$ billions, constant 1980*
2,000

World Exports
1,500


1,000

500

100
1965 1970 1975 1980 1985
'Deflated by the U.S. export deflator.

1965 1970 1975 1980 1983 1986
(5 billions, current)
World exports 186.5 312.0 872.7 2,002.0 1,813.5 2,133.0


Share of world exports
Industrial countries 68 9 71.9
Non-OPEC
developing countries 13.3 1 1.8
OPEC countries 6.0 5.8
Centrally planned
economist I 1.7 10.5


Ipcrcentages)
66 1 66.3 64.1 690
1 1.2 12.6 15.0 15.2
13.0 15.3 9.9 5.6
9.7 8.8 11.0 10.2


includes Asian centrally planned developing economies as well as Eastern
Europe.

Source" Published by permission of Transaction Publishers, from Growth.
Exports, and lobs in a Changing World Economy, by John W. Sewell and Stuart K.
Tucker, p. 208. Copyright 1988 by the Overseas Development Council. The
figure is based on data from United Nations. Monthly Bulletin of Statistics (luly
1981 and lune 1986), Special Table B, and GATT, International Trade 85-86,
Table A I.



There have been other fundamental
changes. The world has only recently
acknowledged how fragile are the global
commons and how threatened is the environ-
ment. Problems abound: acid rain, ozone
depletion, desertification, and the destruction
of rain forests. The speed of environmental
change has taken much of the world by sur-
prise. It poses a threat to the quality of life for


Profound
transformations in the

world economy ended

American economic

supremacy. m


















succeeding generations in all countries. We
are just beginning to realize something new.
Formerly, we felt that concern with the global
environment could be addressed by success-
ful economic development. Now, we are
beginning to understand we can attain develop-
ment only by protecting the global environment
and by balancing population and resources.
Evolving patterns of global politics
match the changes in the international econ-
omy and in the human and physical environ-
ment. A multipolar world has replaced the
bipolarity marked by U.S.-Soviet rivalry; the
ideological conflicts of liberalism and Marx-
ism no longer dominate the contours of inter-
national relations. Two particularly important
trends will have wide ramifications. First,
Marxist ideology as an organizing principle
for national development is declining. This is
seen not only in Europe and the Third World,
but most remarkably in the policy and ideo-
logical uncertainty gripping the Soviet Union
and China, the Communist giants.
The second is the rise of Mikhail Gorba-
chev to leadership in the Soviet Union. The
foreign policy implications of "glasnost" and
the domestic imperatives of "perestroika"
may open up possibilities for more pragmatic
treatment of world issues and a wider agenda
between the superpowers. This might include
joint attention to the "backwardness, hunger,
poverty, and mass disease" in developing
countries to which Gorbachev referred in a
response to President Reagan during the May
1988 summit in Moscow.


* CHANGES IN THE THIRD
WORLD

In the Third World, the most striking
development has been the rapid growth of the
newly industrialized countries South Korea,
Brazil, Taiwan, and others. During the first
thirty years of the postwar period, the Third
World expanded its manufacturing capacity


faster than did the industrialized countries. At
the same time, education and health systems
were built not only in the more advanced
Latin American states, but even in some of the
poorest nations in Asia and Africa. Life
expectancy increased dramatically with the
taming of several major diseases. But many
who reside in the Third World continue to live
in poverty. The promise of development has only
been partially fulfilled.



Life expectancy at birth, 1950-2000

Years
70


Latin America
60

Middle Asia
East


Sub-Saharan Africa
40


30
1950 1960 1970 1980 1990 2000
Source: Data and projections compiled in 1987 by The Futures Group.
Glastonbury, CT. from LIN and World Bank sources.


In the three decades following the end of
World War II, the Third World profited both
by the expansion of global trade and by sub-
stantial net resource flows from the industri-
alized countries to the developing countries.
These took several forms: foreign private
investment, commercial bank lending, multi-
lateral public investment, and bilateral foreign


AM any who reside in
the Third World continue

to live in poverty. n

















assistance. The flow peaked in the latter half
of the 1970s when Western banks recycled
OPEC petrodollars back into the developing
world at a rate of some $100 billion per year.
But in the 1970s major instabilities in the
international economy hit the Third World a
free floating dollar, huge energy price hikes,
and major unregulated movements of capital.
With the recession of the early 1980s,
skyrocketing interest rates, and the apprecia-
tion of the dollar, the recycling of the 1970s
became the debt crisis of the 1980s. As the
cost of servicing old loans was increasing, the
amount of commercial lending was decreas-
ing drastically. At the same time, aid fatigue
hit some donors, mainly the U.S. Net North-
South resource flows have ranged from negli-
gible to negative in the 1980s. Nonofficial
financial flows have virtually stopped for the
poor half of the developing countries. The
global financial system began to contract as
lenders judged some of the poorest countries
too risky for new loans.
With some exceptions, the 1980s have
been years of development crisis. Overall
growth rates in the developing countries, with
the exception of the newly industrialized
countries, dramatically decreased. For many
countries, this decade has produced eco-
nomic stagnation and new human suffering.
Per capital income fell appreciably in most of
Africa and much of Latin America.
The international response to the devel-
opment crisis of the 1980s has been programs
of economic stabilization and adjustment
supported by the donors. These have tried to
help developing countries reorient their poli-
cies to face the constraints of debt and
reduced resource flows. These programs
were a necessary response to chronic balance
of payments crises facing many developing
countries, but they have not been sufficient to
spur renewed development. At the same time,
they have been the source of mounting ten-
sion concerning international economic pol-
icy among the developing countries, the


Net resource transfers to developing
countries, 1973 to 1987


* All developing H Highly indebted
countries countries


* Low-income
Africa


Billions of dollars


73-79 80 81
average


82 83 84 85 86 87


T I980s have been

years of development

crisis. i















Poverty itself has changed

radically in recent years in

the Third World. u


Note: Net resource transfers are defined as disbursements of medium- and
long-term external loans minus interest and amortization payments on
medium- and long-term external debt.
Source: The World Bank, World Development Report 1988 (Oxford University
Press: New York. 1988). p.30.


industrial countries, and major international
financial institutions. There is a growing con-
sensus: renewed growth is not possible so
long as net capital flows are negative for
many developing countries.
The problems of poverty remain press-
ing. But poverty itself has changed radically in
recent years in the Third World. For some
among the poor, conditions have worsened
recently due to economic depression. The
move away from farms has lessened food
security for many, machines have replaced
labor, and new technologies have replaced
commodities. At the same time, many of the
poor now live longer, have better access to
basic health and education services, are eas-
ier to reach through improved communica-
tions systems, and in many areas are better

















organized. Aid donors and governments have
learned a great deal about better antipoverty
strategies. Nevertheless, these new ap-
proaches barely keep pace with the dynamic
evolution of the problems of the poor.
During the past forty years one of the
most radical transformations in history has
gathered momentum: the transformation of
women's roles and opportunities in society.
Women today live longer, have fewer chil-
dren, and are more likely to be literate, to
work outside the home, and to have political
and legal rights. An international consensus has
emerged that it is necessary to create opportuni-
ties for the full and equal participation of women
in all sectors.
Another significant change in the devel-
oping countries is that increasing numbers of
nongovernmental organizations are emerging
with capacity to plan and carry out programs in
low cost, participatory ways that conventional
programs have had difficulty attaining. They
can catalyze development as well as provide
services, explore alternative approaches, and
expand institutional capabilities.
We have seen an increase in managerial,
technical, and scientific capabilities and strong
development-oriented institutions in some parts
of the developing world. The existence of this
core of trained and skilled personnel necessi-
tates new norms of equality between donors
and recipients and opens up a range of poten-
tial relationships based upon more direct
mutual benefit, lying outside of the purview of
foreign assistance per se.
At the same time, rapidly changing tech-
nology in the industrialized economies has
challenged the still relatively small scientific
and industrial establishments in most Third
World countries to keep competitive. The
world is on the verge of a new Industrial Rev-
olution. It is likely to weaken the demand for


traditional raw materials and put poor coun-
tries at an increasing scientific disadvantage
in a more competitive global economy. The
loss of markets to new technologies (for
example, copper to fiber optics) is a likely
result. This poses a difficult challenge to those
countries relying strongly on international
markets in the years ahead.



Real commodity prices, 1970 to 1987

Index (1979-81 = 100)
150
125 33 Nonfuel Primary Commodities


1250


so Petroleum

25


1970 1975 1980 1985 1987
Note: Real prices are annual average nominal prices in dollars, deflated by the
annual change in the manufacturing unit value index (MUV). a measure of
the price of industrial country exports to developing countries,
Source: The World Bank. World Development Report 1988, op. cit., p. 25.


The politics of the developing countries have
also changed in several ways. The concept
"Third World" itself is losing force. It originally
denoted a set of widely shared characteristics
and a critical political movement. Both ele-
ments of the definition now have less
cogency. How useful is it, for example, to
group in the same category a newly industri-
alized state like South Korea, an impoverished
African state such as the Sudan, and a Carib-
bean microstate like Barbados?
For many countries, the very success of
development has led them to confront a new
range of issues and problems quite different
from those that the poorest and least devel-
oped still face. The idea of a "Third World"


t is necessary to create

opportunities for the full
and equal participation of
women in all sectors. m













he concept "Third
World" itself is losing
force. .


















D developing countries
now have a rich legacy of
experience, both in projects
and policies, from which
to draw... m








T United States has
both a large stake in
international development
and a wide range of
strengths and capabilities
that can contribute to the
process. m


still has some political meaning, but it is not
very useful for practical planning of develop-
ment cooperation in the 1990s. We use the
term in this report for lack of a better way to
designate easily a large and varied group of
countries that over the years have received
U.S. development assistance.
In many developing countries, adjust-
ment has caused a critical reevaluation of
their own performance in promoting growth
and development. There is also recognition of
the degradation of the environment and the
harm caused by high population growth
rates. Many countries have ceased blaming
the West for all failures and have accepted
their own responsibility for shortcomings in
development, including domestic policy fail-
ures and corruption. In the varied regions of the
developing world, there is a creative quest for
pragmatic solutions to development problems.
This attitudinal shift bodes well.
Although the international context for
development is less positive today than in the
recent past, developing countries now have a
rich legacy of experience, both in projects and
policies, from which to draw in future plan-
ning. We can point out many internationally
supported success stories: large-scale public
health campaigns such as smallpox eradica-
tion and oral rehydration to treat diarrheal
disease; broad-based improvements in agri-
cultural productivity in much of Asia as a
result of the Green Revolution's introduction
of high-yielding grain varieties and related
technology; and the vast experience of
smaller-scale projects. In Asia and Latin
America we can point to countries that have
graduated as recipients to become potential
aid donors. This range of successful policies and
efforts in all parts of the developing world offers
lessons for the future. Demonstrably, develop-
ment has a positive learning curve. One of the
lessons is the need for patience; change is not
an overnight process.


* CHANGES IN THE U.S.
POSITION

In 1988, Americans have been engaging
in a national debate concerning the status of
American power in the contemporary world.
Is America in decline? If so, what are the
implications? These basic questions are
under discussion more now than ever before.
The role of the United States in the develop-
ing world is being questioned. There are those
both here and abroad who have written off the
United States as a force for development. We
believe that this is wrong. To the contrary, the
United States has both a large stake in inter-
national development and a wide range of
strengths and capabilities that can contribute
to the process.
If power is defined in a purely relative
manner, then any other nation's success
diminishes ours. But the entire postwar expe-
rience challenges so narrow a concept of
power. Our success contributed to the suc-
cess of others and drew strength from it. As a
result, we now live in a world that is both
more competitive and more demanding of
international cooperation as we respond to
common problems and challenges. It is a
world that demands more mature relations,
both between the U.S. and the other indus-
trial countries and with the nations of the
developing world. Statesmanship in the 1990s
must artfully blend the competitive elements
of international relations with the cooperative
ones. This will be as true in the area of inter-
national development as in other aspects of
foreign policy.



















In a dramatic change from past decades, the
U.S. has now become the world's largest debtor.
Budget, trade, and financial imbalances
threaten both the long-term potential of the
U.S. economy and the world economy at
large. We need to make more efficient use of
available resources in government and pri-
vate-sector activities, including those involv-
ing the developing world. We simply must do
better with what we have.
America's capacity to participate effectively
in development cooperation activities with the
Third World has increased. Particularly in areas
of applied science and technology i.e., in
fields such as agriculture and farming sys-
tems, health, and environmental science the
range and depth of American capabilities to
match Third World needs is greater than ever
before. American universities, research insti-
tutions, and corporations are at the forefront,
expanding scientific knowledge of direct
importance to a wide range of developing
countries. But the ability of the U.S. to har-
ness this capacity has been constrained by
our own indebtedness, the budget deficit, and
waning support for foreign assistance.
A recent survey reconfirms that Ameri-
cans are ambivalent toward Third World
development. On the one hand, they are
uncertain about foreign assistance; on the
other, they support global humanitarian
activities. In the 1980s, Americans reasserted
their traditional commitment to improving
global well-being, especially of the under-
privileged and oppressed. The generous
response by the American public to the Afri-
can drought of the mid-1980s dramatically
showed this. But more importantly, in the
1980s nongovernmental organizations ex-
panded their roles in international develop-
ment. And on university campuses across our
nation, there is a renewed interest in the
Peace Corps and in career opportunities in
development.


Kinds of aid programs favored by the U.S.
public, 1986

"Now let's talk about what kinds of aid programs are
important. On a scale where I means lowest priority and
10 means top priority, using any number between I and
10, where would you place these types of aid?"

Percentages of respondents giving high priority (rate of
8-10) to enumerated kinds of aid programs:
Disaster relief lli I


Health care

Family planning

Aid to farmers
overseas
U.S. volunteer
programs
Reducing infant
mortality

Food aid
Help governments
improve national
economies
Infrastructure
projects
Military bases
overseas
Support local
small businesses
Education/
training in U.S.
Encourage U.S.
investment overseas


Debt relief I 1 I I 1 I 1
0 10 20 30 40 50 60 70 80
Percentages of U.S. public
Note: The margin of error for responses to this question is 2.8 percentage
points.
Source: Christine E. Contee. What Americans Think: Views on Development and
Third World Relations. A Public Opinion Project of InterAction and the Overseas
Development Council, New York and Washington, D.C.. 1987. p. 28.


lW e simply must do

better with what we

have. a

















* IMPLICATIONS FOR U.S.
INTERESTS

These recent and profound changes
must lead us to reappraise carefully our inter-
est in the Third World and its development.
Most broadly, our interest lies in the growth of
a healthy global system that will help to sus-
tain the values we cherish. By any measure,
the Third World is now an important part of
that system. What happens in Latin America,
Asia, Africa, and the Middle East makes a
substantial difference as we strive to build a
world in which broad-based economic
growth occurs, poverty lessens, and the envi-
ronment improves. We do, indeed, have the
largest stake in such a world, and conditions
prevailing in developing countries are an
important part of that world.
If the U.S. is to play its role well, we must
forge a new national consensus on the impor-
tance of Third World issues and international
development goals; and we must chart our course
sensitively, marshalling our capabilities in recog-
nition of new circumstances. There are humani-
tarian, economic, and political interests at the
base of such a consensus. What are these inter-
ests?
The bywords of the late 1980s in the U.S.
have been economic interdependence and the
need for competitiveness. But few Americans,
even among our leading policy makers, are
aware of the degree to which this interde-
pendence includes the developing countries.
Before the debt crisis, which inhibited devel-
oping countries' consumption of American
goods and services, the Third World was our
most rapidly growing market. In the early
1980s, the Third World purchased forty per-
cent of all American exports. In fact, invest-
ment in growth in developing countries has
had a more rapid and positive impact on our
trade than similar investments in the older


O ur interest lies in the

growth of a healthy global

system that will help to

sustain the values we

cherish. m











Few Americans...are
aware of the degree to

which interdependence

includes the developing

countries. n


industrial economies. U.S. agricultural sales
to South Korea, until recently a recipient of
U.S. aid, in one year exceeded in value all of
the P.L.- 480 aid flow ever provided to that
country. Thus, as we approach a new decade,
growing interdependence means that the U.S.
has an increasing stake in a healthy global econ-
omy, in which the Third World plays a significant
role.



U.S. exports to industrial countries and
developing countries, 1970-1986

$ billions, constant 1980*
140
U.S. Exports to
120 Industrial Countries/-

o00

80

60
ports to
40 Developing countries

20
0
1970 1975 1980 1985
'Deflated by the U.S. export deflator.
Source: Published by permission of Transaction Publishers, from Growth.
Exports. and lobs in a Changuing World Economy, by lohn W. Sewell and Stuart K.
Tucker, p. 210. Copyright 1988 by the Overseas Development Council. The
figure is based on data from U.S. Department of Commerce. Highlights ofU 5.
Export and inport Trade, December issues. 1970-1986.


We have both an economic and a
humanitarian interest in seeing that the world
grows economically with minimum damage
to the natural environment. In an ecologically
interdependent global system, severe damage
to the environment in one region affects other
regions. Recovery from environmental devas-
tation, if possible at all, will be costly to all
countries, including the United States. So the
attack on global environmental damage must
include attention to what is happening in the
Third World.
















With others, including developing coun-
tries, we share an interest in maintaining a global
economic system that enables our type of market-
oriented economy to continue and to prosper. We
benefit and so do others, when trade is rela-
tively open, when commercial transactions
proceed through orderly rules of trade and
finance, and when the rules for settling dis-
putes and shipping goods are widely under-
stood and accepted.
We also have a national economic inter-
est in the resolution of the Third World debt
crisis. The massive debt in a number of Latin
American countries, in particular, represents
the Achilles heel of the global financial struc-
ture as well as a major constraint on our abil-
ity to expand exports in order to reduce the
trade deficit.
The United States also has important politi-
cal interests in developing countries. Some are
more politically and strategically important
than others, but potentially we have at least
some interest in all. This becomes apparent
when one realizes the extent to which we
have become involved militarily since World
War II1, not in the Western World (the indus-
trial and economically advanced countries),
but in Asia, the Middle East, and Latin Amer-
ica. Tensions in these areas have mounted to
the political and military boiling points.
In the world we wish to pass on to the
next generation, we seek to promote and pro-
tect values of widespread citizen participa-
tion, respect for civil and human rights, and
rule of law. Fortunately, as we approach the
last decade of the century, the world is clearly
moving toward more open societies that will
pay more respect to these values.
The U.S. has an interest in cooperating with
the Third World in the resolution of a series of
pressing contemporary problems. Some of these
are domestic problems with an international
dimension: drugs, crime, and diseases such
as AIDS. Developing countries do not cause
these problems, but cooperation with these


countries must be part of our strategy for
attacking the problems. Some problems are
international but affect the quality of life at
home: maintaining a livable global environ-
ment, controlling infectious diseases, elimi-
nating locusts and other infestations, meeting
the challenge of terrorism, and managing
common property. All require a multinational
approach as part of the solution. Since Third
World countries are a majority in many inter-
national agencies that address these prob-
lems, they are, therefore, politically important
to us.
Americans have always been willing as a
nation and as individuals to help others. Our
national self-image dictates that we do our
fair share to alleviate famine and the worst
aspects of poverty. The citizen response to
the African drought reaffirms this view. Televi-
sion pictures of gross inequalities and poverty
prick our conscience and challenge our vision
of what the world ought to be and our
nation's role in it. Thus, the very humane val-
ues that form our nation's basic fiber dictate
that we offer a hand and do what we can to
alleviate poverty.
For all of these reasons, we have an
important interest in a wide array of Third
World countries and in their development.
Just as the array includes the poor at one end
and the more advanced at the other, our
response must vary and the tools available
must be numerous and well designed. In light
of these national interests, what are the impli-
cations of the changes of recent years for U.S.
development programs and policies in the
next decade?
These changes make it clear that our
nation must conceive these programs in a
much broader context than has been the case
in the past. The Third World is too important a
component of the global economy and environ-


T he very humane
values which form our
nation's basic fiber dictate
that we offer a hand and
do what we can to
alleviate poverty. m

















ment to be analyzed in isolation. Thus, any seri-
ous U.S. approach to Third World problems in
the 1990s must go well beyond the efforts of a
single development agency, central as the
Agency for International Development, for
example, may be to the process.
Taken together, these changes interna-
tionally, in the Third World, and in the U.S. call
us to rethink fundamentally the meaning of our
national security. In an earlier era, strategic
and military considerations dominated the
concept of security. Today, it rests also on
protecting the global environment, maintain-
ing a viable global economic order, and deal-
ing effectively with such widespread
problems as drugs, crime, and disease. These
could be as overwhelming to our societal
well-being as military actions or confronta-
tions. All call us to cooperate worldwide.
Without such cooperation our future is,
indeed, insecure.
An American President must develop a
broad understanding of the Third World and
its importance to us. To ignore these countries
poses unnecessary risk. We must beware lest
an episode that we little understand involves
us in a major confrontation. What post-
World War II President has not become seri-
ously embroiled in Third World areas in
South Korea, Southeast Asia, the Middle East,
or Central America? Is there a post-war Presi-
dent who did not suffer serious loss of reputa-
tion in the process?
Another advantage to our taking a lead-
ing role in development is this. We associate
with people and forces in the developing
world that are most likely to seek the type of
global economic and political system that
would support our own goals and values. At
the very pragmatic level, our development
cooperation programs open doors for Ameri-
cans both official and unofficial. American
ambassadors to Third World countries can


cite numerous examples. At the more practi-
cal and competitive level, our aid programs
have permitted us to match, or even push up,
the contributions of the many others who are
now investing in development programs. This
has been to our political and economic gain.
And at the more idealistic level, our role at the
forefront of development thinking and action
satisfies our needs to help others who at this
time in history are less fortunate.
So the answer to "Why should we have a
leading role in development?" is twofold: it is right
to do so because it is in line with our values and it
is practical to do so because it works to our
national advantage. The concerns as we enter the
1990s are not "should" but "what" and "how";
the issues are those of effectiveness, scope, and
style appropriate to the 1990s and a new century.


T e concept of
security...rests also on
protecting the global
environment, maintaining
a viable global economic
order, and dealing
effectively with such
widespread problems as
drugs, crime, and
disease. m







I W hat Should Be the Main Lines of U.S.

w I Development Cooperation in the 1990s?


We now turn to consider the array of
activities to encourage growth, to protect the
environment, and to alleviate poverty. These
goals will be difficult to realize; we can
achieve none through simple actions. In our
view, the U.S. in its own interest must be pre-
pared to respond to varying needs, not to limit
its response to only a narrow band of choices.
However, in each country or region, depend-
ing on U.S. interests and our comparative
advantages, different combinations of U.S.
efforts should be employed. We will have
to make hard choices in view of limit-
ed resources and concentrate on things we
do well.


U THE CONTEXT FOR
COOPERATION

Why are some Third World countries
progressing and others not? The answer con-
tains a bundle of virtues and sins. Sound
development depends on the ability and motiva-
tion of people, prudent policies, well functioning
institutions, and sustainable use of natural
resources. Good development strategies must
build on multiple talents within societies and
take advantage of external as well as internal
economic opportunities. Domestic political
tranquility and a political dynamic that per-
mits fresh thinking are essential.
Over the last decade recognition of the
importance of these factors has increased
markedly and this is to the good. Unfortu-
nately, financial constraints have sometimes
prevented action based on this new wisdom.
In other cases, local elites have siphoned off
power and resources to nonproductive ends,
inhibiting or stifling opportunities for wide-
spread progress. On balance, the good news
outweighs the bad, but it would be naive to
ignore the difficulties. On the contrary, a
sound policy of development cooperation will
work through or around them; history has
shown the difficulties should not be consid-
ered insurmountable.


Contrary to the general impression, the
Third World itself finances the vast bulk of devel-
opment in the Third World. Aid programs con-
tribute altogether only about 10 percent of the
Third World's total development investment.
(In many countries the proportion is much
higher as in Sub-Saharan Africa.) Foreign
talent and financial resources often provide
an impetus that would otherwise not be
present. The primary contribution foreign
donors can make is quality assistance, since
quantity, by any measure, is modest compared to
total investments and problems addressed.
The quality issue is of special impor-
tance to the U.S. as we approach a new dec-
ade. There are many other bilateral and
multilateral donors. The U.S. share is dimin-
ishing. If we wish to serve our purposes and
the needs of development, we must pay par-
ticular attention to the quality of what we
offer. Because of this, our project examined
not only what Third World countries ask of
us, but also the main strengths we can offer in
response in the 1990s.


* GUIDELINES FOR
COOPERATION

At the outset we stated three goals of a
development cooperation program for the
1990s. They are interrelated but not equally
applicable in every Third World country. As
we move toward these goals, we should do so
within certain guidelines.
Our programs should be cast in long-
term perspective. Most tasks cannot be accom-
plished in three or even five years. In some
cases we must consider the proper planning
cycle to be ten years or more. In relatively
advanced situations, we should encourage
long-term linkages and networks.
Development cooperation between the
U.S. and Third World nations should involve
the public, private, and voluntary sectors both in


The U.S. in its own
interest must be prepared
to respond to varying
needs, not to limit its
response to only a narrow
band of choices. s

















the U.S. and abroad. There will be consider-
able variance from one country to another in
the balance. But a mix of the three will be the
common pattern.
U.S. involvement must respond to real
needs and to informed voices in developing
countries. These voices will come from vari-
ous sources. Not all needs can or should be
answered by a U.S. bilateral response. But we
should offer no response unless needs ema-
nate from the country. With rare exception,
we should not design bilateral programs on
our own diagnosis or initiative, with only pas-
sive approval coming from the country.
Our program should be capable of
diverse responses. The situation should guide
our response. We should design program
instruments and management arrangements
with this flexibility.
We should work in ways that would
strengthen the growth of pluralism in Third
World societies. We should consciously
include, therefore, a number of nongovern-
mental organizations, private-sector entities
and other decentralized units as often as fea-
sible in planning and implementing coop-
eration.
Our responses to developing countries
should be both bilateral and multilateral. Both
have advantages. Multilateral agencies are
best in some circumstances (such as the
World Bank for macroeconomic adjustment
and the WHO for smallpox eradication); bilat-
eral U.S. programs are best in other situa-
tions.
Finally and above all, our programs in
the decade ahead must reflect a commitment
to cooperation for development. This pervasive
theme must guide our actions with the poor-
est countries, where certain assistance in-
struments will still be appropriate, including
straightforward relief at times, as well as with
those countries at a more advanced stage,
where cooperative linkages and joint research
on global problems may be the predominant
pattern. We must be willing to plan jointly,
establish goals together, and share financing
and other responsibilities. This cooperative


style must prevail and become the basis of
our interaction with the Third World in the
1990s. As countries progress, we should
encourage programs providing mutual
benefits.
What do we mean by cooperation and
mutual gain? What would be new in development
cooperation programs based on mutual benefit?
First and foremost, both sides would expect
results to further their own interests. The
activities themselves, carried out by public or
private agencies or institutions on each side,
might include research, training, explorations
of the use of technology, joint business or
educational ventures, and a range of other
possibilities. Each party would share in defin-
ing, planning, and operating. Each would
share financing on some negotiated basis. As
a part of such an approach, we would expect
the formation of some multi-country endeav-
ors and, perhaps, regional networks.
The role of the U.S. development coop-
eration agency would be to facilitate and
encourage such projects at the outset, help to
bring the parties together, and, in some
instances, provide temporary support or con-
tingency finances.


* URGENT ISSUES

Before we suggest four important sub-
stantive themes for U.S. development cooper-
ation for the 1990s and a number of
approaches to them, we feel that urgent
attention must be directed to three tasks.
They concern development but go far beyond.
They require more than U.S. action and,
within the American official stance, far more
than just development agency action.


Third World Debt

In the summer of 1982, when the Gov-
ernment of Mexico announced that it would
not be able to meet its foreign debt-service
obligations, the Third World debt crisis


A cooperative style
must prevail and become
the basis of our interaction
with the Third World in
the 1990s. m
















began. Since then, the debt crisis has been
prevented from escalating into a crisis of the
entire international financial system. But the
debt strategy of the IMF and World Bank, in
which loans have been disbursed in return for
recipient government initiatives to stabilize
and adjust their economies, have failed to
resolve the crisis and, in particular, to restore
acceptable rates of economic growth. In many
countries there is too much truth to Julius
Nyerere's haunting question: "Must we starve our
children to pay our debts?"



Debt-GNP ratios in developing countries,
1975 to 1987

Percent
80
Low-Income Africa
60
Highly Indebted
Countries
40

20 II Deeloping Countries

0
1975 80 81 82 83 84 85 86 87
Notes: Data are based on a sample of ninety developing countries. The
debt-GNP ratio is defined as the dollar value of outstanding medium- and
long-term debt expressed as a percentage of dollar GNP.
Source: Figure based on data from The World Bank. World Development Report.
1988. op. cit., p. 31.


In the 1990s, for a substantial number of
Latin American and African countries, real
development progress will depend upon
reducing the burden of debt service. Politi-
cally, the debt is the source of increasing anti-
American demagoguery. The Third World
debt burden also hurts the global economy at
large and the American economy because it
restrains further expansion of U.S. exports to


the developing countries. Thus, there is a
strong case for new initiatives to break the
bottleneck of the Third World debt crisis.
We leave to others the writing of the pre-
scription to ease this difficult, complicated
problem. We do note, however, that in the
past several years market forces have lowered
the value of Third World debt. A secondary
market, at large discounts, has developed,
and stock values of those financial institutions
with heavy Third World exposures have
weakened. This market devaluation of Third
World debt offers new opportunities for debt
management. The task is to create mecha-
nisms and opportunities for the indebted
countries themselves to reap a share in the de
facto market devaluations. Such a solution
calls for U.S. leadership.
In recent months, we have seen a num-
ber of innovative plans tabled based on this
general principal. Most see a vital role for the
World Bank as the institution that has long
combined financial acumen with a deep com-
mitment to development. Although not endors-
ing a specific proposal, we urge that the U.S.
government thoroughly explore options with an
eye on support for such initiatives.
Why is the debt issue germane to con-
sideration of U.S. development cooperation?
Because it is fundamental to the prospects for
development and, more technically, relates
potentially to use of foreign assistance
accounts and, possibly, to past foreign aid
loan repayment. Failure to find viable solu-
tions to the debt problem will mean another
lost decade for development in much of Africa
and Latin America as well as continuing limits
on our ability to restore balance to our own
external economic relations.


Africa

Africa presents a second set of urgent
issues. Although a handful of sub-Saharan
countries have achieved and maintained
development progress, Africa generally is in
crisis. For two decades, population growth


failure to find viable

solutions to the debt

problem will mean another

lost decade for

development in much of

Africa and Latin

America... N

















has outstripped agricultural productivity.
During this time, two major famines have
swept across the continent. Economic growth
rates have plummeted. We do not exaggerate
when we say that the basic building blocks of
societies education, food, and health are
at risk in large parts of sub-Saharan Africa.



Per capital food production, 1961-65 to
1983
(1961-65 average = 100)

130
120 Latin America


I 10 / a

90 Sub-Saharan rt'rica

80


T e basic building

blocks of societies -
education, food, and

health are at risk in

large parts of

sub-Saharan Africa. n

























W have seen a new

determination in Africa, a

somber realism about the

challenges to be faced. m


1970 1975


1980 1983


Source: The World Bank, Toward Sustained Development i Sub-Saharan Africa
(World Bank: Washington, D.C.. 1984), p. 15. as cited in Compact for African
Development. Report of the Committee on African Development Strategies. A
joint Project of the Council on Foreign Relations and the Overseas
Development Council, New York and Washington, 1985. p. 9.


Africa also faces an immense environ-
mental crisis including deteriorating soil fertil-
ity, vast areas where scrub brush and forest
have been removed, rapidly advancing des-
erts, and diminishing groundwater supplies.
Whole peoples, such as Africa's thirty million
pastoralists, are in jeopardy.
Unless deteriorating conditions are
turned around, an increasing number of Afri-
can countries will suffer economic stagna-
tion, increasing poverty, environmental
degradation, and decay of their already fragile
social and political institutions. Should this
occur, not only will a major continent become
increasingly marginal to the international


economy and society, but the lives of millions
of Africans will be unbearably bleak. We can-
not stand by and watch Africa move to wide-
spread disaster. Our sense of humanity will not
permit it.
What is to be done, and what role
should the U.S. play? Sub-Saharan Africa's
plight does not call for simple or cheap solu-
tions. The subcontinent's complex problems
must be attacked on a number of fronts. Basic
policy, institutional, and infrastructure ques-
tions must be addressed. Long-term actions
to cope with long-term agricultural, environ-
mental, population, and human resource
development problems are needed.
We must encourage attention on five
fronts:
Sharply reduce debt burdens for many
countries. Much of this debt is from
official agencies rather than private
banks, so the negotiations take on a
special character.
Lay the base for locally relevant
agricultural research. Africa's stockpile
of agricultural scientists is the
thinnest of any comparable area and
is an unacceptably small legacy for
its future.
Address health and population
problems that are interrelated but
demand both independent and joint
action.
Confront Africa's environmental
degradation directly. Africa needs
sustainable agricultural practices and
national and local projects to reforest
and stop deserts.
r Counter the devastation of continued
warfare in Southern Africa. Prepare the
region for cooperative endeavors,
whether or not South Africa turns
from apartheid in the 1990s.
These urgent tasks will call for African
governments to carry out their responsibili-
ties effectively. Since the last famine we have


1961-65
average
















seen a new determination in Africa, a somber
realism about the challenges to be faced.
With long-term external support, enhanced
by strong U.S. participation, we can reinforce
and accelerate this move to find African solu-
tions to basic problems.


Global Environment

Global environmental issues go well
beyond what an American development
cooperation program can handle. They call
for concerted international efforts and a major
role for the United States both in reforming its
own domestic performance and in helping to
construct effective international action. With-
out such an approach, the long-term viability
of a good many international development
strategies is open to serious doubt.
The international community must bring
together sufficient scientific and political
power to launch a credible global strategy
commensurate with the global problems now
becoming manifest. Among possibilities to be
considered are an international summit meet-
ing on the environment and an expanded
mandate for the UN Environment Program.
Such considerations must proceed in a spirit of
urgency and clear vision as to the potential scope
of the problems.


* SUBSTANTIVE CONTENT
OF FUTURE U.S. PROGRAMS

In view of the wide array of conditions that
prevail in Third World countries, we should be
prepared to apply a range of approaches. In
some of the poorest countries, our coopera-
tion will focus heavily on alleviating poverty,
expanding productivity, and building capacity
for growth. In the more advanced countries,
our attention should focus on mutually bene-
ficial gain, including trade development, joint
research, and energy efficiency. At whatever


level, our substantive efforts should draw on our
comparative advantages within certain common
themes.
We are not suggesting that all four of the
themes we are proposing provide an abrupt
break with the past. There is no reason to expect
to identify completely new ways to approach
problems that are, in most cases, not new in the
world. On the contrary, we urge building on
the past, learning from our experiences, and
applying these lessons in new ways and with
sharper focus to gain greater effect. In the
process, we should stop doing what we are not
doing well.
The four themes that we suggest were
drawn from the colloquia and analyses that
have been part of this project. They are our
best estimate of developing country needs in
the 1990s and key on the areas that provide
the most opportunity for the U.S. to contrib-
ute and to gain. The first two are continuing
themes of the past; the latter two are new
major emphases and reflect the needs of the
future. They are as follows:
Physical Well-Being: Health and
Population
N Sustainable Food Supplies:
Agriculture, Forestry, and
Agro-industry
l Enhancing the Environment
m Urban Development
Each of these four can proceed on a
basis of cooperation for mutual gain. But each
is important, also, for attacking poverty con-
ditions. Historically, the alleviation of poverty
and the expansion of opportunities for
mutual gain go hand in hand as poor coun-
tries grow economically. We have already
referred to the example of South Korea, but
we can also cite other countries in Latin
America and Asia. This progression has
occurred often enough to justify some con-
fidence.
Reducing poverty is difficult. If it were
open to a quick fix, poverty would have been
eliminated years ago. Poverty cannot be


he international
com uiniitil must bring
together sufficient scientific
and political power to
launch a credible global
strategy commensurate
with the global problems
now becoming manifest. E


















or poverty to be
alleviated, growth must be
promoted and wise use
made of the resource
base. M












Profound economic
changes combined with
the global emergence of
new health problems such
as AIDS, substance abuse,
and illnesses related to
environmental
degradation are causing a
major reconsideration of
health policies and
strategies. M


reduced for long without expanding produc-
tion. For poverty to be alleviated, growth must
be promoted and wise use made of the
resource base. Economic opportunity must
be expanded. The right incentives for growth
and the basic physical and market infrastruc-
tures must be provided. There must be a
sense of broad sharing of results as well.
Finally, an investment must be made in peo-
ple's health and education. People must have
access to resources and technology and to the
benefits of expanded productivity.
Our increasingly interdependent world
provides daily illustrations that the actions of
the North in general (and often the U.S. in
particular) can greatly affect the prospects for
the alleviation of poverty in the South. Thus,
we call for an integrated set of policies, not
just development programs, that address
both international and domestic constraints
to lessening poverty.
With this as background, we describe
the substantive themes that we find to be
appropriate to the situation of the 1990s. Rel-
evant colloquia have produced more detail
and substance than we can provide in the
summaries that follow.


Physical Well-Being: Health
and Population

Health
Since World War 11 we have seen dra-
matic improvements in human well-being
and a remarkable increase in life spans,
achieved in large measure by wide dissemi-
nation of biomedical technologies such as
antibiotics and insecticides coupled with the
development of basic health infrastructures.
In recent years, however, profound economic
changes combined with the global emergence
of new health problems such as AIDS, sub-
stance abuse, and illnesses related to envi-
ronmental degradation are causing a major
reconsideration of health policies and strat-
egies.


During the past decade, two key develop-
ments have led to important redirections and
strategies for provision of health services. First,
there is the primary health care movement that
is producing a shift from the traditional
emphasis on costly curative care services to
vastly more cost-effective community-based
interventions and affordable primary care
services. Second, there are the revolutionary
developments in biomedical research that offer
promise of dramatic advances in dealing with
many of the most serious health problems of
mankind.
We believe the public health experts
with whom we have consulted are correct in
identifying the following strategic approaches
for U.S. policies and programs in the decade
ahead.
Technology development and transfer.
Effective and inexpensive technologies are the
keys to primary health care improvement.
The new research tools in immunology and
molecular biology offer the promise of a
larger array of chemotherapeutic agents, vac-
cines, and diagnostic tests that have the
potential of markedly transforming health
conditions in tropical countries. To assure
that potential benefits of biomedical advances
reach developing countries, we must encour-
age a close liaison among basic scientists,
epidemiologists, and social scientists. Re-
search must be directed toward the produc-
tion of the most appropriate tools for disease
control in the developing country setting. This
effort is severely hampered by a shortage of
trained and experienced researchers both in
the U.S. and the developing world, a shortage
that we must address and help correct.
Primary health care program implemen-
tation. Effective PHC programs require
strengthened leadership and management
capacity in ministries of health to establish
policies and define strategies to improve
health. These activities will require vast
improvements in professional and technical
skills in fields such as epidemiology, opera-
















tions research, economic analysis, and finan-
cial management. Furthermore, health pro-
grams must be operationally decentralized to
assure that effective and affordable services
are available to communities and families.
There is a need to reorient health training to
develop a new cadre of professionals with the
requisite skills to meet these needs of primary
health care programs.
Strengthening the global effort. Efficient
use of tight U.S. funding will require strength-
ening capabilities to mobilize technical, man-
agerial, and financial resources available
nationally and internationally. We must
increase efforts to utilize these resources effec-
tively. Academic centers in the United States
have substantial resources and potential for
conducting biomedical research and exten-
sive capacity for training and assisting
researchers from developing countries. Non-
governmental organizations are also sources of
strength and are making innovative contribu-
tions in the health area. They are especially
suitable for flexible action and creative
research and training. Commercial enterprises,
because of their long-term interests in coun-
tries where they operate, represent another
stable resource base we should call upon.
Multilateral agencies such as the WHO, UNICEF
and the UNFPA bring strength in their ability to
discern a worldwide strategy on issues that
transcend national boundaries such as pri-
mary health care, child survival, population,
and, most recently, the global AIDS program.
We must devote far more attention to increas-
ing the coordination of these U.S. and inter-
national resources to effectively address
health problems on a global basis. We should
also cooperate on vertical campaigns empha-
sizing targeted interventions such as
UNICEF's campaign to reduce sharply the
rates of infant mortality.
We must strengthen capacities to set
priorities, plan strategically, and provide
financial analysis in the developing countries


as well as in the donor community. In such
matters, the health community should study
other successful and innovative organizational
arrangements, such as the Consultative Group on
International Agricultural Research, which is
addressing international agricultural research
and program needs.

Population
The world's population will grow by another
billion people in the 1990s. No one greets this as
good news. Nations cannot achieve the social
and economic goals they seek with extremely
high population growth. That is why some
sixty-four developing countries have policies
favoring lower rates of population growth. To
implement these policies, nations are provid-
ing couples with the information and means
to plan their families, are improving maternal
and child health, and are linking population
programs to the other key aspects of their
planning, e.g., environmental issues, food
policies, and educational services.



Past and projected world population,
1200-2000

Population (billions)
7

6

5
Total w\orId
4 Population


2
i\ eloped Couniries
I I' ulalion *


1200 1400 1600


1800 2000


Sources: The World Bank, World Development Report 1984 (Oxford University
Press: New York. 1984), p. 3. and World Development Report 1988, op. cit
pp. 274f., 289.


W e must devote far

more attention to

coordinating...U.S. and

international resources to

effectively address health

problems on a global

basis. m




















Some sixty-four

developing countries have

policies favoring lower

rates of population

growth. N





















Hunger results from
poverty and environmental
degradation, not just from
a lack of production of
food..


The number of couples in the developing
world (excluding China) using effective family
planning is expected to more than triple from
120 million at present to 390 million by the
year 2000. To meet this demand requires
rapid expansion of all aspects of service
delivery.
Successful population programs depend on
the commitment and resources of countries them-
selves. But although this commitment is abso-
lutely necessary, it is often insufficient. The
support of the international community has been
vital to bolstering national resolve and provid-
ing resources for successful long-term pro-
grams. The U.S. Agency for International
Development has been the acknowledged
leader in this effort. In the 1990s we believe it
imperative to reaffirm the historic American
commitment to family planning. Particularly,
we should resume support of the two most
widely connected and respected population
agencies: the UN Fund for Population Activi-
ties and the International Planned Parenthood
Federation.

Sustainable Food Supplies:
Agriculture and Forestry

Given the growth of grain production in
the world in recent years, we know that hun-
ger results from poverty and environmental
degradation, not just from a lack of produc-
tion of food. Deaths from starvation and mal-
nutrition still outnumber deaths from all
wars. Yet the war on hunger goes on at an
intolerably slow pace in a world of substantial
wealth.
Until early in the next century, most
Third World people will still live in rural areas.
Poverty alleviation will be necessary in rural
areas where, by all indicators, the less well-
off will continue to live in largest numbers.
Particularly for the poorer countries, agricultural
growth will lead economic growth.


In recent years policy makers have
linked the term "sustainable" with recom-
mended policies for agriculture and rural
development. We need major policy changes,
indeed new development strategies, to restore
and protect the water, land, and forests on
which the survival of the rural poor depends.
If the poor are to benefit from new strategies,
they will need access to low-cost technolo-
gies, information, and credit, as well as
enhanced security for their lands. Policies
must not only provide for sustainable produc-
tion in often marginal, poorly watered lands
but must provide for restoration of damage in
many lands heavily eroded and degraded.
The U.S. has traditionally placed food and
agriculture programs in the Third World at high
priority. We must continue to do so in view of the
needs, the basic nature of the sector, and the
knowledge and technology available in this coun-
try. Our attention should be given to research,
to policy analysis that underpins programs to
attain food security, and to training and insti-
tution building in selected countries and
regions.
Major gains in the production of food
can be attained in the years ahead. Food
security for practically all of the world's poor
should be attainable in the 1990s, with the
exception of those living in sub-Saharan
Africa, which has a less beneficent climate
and greater environmental degradation. This
process will require a second Green Revolu-
tion, a gene revolution, which assures higher
productivity to the marginal farmer and better
protection of the resource base. Even so, not
all areas will be food self-sufficient at all
times. This means that many areas must fos-
ter nonfarm employment and nonagricultural
productivity in rural areas, including agricul-
tural processing, storage, and transport.
To have real meaning, the gains in rural
areas must be sustainable and must reach the
poor both as producers and as consumers.
The poor must have more purchasing power
if they are to improve their nutritional well-
being. A start has been made through
research focused on needs of the poor, agri-
















cultural price policies beneficial to small
farmers, and agricultural credit and extension
services directed to women and men who
farm on a small scale. We must do more in
these areas.
Agricultural research has consistently had
one of the very highest rates of return to develop-
ment, but it still suffers from serious underinvest-
ment. Some countries still need to build
training and research capacities, and others
need to sustain cooperative linkages and net-
works to assure continued quality and target-
ing of effort. The countries themselves and
the donors need to renew their dedication to
rapid development of national research
capacities in the developing countries. The
important role of the International Agricul-
tural Research Centers must be maintained.
Their research needs to be devoted increas-
ingly to problems of marginal and degraded
areas. We should encourage and support
universities and other agricultural research
institutions in the industrialized nations,
especially those in the U.S., to give priority to
research that addresses needs in developing
countries. The Collaborative Research Sup-
port Program has been innovative and helpful
in this respect.
Forestry is important for several reasons: for
rural development, through the production of
fodder and housing materials; for production of
renewable energy supplies; and for countering
adverse global environmental trends. In the
years ahead planting of trees on farms will be
one of the most efficient ways to restore and
sustain local wood supplies, promoting refor-
estation and improved crop productivity. The
U.S. has much to offer in these efforts, and an
active program in the 1990s could have sub-
stantial impact.
At the same time that nations strive to
provide food security for their peoples, we
must continue to provide concessionally
financed food to cover food deficits in the
poorer countries. U.S. programs under P.L.-
480 provide significant potential to supply
food for particularly needy groups. Reform of


these programs (discussed below) may well
be necessary if we are also to preclude disin-
centives to production, to reach targeted
groups, and to expand secondary benefits,
such as food-for-work programs.


Environmental Improvement

Agriculture and all other programs in
Third World countries should be environ-
mentally sensitive. There are also other global
environmental issues that merit special atten-
tion, especially the restoration and protection
of tropical forests and the environmental
problems associated with energy production
including the greenhouse effect. Attention to
these global concerns was singled out above
as an urgent issue.
People do not understand the scope of the
environmental challenge facing the world.
Although single trends are often seen, rarely do
we grasp the cumulative nature of the adverse
trends in temperature, radiation, pollution of the
air, soil and water, desertification, deforestation,
and species reduction. They add up to a global
environmental crisis rapidly gaining in inten-
sity. The U.N. Food and Agriculture Organiza-
tion predicts that, by the end of the century,
29 percent of the productivity of rain-fed
croplands will be lost because the nutrient
and organic matter in the soil are depleted or
the land is degraded, polluted, or eroded.
In the developing world, ten trees are cut
down for every one that is replaced (29 for
one in sub-Saharan Africa), and forest animal
and plant species are disappearing at an
unprecedented rate. Fuel-wood shortages
now affect an estimated 1.5 billion people in
sixty-three countries. Often old strategies to
attack these problems settlement of fragile
tropical forests, large dams, and continuous
irrigation schemes failed because they
could not be sustained economically or eco-
logically over the long run. Although the scale


ood security for
practically all of the
world's poor should be
attainable in the
1990s... M

















he U.S. can provide
leadership in identifying
and analyzing
environmental problems
and developing strategies
to deal with them. u














T United
States...should increase
attention given to energy
for development
activities. 0


of these problems is beyond the ability of pro-
grams of U.S. development cooperation
alone, the U.S. can provide leadership in iden-
tifying and analyzing such problems and
developing strategies to deal with them.
There is a need to build capabilities to
provide reliable analyses to Third World gov-
ernments, to assure that programs supported
by the U.S. government operate with environ-
mental insight, and to help launch special
programs in Third World countries of
national or global environmental importance.
Among the latter may well be multicountry
programs to protect vital tropical basins and
watersheds. Some special programs in poor
countries may aim not only at their own envi-
ronmental security but at that of their neigh-
bors, e.g., Nepal vis-a-vis India and coastal
West Africa vis-a-vis interior West Africa.
Some of these actions will defy conven-
tional economics, conventional obligations of
the state, conventional roles of multilateral
institutions, indeed conventional notions of
security. Fresh thinking and innovative action
will be necessary. Business as usual would
mean a virtual neglect of these issues, and
that can be entertained as an option only at
our long-term peril.
Every stage of the development process
needs energy and every way we use energy
affects the environment in demand on for-
ests, in health, and in the global atmosphere.
Developing nations spend large proportions
of their capital and foreign exchange on
energy. Their poor spend large portions of
their income and time on household fuel and
energy for basic agricultural and industrial
processes.
The United States, already active in this
area, should increase attention given to
energy for development activities. This is
especially important for household fuel and
rural development where the requirements of
the poor and the environment are so inti-
mately linked and where large savings can be
realized. This would include developing and
promoting more efficient cook stoves;


improving kilns, boilers and other equipment
using traditional fuels; developing village
woodlots, on-farm tree growing and other
agro-forestry techniques. The U.S. also has
much to offer developing countries in improv-
ing their analytical and planning techniques
for low-cost energy programs and introduc-
ing renewable sources where practical.
Developing countries will need large
amounts of energy for industrialization, agri-
cultural development, and residential use by
rapidly growing populations. But if they are to
use energy at the rate of the industrialized
countries, five times the present global use
would be required. Clearly, the planet's eco-
system cannot sustain an increase of this
magnitude. In the decade ahead, therefore, all
energy programs, not just those in Third
World countries, should adhere to sound
principles.
Energy issues will become more urgent in
the 1990s. The U.S. should continue its lead-
ership in promoting sustainable energy strat-
egies and programs within the multilateral
agencies. We must avoid treating energy
issues as a fad linked only to the prices OPEC
is able or not able to set for oil. For Third
World countries as for the U.S., the issue is far
more significant and requires long-term, con-
sistent approaches.


Urban Development

In the past, U.S. programs in developing
countries have largely ignored urban issues.
In the decade ahead we urge attention and
cooperation to promote growth, lessen pov-
erty, and to seek mutual gain.
We cannot stop the growth of Third
World cities. Eighty-five percent of the Third
World's population growth in the 1990s will
be in urban areas. Although there can be
many positive benefits to orderly urban
growth, the world's health and environmental

















problems will increasingly exist in cities.
Rather than working to retard urban growth,
we should help shape policies to maximize
the economic contributions cities make, to
maximize their residents' well-being, and to
minimize the impact of the concomitants of
urbanization such as air and water pollution.
We should encourage job creation as a cen-
tral objective of urban policy. The urban peo-
ple of the Third World are and will be our best
customers. Thus, we have a stake in their
prosperity.



Percent of population in urban areas,
1950-2000

Percent
80


1950 1960 1970 1980 1990 2000
Source: Data compiled and projected by The Futures Group from UN and
World Bank sources.


International financial resources will be
needed, particularly to respond to massive
urban infrastructure needs. There is a signi-
ficant opportunity for new housing to be built
through private initiatives. International
donors can help by drawing upon their com-
parative advantages in urban policy, assisting
in financial and management analyses, and
training those who will set the courses for all
these areas of concern.


Working with others, the U.S. should
play its part. Initially we should be cautious as
we build linkages with sources of U.S. exper-
tise, promote policy research, organize dia-
logues with Third World authorities, and help
with policy development. Our contribution to
urban development must be tactical and should
not contemplate large investments; but it also
should be far more active than at present.
We see mutual gain resulting from this
sector. Those working on these programs
should learn how Third World experiences
may be relevant to the U.S. Comparative
urban research and training institutions could
assist in these efforts.


* APPROACHES TO THESE
SUBSTANTIVE AREAS

What approaches should be followed in
addressing these four substantive themes?
We believe that the United States can help
most by drawing on our national strengths
and our comparative advantages in the fol-
lowing crosscutting activities:
M Human Resource Development
Science and Technology
Policy and Institutional Development
Mobilizing Diverse Energies for
Development
In each, there are strong Third World
interests where our talents can complement
local resources. For the most part, these cut
across all of the substantive areas.


Human Resource Development

Human resource development applies to
each of the four substantive areas. People are
the bottom line, both as contributors and
recipients of any successful development
strategy. Raising general education levels and
expanding the number and diversity of spe-
cialists and trained people is central to the


E ighty-five percent of
the Third World's
population growth in the

1990s will be in urban

areas. s























People are the bottom
line, both as contributors

and recipients of any

successful development
strategy.
















outcome of a wide range of development
objectives. More broadly, education lies at the
base of fostering participation and innovation
in society. The degree to which development
programs have effectively mobilized and used
trained people goes far to explain success and
failure of development strategies.
To strengthen a nation's human resources
requires three complementary elements. The first
is the commitment to raise general education lev-
els. The core of this commitment is to school-
ing for children. The second is the vocational
and advanced training capacity for adolescents
and young adults, expanding in diversity and
in quantity as the country advances. The third
is the institutional and policy environment capa-
ble of mobilizing and using the nation's talent
productively and equitably.
Most developing countries face major
difficulties in meeting the demand for expand-
ing amounts and types of education and
training. They suffer from shortages of
resources and lack of sound policies. For the
United States, the pioneer both of high quality
public higher education and of an uncompro-
mising commitment to universal access to
schooling, education is a natural area for
emphasis in programs of cooperation. Yet for
over a decade there has been ambivalence
resulting in uneven support for our educa-
tional assistance programs. During the dec-
ade ahead we should end the ambivalence.
The importance of basic education to
development is not debated. What the U.S.
can do and should do is debated. We believe it
is now time to confirm unambiguously our sup-
port for basic education for all children and for
the school as the basis for any system of such
education. Second, we would emphasize dia-
logue on educational quality, policies, and
institutions. We would stress high-impact
educational inputs. Third, in the poorest
areas, we would emphasize the expansion of
basic social infrastructure, including but not
limited to schools. Finally, we would encour-


age (through advocacy, coordination, or other
means) the efforts of other donors to assist
basic education even where our programs are
not able to assist financially.
Advanced training is a key to practically
every aspect of development. It is essential to
build capacity for advanced training in many
fields in a number of countries. We particu-
larly call for new institution-building efforts in
Africa and, in a few cases, for strengthening
selected institutions in Asia and Latin Amer-
ica through bilateral efforts.
Third World students are obviously
attracted to U.S. schools for advanced train-
ing. A large number seek advanced degrees
here. The vast majority are sponsored pri-
vately or by U.S. or home institutions. Some
get help from the U.S. government; their
number should increase in the 1990s. But
Third World institutions must also be
strengthened so that, in the future, these
countries will depend less on foreign higher
education. The U.S. has a great deal to gain
from innovative and mature cooperation in higher
education and should find ways to encourage it.
Finally, we see the building of manage-
ment capacities as an important component
of a human resource development strategy in
the 1990s. Each of the numerous groups of
experts we consulted as part of this project
said that better management was a key way
to improve development prospects. In each of
our four recommended substantive areas, better
management capacities will be crucially impor-
tant. Virtually everywhere good managers are
needed to provide general administration,
better analysis of policy and finance, and sup-
port for rapid change. This is true in both pri-
vate and public sectors. In some instances,
particularly in poorer countries, we should
help to establish institutions to manage key
development functions.
We have strong training and technical
assistance resources to improve management
in the Third World. Increasingly these Ameri-
can strengths should operate as peer sup-
ports to Third World managers through
networking and long-term linkages.


orthe United
States...education is a
natural area for emphasis
in programs of
cooperation. m
















Science and Technology

The science and technology (S&T) gap
between the richer countries and the Third
World accounts for a substantial share of the
income gap. The Third World, with over two-
thirds of the world's population, has a mere
13 percent of its scientists. This limits Third
World ability to create wealth. S&T will
undoubtedly grow as a factor in future U.S.
cooperation with the Third World. In the four
areas identified, S&T is essential to progress.
But S&T also requires separate discussion
because policy questions surrounding it can
be lost if it is merely seen as a part of every-
thing else.
What does S&T involve? Most see S&T in
terms of physical and biological sciences and
regard the breakthroughs provided by the
Green Revolution and new vaccines as typi-
cal. But the contribution of S&T has been
much broader, is generally incremental, not
spectacular, and involves many different
fields. The social sciences should also play a
role by helping to develop strategies that
introduce new technology, assess barriers to
change, and measure impact on people.
The U.S. has major public and private sec-
tor strengths in S&T that Third World nations
recognize and frequently desire. These cover a
wide range of fields. Biotechnology in its vari-
ous forms now offers much promise. The rap-
idly growing areas of informatics and
communications are central to many devel-
opment tasks and will certainly contribute in
the 1990s. U.S. bilateral programs should tie
U.S. strengths to Third World opportunities and
needs.
Third World countries need to mobilize
and enhance S&T around key national prob-
lems; and they need to create or improve
national policies in ways that productively
link S&T knowledge to development needs.
Some should develop better means of foster-
ing public and private cooperation to encour-
age applications of S&T to growth.
Furthermore, Third World scientists, as all


others, must participate in larger S&T net-
works to avoid isolation.
The United States can help with some of
these tasks through traditional modes of
assistance and cooperation. They will vary
from one situation to another and will require
action well beyond the aid agency. For most
developing countries the process will require
more than short-term consultations and
should also include collaborative research
and application of findings. We see a number
of U.S. government agencies involved in the
process. The private sector can also play a
productive role. Balancing development and
commercial interests will require sensitive
management. Increasingly, we see the need
for new mechanisms such as binational foun-
dations, agreements, and other special link-
ages to foster long-term relationships. The
U.S. has much to draw upon from experience
with creating such linkages, for example
those that exist in India and in Israel and the
relationships being discussed in Thailand.
For the poorest countries, we should
help increase capacity through training and
institution building. But often these countries
will have to be shown how to use S&T more
efficiently and practically. In the more
advanced developing countries, S&T has pro-
gressed to the point where we can pursue
mutual gains, working together on problems
such as global ecology, alternate energy tech-
nologies, diseases, agricultural research, as
well as industrial technology issues.


Policy and Institutional
Development

The adjustment crisis of the 1980s will
continue into the 1990s for most developing
countries. With support from donors, many
countries undertook economic policy reforms
aimed at improving the setting for develop-
ment at the macro and sectoral levels. In the
1990s, we must build upon the lessons, both
positive and negative, of these experiences.


The Third World, with
over two-thirds of the
world's population, has a
mere 13 percent of its
scientists. m













Third World countries
need to mobilize and
enhance S&T around key
national problems. m




















A general lesson is
that only if countries wish
to undertake policy
changes will they do so. m







A mericans can foster
our own proven value of
pluralism with confidence
that it is harmonious with
the aspirations of people in
most of the world. m






















24


The United States should continue to
engage in active policy discussions with a broad
range of governmental and private sector leaders
in the Third World. These activities need to
recognize the lessons of thirty years of policy-
based assistance. There have been both suc-
cesses and notable failures. A general lesson
is that only if countries wish to undertake pol-
icy changes will they do so.
A second lesson is that only where institu-
tional growth has been commensurate with policy
changes have these changes been sustainable.
Successful U.S.-Third World policy dialogue
has occurred where the U.S. has put substan-
tial manpower resources into understanding
the economic, social, and political complex-
ities of the local situation. Often policy
changes are not adopted because sensitive
and factually backed options are not known.
This is where the U.S. can contribute well in
areas in which it possesses and can mobilize
real expertise.
The U.S. should emphasize its support
of policy-relevant research in developing
countries. It should support the strengthening
of autonomous policy research centers and
encourage governments to use the technical
expertise resident in such centers. Experience
has shown that success in policy dialogue
depends upon shared analytic capacity on
both sides of the dialogue.
Policy and institutional development
provides an approach that varies from one
country to another and is an important ele-
ment in each of the four substantive themes.
The U.S. should also play a role in discussions of
macro policy issues. But in such situations, the
U.S. should be joined by other donors and by
multilateral agencies, in consideration of politi-
cal sensitivity and to strengthen credibility.


Mobilizing Diverse Energies
for Development

The most fundamental principles
involved in our own national life the crea-
tion of a land with liberty and justice for all -


also turn out to be sound economics. Over the
longer term, nations that encourage freedom
and open opportunities for economic partici-
pation (coupled with rules that assure that
private actions are socially responsible) pro-
gress further than those that restrict participa-
tion. These nations also create politically
more sustainable growth. Thus, Americans
can foster our own proven value of pluralism
with confidence that it is harmonious with the
aspirations of people in most of the world.
Indeed, the world is undergoing a liberation of
the human spirit, and we must be sure that, in
the words of some, we are on the right side of
history and are viewed as such. The program
of development cooperation can contribute to
this broad end by sensitively employing
means that will engage and strengthen vari-
ous groups in society.
Mobilizing diverse energies means fostering
decentralized development and selecting local ini-
tiatives (local government, private groups, indi-
viduals) over central initiatives. More pointedly,
we mean the expansion of the role and partic-
ipation of a number of organizations and seg-
ments of society in addition to government
agencies. We place special emphasis on four
categories: the private sector, nongovern-
mental organizations, women in develop-
ment, and human rights.

Private Sector
In emphasizing here the role of the pri-
vate sector, we do not imply that other points
of emphasis belong to the public sector.
Indeed, there are strong private sector roles
within each of the four substantive themes we
have emphasized. But here we point to the
policies, rules, and financing necessary for a
robust private sector per se.
American foreign economic cooperation
has long stressed the role of the private sector.
Often we emphasized using the U.S. govern-
ment to promote overseas investment by U.S.
firms. More recently this has changed. We
















correctly shifted to enhancing the prospects
for domestic enterprise and strengthening the
market system.
Our bilateral economic cooperation should
focus particularly on helping to establish fair
rules of the game for domestic and international
investment. This has far more to do with the
flow of foreign investment than do specific
subsidies and incentives. Most often Ameri-
can firms can do well if local enterprises are
treated well, with reasonable rules of entry
and fair settlement of disputes. Barriers to
new formal and informal enterprises must be
reduced, and access to easier credit, espe-
cially for small enterprises, must be provided.
This should be a major focus of our policy
dialogue. The U.S. can also assist in organiz-
ing capital markets and in promoting the role
of financial intermediaries within Third World
countries.
To help in this overall process, we would
recommend that three institutions expand
significantly: The International Finance Cor-
poration, in funds; Multilateral Investment
Guarantee Authority, to full international
membership; and Overseas Private Invest-
ment Corporation programs, to serve a
broader range of firms, particularly in the mid
to smaller size, which often need help.
Fair rules of the game are also needed
internationally. The U.S. should promote the
establishment of agreed-upon rules for
investment under either the General Agree-
ment on Tariffs and Trade (GATT) or the
Organisation for Economic Co-operation and
Development (OECD). The U.S. also has
much to gain under bilateral and multilateral
trade regimes.

Nongovernmental Organizations
(NGOs) in Development
American NGOs receive from private
contributions upwards of $1.5 billion per year
(some 60 percent of all private contributions
among the OECD nations) and manage an
additional $1-1.2 billion/year in U.S. govern-
ment funds. Collectively, and in several cases


individually, NGOs are significant develop-
ment actors. In addition, the U.S. has directly
fostered Third World NGOs through funding
from USAID (often via American NGOs), the
Inter-American Foundation, and the African
Development Foundation.
It should be a more prominent part of
U.S. policy to foster these local NGO centers
of program initiative. In the years ahead, we
should help American NGOs both to strengthen
their links with local NGOs and to foster the
development of local NGOs. So too, official U.S.
programs should more fully assess the les-
sons of the NGO community to help shape
future U.S. programs and policies.

Women in Development
It is now widely acknowledged that tra-
ditional development assistance programs
have overlooked and insufficiently supported
women's productive roles. We need to under-
stand better the constraints on women's pro-
ductivity and the ways to relieve these
constraints. Analysis is needed that is sensi-
tive to the sexual division of labor and
differences in men's and women's access to
and control over resources.
Viewed through the lens of such gender
analysis, the development problems dis-
cussed in this report take on a new reality.
Women are central in each of the substantive
themes discussed above. For example, in term
of health and population, women are the key
actors in health education and practices
within the family and key to effective family
planning programs. In terms of hunger and
food, women produce, process, and prepare
much of the world's food. In terms of eco-
nomic growth, women's roles in production
and marketing are under-appreciated and
could expand greatly if credit and other serv-
ices were assured. In terms of environment,
women are primarily responsible for the col-
lection of fuel, fodder, and water and are,
therefore, much involved in prevention of
environmental degradation.


Barriers to new formal

and informal enterprises
must be reduced, and
access to easier credit,
especially for small
enterprises, must be
provided. m






INOs are significant
development actors. m





















M obilizing the
energies of women
becomes an important
means of attacking a
number of basic
constraints to
development. 0













Too often development
has not benefited
minorities within
developing countries. E


As we develop strategies within each
substantive area, we should take these basic
facts about women seriously into account. In
the decade ahead, rhetoric and token projects
will not do. Whenever possible, we must shift
to stronger action. Enhancing the participa-
tion of women in technical assistance pro-
grams must become one of the starting points
in development, not a minor afterthought.
Mobilizing the energies of women becomes
an important means of attacking a number of
basic constraints to development.
What is required is not only strong commit-
ment, but an effective strategy that acknowledges
gender differences and is based on principles of
equity. Such a strategy depends upon
sufficient resources and the authority to
assure the development of analytic tools sen-
sitive to gender differences; the training of
staff in the use of these tools in planning,
implementation and evaluation; and the
introduction of incentives to ensure their
effective use.

Human Rights
For over a decade the U.S. has fostered
human rights as a matter of national policy.
This is not a new concern, but one that calls
for continued attention and support, espe-
cially in view of positive trends observable in
much of the world. Too often development
has not benefited minorities within develop-
ing countries.
In South Africa, USAID is providing sup-
port to empower black organizations in a
range of self-help types of activities. In other
selective situations, we could organize a posi-
tive approach to help peoples and groups, cur-
rently discriminated against because of race,
religion, or gender, become more directly involved
in development activity.


In these four areas the private sector,
NGOs, women in development, and human
rights we see the mobilization of diverse
energies as important to attaining the goals
we endorse. Moreover, they provide insur-
ance that this country has multiple links with
the Third World that can survive the vagaries
of short-term political problems. In both style
and substance U.S. development cooperation
should promote human rights and encourage
groups and individuals to make use of oppor-
tunities.
We recognize the sensitivity of dealing
with these issues bilaterally, and that doing so
may be perceived as strengthening alterna-
tives to existing governments or elites; never-
theless, we believe the U.S. should not ignore
bilateral programs. They will require careful
thought, sensitive dialogue, and long-term
planning. It appears as though there will be
increasing opportunities to encourage this
evolution in the next decade.
In summary, we believe that the four sub-
stantive programs and suggested crosscutting
approaches will serve well the three goals of
broad-based economic growth, the attack on
poverty, and sustaining the environment. But are
they sufficient to attain the goals? They are not.
The efforts of Third World countries themselves
will be the key. We should seek to help their efforts
become increasingly effective, not to impose our
own ways. Genuine cooperation for development
will be important; and coordination with others,
especially with multilateral banks and organiza-
tions, will be essential if we are to meet these
goals.








JI ow Should U.S. Development Cooperation Be

I Carried Out?


Administrative form should follow sub-
stance and function. A combination of new
functions and the continued assault on old
problems calls for new administrative forms
and styles to engender new relationships and
coordinate complex programs. In general, we
should carry out relationships with the Third
World in ways that reflect the transition from
an aid relationship to one of cooperation for
mutual gain.


* REGIONAL BALANCE

Bilateral programs designed to meet
national circumstances and interests should
continue to be the building blocks for the U.S.
development program in the decade ahead.
However, both U.S. interests and Third World
needs call for distinctly regional approaches
and differentiated commitments. These
regional variations should be noted and clar-
ified in program planning; they are treated
only summarily in this report.



Regional allocation of U.S. total bilateral
aid, 1977-86
Includes military aid, economic support funds, food aid,
and development assistance.

Percent
100

\sia .Latin America
60
-d Africa


20
40 .... |,. ,e.,F,:- .




77 78 79 80 81 82 83 84 85 86
Fiscal Year
Source: Trends in Foreign Aid, 1977-86, Study prepared by the Foreign Affairs
and National Defense Division. Congressional Research Service, for the Select
Committee on Hunger, U.S. House of Representatives. November 1986. p 13.


Regional allocation of U.S. bilateral
development aid, 1977-86
Includes food aid and development assistance.

Percent
100
I





20 Africa
Middle East,
77 78 79 80 81 82 83 84 85 86
Fiscal Year
Source: Trends in Foreign Aid, 1977-86, op. cit.. p. 14.


We have a great deal at stake in our ties
with Latin America: large economic interests,
security concerns, and the disruptions to our
own society that result from poverty at our
doorstep. The U.S. must adopt three broad
priorities in this region: help relieve debt bur-
dens so that growth can be accelerated; help
reconstruct postwar Central America; and
assure an effective Caribbean Basin Initiative.
Our policies and actions on debt and trade
and our pursuit of avenues of cooperation for
mutual benefit will be far more important
than bilateral concessional assistance. Aid
will be useful in some situations but is likely
to be largely wasted without supporting
finance and trade policies.
We have discussed Africa's special needs
and see a large role here for development
assistance, a much different balance of activi-
ties than in the case of Latin America or Asia.
South Asia presents a complex and bifur-
cated picture; it is at once the area in which
the largest number of impoverished people
live, and in which there is a large and expand-
ing middle class eagerly seeking opportuni-
ties for mutual gain. Generally, South Asia is


U S. interests and

Third World needs call for

distinctly regional

approaches and

differentiated
commitments. M




















T way we carry out
programs in Third World
countries can be as
important as the substance
itself. 0











The U.S. program must
make up in quality what it
has already lost in
quantity. m


institutionally capable of putting large
amounts of foreign resources to good use. We
should respond with programs that address
both South Asia's poverty and its trade and
investment opportunities. A combination of
aid and programs of mutual gain are in order
with variation among countries.
We have practically no programs in
India. Here the nonfood aid level is down to
about $24 million/year. The net flow of aid
resources is negative due to India's repay-
ments of past aid loans. This is inappropriate.
India is a large democratic country with mas-
sive poverty. Yet it has the world's tenth larg-
est industrial base, a large science and
technology manpower pool, and a middle
class rivaling major European countries in
size. There is clearly room for innovative pro-
gramming including cooperation for mutual
gain.
East Asia also offers complexities for the
U.S. Investment, trade, and other activities for
mutual benefit should be the order of the day
with the Four Tigers and, increasingly, Thai-
land. Long-term development cooperation
efforts will be appropriate for the Philippines
and Indonesia.
For the Middle East, existing obligations
must stand political tests, but these obliga-
tions should not be exempt from economic-
effectiveness tests as well. It would be prefer-
able to find ways of expressing our deep com-
mitment to the area so that the proportion of
bilateral development aid going to the region,
virtually half of the total U.S. aid appropria-
tion, is reduced or treated in a manner that
will more accurately present our overall
development fund level.


* MODE AND STYLE OF
OPERATION

The mode and style of U.S. development
cooperation must reflect changed global circum-
stances, defined goals for the 1990s, and individ-
ual country situations. The way we carry out


programs in Third World countries can be as
important as the substance itself. Our policies
and programs in the 1990s should build on
the lessons we have learned in sensitive situ-
ations careful attention to collaborative
style, consultation, and emphasis on shared
gains.
We have already referred to the need to
base our programs for the 1990s on long-
term relations and partnerships. The empha-
sis on capacity building within the developing
world calls for long-term vision and plans.
Long-term commitments are expressed
through institutional linkages, joint planning
and partnerships, and some insulation from
the ups and downs of political relations. If
authority existed to carry over funds from one
year to another, the program could avoid the
year end crush of activity that now prevails
and could gear to longer-term programming.
Development cooperation programs in the
1990s must emphasize high quality. Many of
the new relationships will involve people on
both sides with expert knowledge of
advanced technology. The tasks will not be
easy. We must draw our very best scientists,
agriculturalists, environmentalists, and social
and economic analysts into the challenge.
The U.S. program must provide vigorous
evaluation, intensive staff training, and
streamlined management as it proceeds.
Comparatively small in size compared to past
years, it must make up in quality what it has
already lost in quantity.
Some development cooperation pro-
grams will be in areas where risks of failure
exist, such as in aspects of environmental
research and programming where we do not
always understand the forces at work. We are
fortunate that we have much experience to
draw from, but we cannot expect all pro-
grams or experiments to succeed entirely. If
this fact were acknowledged more widely, we
would find more candor generally and more
willingness to be innovative.

















As another aspect of the mode for the
1990s, development cooperation should work
increasingly through cooperating organiza-
tions and institutions. The balance of effort
should rest with intermediate organizations.
The U.S. development agency itself should
emphasize analysis and policy. The intermedi-
aries should provide talent needed within var-
ious sectors for the long term. They should be
vehicles for planning and carrying out
agreed-upon broad programs of cooperation.
They themselves may link with parallel insti-
tutions in other developed countries. But
above all, we would expect them to know
how to attract high quality staff, directly or
through contracts, and operate with sensitiv-
ity in Third World countries. There are a
number of examples or possible models
already in place the Board on Science and
Technology for International Development
(BOSTID) of the National Research Council in
the case of science and technology, the Con-
sultative Group for International Agricultural
Research (CGIAR), the Population Council,
and university general-purpose international
consortia.
Such intermediate organizations would
demonstrate in practice the pluralistic
approach we propose. The medium itself
becomes a message to countries abroad as
they themselves move in the direction of plu-
ralism. U.S. policy should encourage growth
of intermediaries within countries abroad,
especially units that can generate ideas and
operate as nongovernmental organizations,
independent of direct government control.
Such intermediaries provide an excellent
means of encouraging pluralism. We must
take special steps to assure a long-term but
light hand in administering this kind of pro-
gram.
Our policies and programs abroad
should encourage the growth of local founda-
tions and binational and multinational com-
missions. Some might well be set up on a
jointly sponsored basis during the closing
years of the more traditional development
assistance activity. In this way we might per-


petuate strong mutually beneficial linkages
between U.S. and local institutions. In gen-
eral, we should encourage exchanges in edu-
cational and scientific fields, including those
in which we learn from persons abroad as
much as they learn from us.
We should strengthen and expand the
scope of the Peace Corps as a vehicle for
encouraging cooperation on development
matters, and as a way for Americans to expe-
rience life in a broad range of countries, even
in some where we may not have development
assistance programs. Other U.S. agencies can
also help plan and execute programs of coop-
eration.
Finally, as we work with relatively
advanced developing countries in new rela-
tionships, we should involve them more
actively in development activities with the
less advanced nations. In the near future, we
should consider sponsoring some of them,
such as South Korea, to membership in the
Organization for Economic Cooperation and
Development and its Development Assistance
Committee. Working together as equals, we
could sharpen our means of cooperation and
coordinate our contributions to the develop-
ment process.


* ORGANIZATIONAL
CONSIDERATIONS

A temporary agency, the U.S. Agency for
International Development (USAID), has
managed the U.S. development assistance
program since 1961. Its predecessors go back,
by some definitions, to as early as 1946.
USAID has served the nation and the develop-
ment process well. It has pioneered assistance
programming, advanced new technologies,
helped to set priorities, and, in some cases,
provided a model for other donors. However,
as we move from an era of aid to a period stress-
ing cooperation for development and mutual
benefit, we need to change.


O ur policies and

programs abroad should

encourage the growth of

local foundations and

binational and
multinational
commissions. m



















T e Development
Cooperation Agency
should become known for
the quality of its ideas and
expert analysis of
development issues. u













It is time to consider
creating a new
foundation-like entity, one
which would promote
research on issues and
technologies of broad
consequence to the U.S.
and to developing
countries. m


It is timely and appropriate now to
rename the agency and to redesign some
aspects of its structure in order to say to all, at
home and abroad, that different goals and
operational style now prevail. Development
Cooperation Agency would be a good new name.
Other kinds of changes are more complicated.
But they can be achieved without dramatic
time-consuming moves to create a new
agency in place of the present USAID or to
separate the agency from the Department of
State.
The Development Cooperation Agency
(DCA) should operate through a policy center
plus regional counterparts to the State
Department's regional bureaus. It would take
full advantage of advanced communications
technology to reduce field vs. head office fric-
tion and to increase the role of the Washing-
ton headquarters as a policy setting and
backstopping entity. Through enhanced use
of intermediate institutions and other means,
we would expect the number of long-term
personnel based in Washington to decline.
The Development Cooperation Agency
must strengthen its ability to do economic and
macropolicy analysis. As a result of this
change, it should become known for the qual-
ity of its ideas and expert analysis of develop-
ment issues. This is essential if it is to play a
central role in coordinating Washington
agencies, influencing policies in multilateral
agencies, and developing policy dialogue and
bilateral programs. It should spend more time
on the larger issues and strategies of pro-
gram, less on budget and management.
The administrator of the agency should
have a single high-level advisory council that
would integrate key sectors of interest, now often
operating in isolation and to the detriment of
good policy and broader program advice. The
council should draw top people from the pri-
vate sector, academia, the NGOs, and the
environmental community. The aim would be
to build bridges between key sectors that
must work together more successfully. There


would be ample room for effective subgroups
at the operational and professional level
under the umbrella of such a council.
The future of USAID country missions
needs review as development programs shift to
mutual benefit and cooperation. Such review
should take into consideration the changed
style and function of the program, the costs of
maintaining personnel abroad, the implica-
tions of modern communications technology,
potential expansion of regional missions,
greater use of local expert talent, and an
expanding role for intermediate agencies.
Field missions have been an important and
distinctive aspect of U.S. programs in the
past; their role in the 1990s and onward
should be reviewed with these past contribu-
tions in mind.
It is time to consider creating a new
foundation-like entity, one that would pro-
mote research on issues and technologies of
broad consequence to the U.S. and to devel-
oping countries. This foundation would fund
the U.S. share of multicountry, jointly planned
lines of research. Although it would work eas-
ily with the more advanced nations, it would
not be limited to them. Its use of the best in
science and technology would apply across
the range of developing countries.
The foundation could be a new semiautono-
mous unit within the renamed and changed
Development Cooperation Agency, or it could
operate parallel to DCA. In either case it would
provide easier access to U.S. talent and a
healthy balance to the country and regional
programming approach. It would be strongly
allied with those in the DCA involved in plan-
ning and managing programs of development
cooperation.
There are good reasons to separate out
the research function in this way. They are the
same that industry uses when it creates semi-
autonomous research wings. Domestically,
the U.S. government has built up separate
research units such as the National Science
Foundation and the National Institutes of
Health. They follow different operating rules
and priorities than line or action agencies. In
















our development work, we need some means
of sheltering research from operational pres-
sures. Research is an extremely important
function and at the very core of some pro-
grams across the entire agency. One model
on the international scene is the widely
respected International Development Re-
search Centre in Canada.


* THE COORDINATION
IMPERATIVE

Whatever changes may occur in the
organization and structure of the develop-
ment cooperation agency in Washington and
in the field, we must improve coordination,
both abroad and at home.


Coordination in the Field

There are the classic problems of coordi-
nation among donors in countries where the
assistance mode prevails. It is not unusual for
ten or fifteen bilateral programs and those of
numerous other organizations and multila-
teral agencies to operate in one country. With
an increasing number of participants in the
process, problems arise. Everyone would
gain from cost-efficient coordination.
Ideally, the developing country itself will
coordinate these efforts. We should consider
it part of the job to build management capaci-
ties to handle coordination. In some countries a
formal coordinating council might do this,
headed and chaired by a high-level local official.
In this way, participating donors can more
easily justify and balance their individual
efforts. Peer pressure could stimulate a higher
quality of work. One could make a good case
for multilateral agencies such as the World
Bank or United Nations Development Pro-
gram (UNDP) to be first among equals in any
such coordinating council.


Whatever the arrangement, the U.S. must
have a clearly delineated active agenda. It must
know what it wants to accomplish within the
needs that have been defined and in which it
has a comparative advantage. In specific
fields, the U.S. should agree to provide leader-
ship among donors; indeed, it will be
expected to do so. For example, in certain
areas of environmental concern, in science
and technology, agriculture, advanced train-
ing, and in some aspects of management
training, the U.S. might well be asked to take
the lead.
In many developing countries, the U.S.
contribution has diminished when compared
to other bilateral programs and, certainly,
with respect to the World Bank. Therefore, the
U.S. is not in a position to impose coordina-
tion as it may have been in the past, but must
consciously work with others. In more
advanced countries where cooperation for
mutual benefit is the rule, coordination is not
an issue.


Coordination within the U.S.
Government

Coordination among U.S. government
agencies is also a serious task. The issues in
development cooperation are becoming far
more complex and are of greater importance
to the U.S. Global issues, such as the environ-
ment, must be addressed in the next decade.
Our interests and effectiveness are not well
served when trade policies operate at cross
purposes from development programs and
when goals to increase agricultural produc-
tivity are countered by subsidized food sales.
Furthermore, we need expanded coordination
because of the involvement of new domestic
actors, such as the Environmental Protection
Agency, the Food and Drug Administration,
and various other agencies.
Some have suggested that the Interna-
tional Development Cooperation Administra-
tion (IDCA) of the late 1970s should be


Ideally, the developing
country itself will
coordinate these efforts. .
















revitalized to achieve policy and budget coor-
dination. Others believe its design as an
administrative superagency was flawed and
that some new form of coordinating structure
or pattern would work more effectively.
Because of the many actors on matters per-
taining to developing countries, the State
Department must provide foreign policy guid-
ance; however, the actual coordination of pol-
icy formation and implementation would be
best managed through White House leader-
ship directly, not through a revitalized IDCA.
In view of the importance and complex-
ity of development issues, some form of a
council for international development policies
would be appropriate and timely. In such an
effort the White House would appoint the
chairperson; members would be the heads of
the critical agencies involved in trade, finance,
development cooperation, agricultural sales,
and so on. We would expect the agency prin-
cipally devoted to development, the redefined
Development Cooperation Agency, to be very
active in the council to assure a strong devel-
opment voice. The Office of Management and
Budget would also be important in this proc-
ess to assure that funding recommendations
would follow critical decisions made by the
council.
The White House must lead such a council
because only at that level can overarching
national interests be articulated well, providing
both a single voice and the strength to follow
through. But to be effective the council must
have clear policies and, of critical importance,
the active interest of the President. Without
such interest, we can expect a continuation of
inadequate coordination.
More effective coordination between the
Executive Branch and the Congress is also
needed. Within Congress, which plays a criti-
cally important role in development assist-
ance policy, the interest in trade, agriculture,
foreign aid, debt, and science and technology
are spread over a number of committees.


House and Senate leaders should work out
greater cooperation between committee
chairs to coordinate policy guidance and
oversight on these interlinked matters.


An Agenda for Domestic
Coordination

The U.S. greatly influences Third World
development prospects. The greater impact
does not come from government programs of
development assistance. Rather it comes from
non-aid policies trade, finance, interest
rates, investment rules, patent rulings. We
must, therefore, see these as having both
domestic and global implications and conse-
quent responsibilities. This is not the place to
analyze and recommend what those policies
should be. But it is appropriate to note the
connection and to argue for greater coordina-
tion among policies. Although they are seen
as domestic, non-aid policies are also inter-
national in their implications.
The U.S. agency charged with the main
responsibilities for development should be in a
position to command respect in high-level dis-
cussions of such issues. Policymakers should at
least know when a proposed domestic action
will undermine a Third World development
policy being pursued by the U.S. so that the
issues can be weighed within a broadened
perspective. Interest rates are a clear example
of such an issue. No longer of concern only to
homeowners and business managers holding
variable rate mortgages, fluctuating interest
rates also affect Third World nations in debt
to consortia led by our banks. Federal Reserve
Bank authorities are clearly moving to a more
international view of domestic interest-rate
policy, and this should be encouraged.
Third World nations, including some of
the poorest, have increasingly argued that
improved trade access to U.S. markets would
permit them to forego development aid. The
American market is the prime goal for many
Third World nations in search of hard cur-


I n view of the
importance and
complexity of development
issues, some form of a
council for international
development policies
would be appropriate and
timely. a
















rency. It is important in the 1990s that U.S.
trade negotiators listen to those who hold
development policy responsibilities. Many
Third World nations depend on U.S. leader-
ship to maintain an open international trad-
ing system.
We have singled out only a few among
many domestic policies that strongly affect
development progress. In an increasingly
interdependent world it is harder to identify
purely domestic matters. More and more the
ripple effects of our domestic policies roll
overseas. We are judged by our actions,
rather than by the rhetoric we direct to other
shores. The Voice of America is not a substitute
for America's voice.


* MULTILATERAL AND
BILATERAL BALANCE

The need for coordination is one of
many reasons the U.S. must continue to play
an active and supportive role in the multila-
teral agencies devoted to international devel-
opment cooperation. Given the financial
challenges facing developing countries, U.S.
interests and those of the Third World are
served well by a strong International Mone-
tary Fund and World Bank. These institutions
should continue to finance stabilization and
adjustment programs in the Third World.
These programs must be growth oriented.
Wherever possible, they should insulate the
most vulnerable groups from bearing the bur-
den of adjustment.
Regional development banks (RDBs) are
a natural outgrowth of the increasing multi-
polarity of the international system. The U.S.
should continue to support the enhancement
of both the financial scope and creativity of
these institutions and their institutional
capacities. The RDBs need to maintain a bal-
ance between using Western financial
resources to expand their operational capaci-
ties, and maintaining their character as
regional organizations.


Key UN agencies, such as the World
Health Organization, the Food and Agricul-
tural Organization, International Fund for
Agricultural Development, the United Nations
Development Program, and the United
Nations Children's Fund, also deserve
expanded American support. The increas-
ingly global nature of economic and environ-
mental problems will require effective
multilateral organizations and cooperative
attitudes by sovereign governments.
The multilateral system, in spite of its
difficulties, remains a major resource in inter-
national development cooperation. A strong
multilateral system will not be subject to the
U.S. dominance that may have existed in the
past. But it is an essential component of a
global assault on serious issues, including
development, that affect all of us.
In the mix of bilateral and multilateral
efforts, we would stress our comparative advan-
tages. Thus, in our bilateral endeavors we would
avoid doing some things we currently do not do
well. In our view, U.S. bilateral cooperation
would only rarely initiate high-cost activities
such as large infrastructure projects or the
creation and financing of large social and eco-
nomic projects and programs. We should
also, in general, avoid taking the lead in
attempting to leverage changes in macroeco-
nomic policies, although continued involve-
ment in dialogues on these issues is
appropriate. The special circumstances in
sub-Saharan Africa may lead to exceptions to
these guidelines.
One key to an effective U.S. role in multi-
lateral organizations in the 1990s is upgrad-
ing the coordination system in Washington.
Another is increasing the status within the
personnel system for U.S. government
employees on loan or assignment to multila-
teral agencies. The positions should attract
top-flight people. Americans in these organi-
zations should get full credit, and their service
should contribute importantly to their career
advancement.


U .S. interests and
those of the Third World
are served well by a strong
International Monetary
Fund and World Bank. m


















U .S. bilateral
cooperation would only
rarely initiate...large
infrastructure projects
or...financing of large
social and economic
projects and programs. m


















U S. food aid supplies
60 percent of the world's
total. m


While supporting a strong multilateral
system, the U.S. cannot limit its development
cooperation activities to the multilateral
approach, as some have urged. We need a
strong bilateral program to assure our inter-
ests and to gain access to top expertise and
capacity within the U.S. that cannot be fully
harnessed in the multilateral system. Both
types of programs serve our interests as we
move toward our three broad goals.


* REFORM OF FOOD AID

For over thirty years the U.S. has made
available our agricultural commodities
through food aid. Now amounting to a little
over $1 billion per year, these programs have
a complexity of their own with purposes
ranging from relief to export subsidy.
Although comprising less than 2 percent of
our food exports, this food aid supplies 60
percent of the world's total.
We have learned how to target food aid
to have more educational and nutritional
impact, but a number of basic reforms would
make food aid more effective.
De-emphasize the allocation of food
aid to keep up dollar levels of foreign
aid to selected countries; and
emphasize more the targeting of food
aid to countries where there is a
genuine need for food imports on a
concessional basis.
5 Increase repayments in local
currency, rather than foreign
exchange, for food aid provided
under loan agreements.
P Include policy dialogue toward
attaining food security in large
food-aid programs.
Use food aid to bolster local agencies,
such as NGOs, as a normal process.


If predictions for sub-Saharan Africa
turn out to be true, there will be very large
demands for food aid for that region. We will
need ongoing mechanisms to assure the
institutional and policy environment for an
effective program there. The increasing
unpredictability of weather patterns might
well create larger food-aid needs elsewhere,
too, in the 1990s.


* FINANCIAL IMPLICATIONS


Trends in Financial
Contributions

Polling data confirm that Americans
think of themselves as almost uniquely gen-
erous international citizens. That image was
justified at the time of the Marshall Plan
(which at today's prices would represent
about $70 billion a year concentrated in aid to
one continent) and into the 1950s when the
U.S. led in providing resources to the Third
World and when we had an explicit policy
fostering multilateral institutions and the
growth of other bilateral donors. This is no
longer the case today.
By the 1970s the number of other donors
had grown significantly and so had the flow of
private and bank investment. By 1980 private
flows were 50 percent higher than official
flows ($60.9 billion versus $42.1 billion),
reflecting the substantial recycling of OPEC
funds. The 1980s have brought many
changes: private flows have shrunk; official
aid has held steady in absolute terms; and the
growth of other OECD donors has made up
for the declines in OPEC aid. The biggest
change is that Japan is replacing the United
States as the largest donor of official development
assistance (ODA).
In the comparison chosen by Western
donors to gauge their performance, i.e., per-
cent of GNP allocated for official development
assistance, the U.S., which had been first





















Net official development assistance from OECD/DAC countries in 1987


$ Billion
United States
japan
France
Germany
Italy
Netherlands |
United Kingdom
Canada I.. :
Sweden
Norway .89
Denmark "0.86
Belgium _0.69
Australia 10.62
Finland :, -3
Switzerland -,2, .
Austria 0.20
New Zealand 0.10
Ireland 0.05
Total DAC
0 2 4 6
(a) Including DOM-TOM (b) Excluding DOM-TOM


As % of GNP


8 10


Norway
Netherlands
Denmark
Sweden
France
Finland
Belgium
Canada
Germany
Australia
Italy
Japan
Switzerland
New Zealand
United Kingdom
Ireland
United States
Austria
Total DAC


0 0.2 0.4 0.6 0.8 I 1.2


Source: Organisation for Economic Co-operation and Development, Development Assistance Committee. 1988. (Based on preliminary reports from member countries
and subject to modification with later data. Amounts in parentheses have not been officially reported to the OECD by the member country concerned.)


among the donors, now ranks almost last and
is also outpaced by a number of OPEC
donors.
Trends in official U.S. aid are shown in
the accompanying tables: high growth in the
period 1977-85 with military and security
assistance receiving sharp increases and
development assistance (including P.L.-480
food aid and financing of the multilateral
institutions) becoming a smaller part of the
total. In constant dollars, nonsecurity aid
actually declined over the period.
Economic Support Fund (ESF) and mili-
tary aid constitute 60 percent of the total. Of
the total bilateral economic package 49 per-
cent goes to the Middle East (mainly Israel
and Egypt), 7 percent goes to Europe in
exchange for base rights for American forces,
and 6 percent goes to sub-Saharan Africa.


Composition of U.S. foreign aid
appropriations, 1977-86


Percent
100

SMliIlary Aid



L co omic Support Fund

-. Food:Ai'u."

S .-..Development Assistance

77 78 79 80 81 82 83 84 85 86
Fiscal Year
Note that ESF appropriation levels also include other security-related aid
funded within the bilateral economic title of foreign aid appropriations. This
includes amounts provided for peacekeeping operations, antiterrorism
programs, and for humanitarian aid to the Nicaraguan contras.
Source: Trends in Foreign Aid. 1977-86, op. cit., p, 7.


T1L U.S., which had

been first among the

donors, now ranks almost

last and is also outpaced

by a number of OPEC

donors. I


















B budgetary pressures

should not blind us to the

need for development

cooperation or to the

benefits...that are to be

derived from it. m


















Sf proposed new
programs and modes are

effective and the nation

can see progress...it will be

natural and desirable to

provide increased U.S.

funding. m


Composition of U.S. fo
appropriations, 1977, 1
1986

1977

Mil
Development assistance 2,487
Food aid 1,169
Economic support funds 1,735
Military aid 2,022
Total 7,413
Source: Trends in Foreign Aid, 1977-86, op. c




Total U.S. foreign assis
estimated obligations


Official bilateral aid
Development assistance
Food aid
Economic support funds
(security related economic
Sul
Official multilateral aid
Cumulative sul
Military aid

Source: Agency for International Developm
IS89, Main Volume (n.d.. circa March 198



Future U.S. Fina1
Development Coo

In the 1990s the nei
development cooperation e
Private flows are likely
are unlikely to be dire
countries. The United
adjust to its own financi;
its own economic hou
looks like tough times
times at home. But
should not blind us to t


ment cooperation or to the benefits, both to
reign aid the U.S. and the Third World, that are to be
980, 1983, and derived from it.
We believe a scenario that works for the
growth of both the Third World and the U.S.
1980 1983 i986 should be possible. Substantial mutual pro-
gress, not gloom and doom, can occur but
lions of current dollars will depend on statesmanlike actions on trade
3,710 4,302 4,147 issues, a continuing thaw in East-West rela-
886 1,028 1,299 tions, and improved debt management.
2,08 2,9936 6,027 Although the immediate future will
8,661 13,859 15,214 require level financing and sorting out of pri-
orities and opportunities, our goals are
it., p. 8. sufficiently important to our future to justify
increases during the 1990s. It would be foolish
to argue that more resources go into ill-defined
and poorly executed programs. But with sharper
stance for FY 1988, definition of goals and effective programs to meet
them, we would expect to see a higher priority for
development cooperation in the 1990s.
$ Billion % Currently the U.S. with 36 percent of the
GNP of the OECD nations provides only 21
2.4 18 percent of official development assistance.
1.5 1 The U.S., which used to provide as much as 2
help) 3.2 24 percent of its GNP for foreign aid, now pro-
btotal 7.1 53% vides .19 percent of its GNP. The larger West-
1.5 i ern European nations provide an average of
total 8.6 64% .42 percent and several key countries, e.g.,
4.8 36 Italy and Japan, are rapidly increasing their
Total $13.4 100% aid programs. It would be reasonable to con-
lent, Congressional Prsentation FY sider our fair share to be closer to the middle
8), pp. 508-5,. of the major Western donors, as measured by
percent of GNP devoted to official develop-
ment assistance, by the mid-1990s. This
would be an increase of some 80-100 percent
ncing of above current levels.
The reasons to increase our financing, how-
ever, are based not on what others do, but on the
ed for funds to sustain critical importance of meeting the goals we have
effortss will not diminish, suggested. If proposed new programs and
to remain weak and modes are effective and the nation can see
cted to the poorest progress toward economic growth, an impact
States will have to on poverty, and environmental improvement,
al constraints and put it will be natural and desirable to provide
se in order. Thus it increased U.S. funding.
abroad and tough
budgetary pressures
he need for develop-



















Share of official development assistance
by OECD/DAC member countries

1962 $27 billion*






their billion
Members 3%/

1987 $41 billion*

USA 21%

Members of
EEC 46%
Other DAC
F. -. o Members 15%

lapan 18%
'at 1987 prices and exchange rates
Soitrct: Organisation for Economic Co-operation and Development.
Development Assistance Committee, 1988.


To accomplish the gradual funding increase
we recommend will require a new agreement
between the Executive Branch and the Congress
on the shape of our future programs of economic
cooperation with the Third World. The primary
way of obtaining increases in these programs is
for the President to work for them. If they become
important for the President, they will generally
become important for Congress.


Additional Ways to Finance
Development Cooperation

The influence of our future programs will be
far greater if we can help to channel the growing
sources of finance around the world. In the
official community, the new resources are
from Japan and Italy. In addition we should be


actively encouraging the NICs, particularly
South Korea and Taiwan, to commence size-
able programs of economic cooperation. The
U.S. has influence with these nations; we
should use that influence to pursue common
aims on selected problems and areas of the
Third World. In addition, there are immense
new sources of capital surplus in banks in the
Far East that could be leveraged to serve
development purposes.
Currently, the U.S. is owed $73 billion by
Third World countries for past economic and
military aid. Some of this debt should be
stretched out. Some repayments could be
accepted in local currency and devoted to
bilateral development purposes. But the rest
should be used to finance future development
cooperation programs. For many years these
monies did flow into the aid account, so the
precedent exists. In a sense it is a ready-made
endowment.
Our relations with the Third World present
a difficult dilemma: the contrasting needs of
development progress, on the one hand, and tra-
ditional security considerations, on the other.
Both are legitimate; but together the two can con-
fuse goals. Historically, we have called on
bilateral aid appropriations to serve our mili-
tary/security tasks such as those in South
Korea, Vietnam, and more recently, in Central
America. Aid funds also finance payments on
base rights and underpin our approach to
Middle East issues. As a result, the majority of
funding for foreign assistance is based heavily
on political or security needs and definitions
and is mainly directed to advanced develop-
ing countries.
It is now desirable to separate development
cooperation funding and management. Separat-
ing military from development program funds
would clarify the goals of the United States
abroad and for the American public. It would
also make clear that certain trade-offs are
necessary and that payments are to be made
for activities that are very closely tied to U.S.
military needs. It would help to clarify just
what we are spending, in comparison with


iSeparating military

from development

program funds would

clarify the goals of the

United States abroad and

for the American public. m
















others, to bring about growth, to attack pov-
erty, and to attain other development cooper-
ation purposes.
The clearest case for separation can be
made for Base Rights payments. There are
now few bases in developing countries (the
Philippines being a notable exception), but
expenditures for this purpose are still Eco-
nomic Support Fund allocations. We should
consider shifting these payments into the
Defense Department budget. We should also
initiate discussion on moving at least some of
the payments out of the U.S. budget and con-
verting them to a burden-sharing arrange-
ment with our NATO allies and others who
benefit. It would also be reasonable to use our
defense budget to pay for any remaining Base
Rights obligations. Our allies benefit considera-
bly from the bases we maintain in various parts of
the world. Why should they not now, at this stage
of new economic and commercial realities, begin
to share the burden of such rental costs?
Our share of defense expenditures
markedly exceeds that of our Western Euro-
pean partners and Japan, whereas their pro-
portion of development aid is increasing and
ours is diminishing. The balance is disadvan-
tageous to the U.S. What we are paying for
(defense) is immensely more expensive than
what they are paying for (aid). And, in any
case, the immediate beneficiaries of much of
our defense expenditures are our European
and Far Eastern allies while the beneficiaries
of their aid are often tied to their own political,
economic and commercial interests. In addi-
tion, whereas we associate with military lead-
ers, they talk to commercial and civilian
leaders. For our relations with the Third
World, this arrangement costs much and
gains little. Any new burden sharing arrange-
ment ought to permit benefit sharing for the
U.S. as well.
The largest funding area in which confu-
sion persists is the Middle East where Eco-
nomic Support Fund allocations totaling over
$2 billion are provided to Egypt and to Israel.
In order to provide more clarity in this situa-


tion and to provide more focused oversight,
we should consider certain changes. In the
case of Egypt, we might shift to direct budget-
ary support in the same way that Israel
receives its funding. The U.S. contribution to
these two countries should be placed in a
separate account to cover Middle East peace
programs.
There is also a logic to merge remaining
ESF monies into development assistance, as
was done in Africa program funding within
the last year. If the Middle East and Base
Rights programs are separated out, it will be
seen that most of the remaining ESF monies
already are used for development purposes.
The realignment we suggest will clarify and
reinforce this and in the process will enhance
the image and respectability of U.S. coopera-
tion and its effectiveness.
Finally, a variety of financial mecha-
nisms need further exploration for possible
use in programs of development cooperation:
use of blocked currencies, debt conversion for
development purposes, loan reflows, lever-
aging the international private and public
sectors, and joint financing. The U.S. Devel-
opment Cooperation Agency should have the
necessary in-house or consultant talent to
develop these resources. It may well be that
additional legislative authority will be neces-
sary to take advantage of these possibilities,
e.g., in establishing intermediaries (such as
local foundations) that can be endowed by
using a variety of funding mechanisms.
These and related steps would provide a
new stability and mandate for U.S. programs.
Some of our current programs will gradually
switch to the mutual-gain mode and be
reduced in budget terms. But a basis is
needed for the long-term challenges that exist
in countries still moving more slowly and in
the poorest countries. For such areas and for
our support of the multilateral institutions, we
need a long-term vision and financial struc-
tures to match that vision.










I The Next Steps


Many decisions face a new administra-
tion in 1989. We urge that the new President
clearly enunciate the important priority he
attaches to international cooperation that will
stimulate broad-based growth, attack pov-
erty, and put an end to environmental degra-
dation. In short, we need the President to
champion the vision of the better world we all
hope to pass on to our children.


* INITIATIVES BY THE
PRESIDENT AND THE
CONGRESS

The key initiative by a new President will be
his projection of a new global vision. We would
also urge the announcement of major efforts
by a new Administration on the three urgent
issues discussed in this report: a new
approach to Third World debt; steps to
reverse Africa's economic crisis; and a new
priority for addressing global environmental
problems. These initiatives will send dramatic
and important signals of U.S. leadership, set-
ting a course for the key issues of the 1990s.
We urge that in the first year, the new Presi-
dent put the Third World on the U.S. political
map. During the year, the Secretary of State
and other high officials should visit key devel-
oping countries, and toward the end of the
first year, the President should also travel to
leading Third World states. We urge that
developing country leaders be invited for
early consultations in Washington and that
the new Administration meet regularly with
important groups of Third World ambassa-
dors. In all these meetings, it should be made
clear that new levels and forms of partnership
are envisaged.
We know that in the first months of the
first year, a new U.S. Administration will
select key people and set new directions. It
will be tempted to try to do everything in the
first ninety days. But the issues are complex,
and many require study and review. So a new
administration should allow time to evolve


new approaches. And it must pay careful
attention to attracting well qualified people to
lead our development cooperation programs.
Both parties have demonstrated ability to do
so and also the contrary.
We welcome the major review of the Foreign
Assistance Act of 1973, as (often) amended, now
underway in the Committee on Foreign Affairs of
the U.S. House of Representatives. Covering 600
closely worded pages, the basic legislative
mandate for our economic-aid programs
lacks coherence and direction while at the
same time imposing micromanagement on
the foreign assistance program.
Instead of micromanagement, Congress
should move toward broader policy review and a
focus on strategies and results. The changes in
style and substance we have recommended
will require greater trust by Congress. We
urge that creation of that trust be a priority
target of the new Administration and the new
Congress. Current aid legislation should be
examined carefully for such elements that
inhibit the cultivation of a long-term working
relationship in a spirit of confidence. Speci-
fically, Congress could begin by reducing its
notification procedures.
We offer suggestions in this report in the
hope that they will be useful both to the new
Administration and to the Congressional
studies now underway. Greater trust is
needed on both sides. A new global vision
and ways to add coherence to basic policies
are needed both in Congress and the new
Administration. But it is up to the new Presi-
dent to set the tone.


N BUILDING A NEW
CONSENSUS

We believe the policies and programs
suggested in this report can help regain
broader public support. Current programs of
U.S.-Third World economic cooperation are
considered special interest matters of public


T e President should

champion the vision of the
better world we all hope to
pass on to our children. m






















The changes in style
and substance we have
recommended will require
greater trust by
Congress. m

















policy. Few support the totality of the pro-
gram. But there is support from specific
groups and interested parties for each section
or earmark. What is frequently lost is the
whole picture. In truth, we need both broad
general support and special interest support.
Both could be invigorated by the broad vision
we have proposed, based on the global legacy
we all wish to leave to future generations.
To start the process of building a new con-
sensus, there is absolutely no substitute for an
active White House. Silence is the wrong signal.
These issues require an active President and sup-
port from the White House communications
infrastructure.
Beyond this, Americans must be edu-
cated to the changed world of the 1990s and
beyond. There is a rebirth of dynamic efforts
in public schools and among citizen groups to
foster more understanding of emerging global
challenges and opportunities. But the pace of
change from insular to broader perceptions
must accelerate. Here our needs for a more
competitive society and one that acts as a
good global citizen merge around educational
issues of geography, language, area studies,
and study of international issues.
We cannot quickly and cheaply refur-
bish school and adult education about the
world and our nation's role in it. Our country
must invest in enlarging the base of public
knowledge over a considerable number of
years with special efforts over the next decade
to make up for past lapses. These are tasks
and challenges for local school leaders as well
as state and federal officials and agencies.
A number of citizen groups have been
expanding nonformal education on these
important issues. We urge major sectors of
American society (business, labor, civic
groups) to consider strategies in their councils
to educate their constituencies on these
issues. Federal support can also be helpful. A
small USAID grant program currently sup-


ports this kind of education. It is miniscule in
comparison to the size and complexity of our
country and in comparison to similar pro-
grams among our Western allies. Expanding
it ten-fold would still make it no more than a
footnote in the program, but would be a very
wise investment. Other agencies that can be
supportive also must rethink their roles.
In this report we have explored serious
problems and opportunities facing the U.S. in
its economic relationships with the Third
World. We have stressed broad-based
growth, lessening of poverty, and improve-
ment of the environment. We have urged a
new cooperative stance. We believe that inter-
dependence means that their poverty and our
poverty are linked with the demonstrated fact that
their growth and development are ours as well.
Their environmental crisis is our environmental
crisis. Finding a sustainable environment for
them provides one for us.
Some will object to this formulation,
saying work either for poverty alleviation or
for your own gain, but don't mix the two.
What does their condition of life mean to us?
To that we reply by paraphrasing a statement
made by the religious sage Hillel some 2000
years ago:
If we are not for ourselves and our peo-
ples, who are we?
But if we are not for other peoples, what
are we?
And if not now, when?


A mericans must be
educated to the changed
world of the 1990s and
beyond. m

























Publications


Each of the cooperating institutions and organizations commis-
sioned research papers on the aspects of cooperation with the Third
World on which it is most expert. Those papers will be published under
the auspices of the individual organizations and institutions.
In addition, Michigan State University directly commissioned
papers from a number of other leading authorities. These papers are
listed below.
Those who wish information regarding publication plans and the
availability of individual papers are encouraged to contact the Center
for Advanced Study of International Development, Michigan State Uni-
versity, 306 Berkey Hall, East Lansing, Michigan 48824-1111; Tele-
phone: 517-353-5925.

* Symposium on U.S. Development Assistance: Retrospective and Pros-
pects, East Lansing, May 1-2, 1986
Hamilton, John Maxwell (Public Affairs Specialist, The World Bank).
"Foreign Aid: Mirror of American Culture."
Hoben, Allan (Director, African Studies Center, Boston University).
"AID: Organizational and Institutional Issues and Effectiveness."
Smuckler, Ralph H. (Dean of International Studies and Programs,
Michigan State University). "Development Assistance as a Com-
ponent of U.S. Foreign Policy."
Tinker, Irene (Director, Equity Policy Center). "Equity for Women and
Men: A Basic Need for USAID."

* Symposium on The Context for Development in the Next Decade, East
Lansing, June 1-2, 1987
Chandler, William U. (Senior Researcher, Worldwatch Institute).
"Development and Global Environmental Changes."
Lim, Linda Y.C. (Research Director, Southeast Asia Business Educa-
tion and Resources Program, Center for South and Southeast
Asian Studies, University of Michigan). "The Impact of Changes in
the World Economy on Developing Countries":'
Stover, John (Vice President, The Futures Group). "Social, Economic,
and Political Trends in the Developing World: The Context for U.S.
Development Cooperation in the 1990s."

* Symposium on Defining the Issues and Assessing the Needs, Washing-
ton, D.C., November 12-13, 1987
Bradford, Colin I., Jr. (Associate Director, Yale Center for International
and Area Studies, Yale University). "Cooperation with the Newly
Industrialized Countries in the 1990s."
Gordon, Lester (Institute Fellow, Harvard Institute for International
Studies). "U.S. Development Assistance in Retrospect: Lessons
Learned."


Maynes, Charles William (Editor, Foreign Policy). "U.S. Foreign Policy
Interests in the Third World in the Years Ahead."
Mistry, Percy S. (Senior Fellow, Queen Elizabeth House, University of
Oxford). "Financing Development in the 1990s" and "Reforming
the Development Financing System"
Streeten, Paul (Director, World Development Institute, Boston Uni-
versity). "Accelerating Development in the Poorest Countries."

* Symposium on U.S. Institutional and Policy Responses, Washington,
D.C., April 14-15, 1988
Hamilton, John Maxwell (Public Affairs Specialist, The World Bank).
"Development Cooperation: A Public Commitment."
Lyman, Princeton N. (U.S. Ambassador to Nigeria). "Beyond Aid:
Alternative Modes of Cooperation."
Shear, David (Senior Vice President, International Management and
Development Group, Ltd.). "U.S. Delivery Systems for Interna-
tional Cooperation and Development to the Year 2000."
Weihe, Ted (Executive Director, U.S. Overseas Cooperative Develop-
ment Committee). "Congressional Strategies."
Williams, Maurice I. (Senior Fellow, Overseas Development Council).
"Organization for Development Cooperation: U.S. Institutional
Policy Responses"

* National Conference on Cooperation for International Development: U.S.
Policies and Programs for the 1990s, East Lansing, May 15-17, 1988
Grant, James P. (Executive Director, United Nations Children's Fund
(UNICEF)). "Putting Crises to Work for People: Challenges of
Global Development in the Years Ahead!"
Soedjatmoko (former Rector of the United Nations University).
"Cooperation for International Development: Perspective from the
Third World."
Speth, James Gustave (President, World Resources Institute). "Pov-
erty and Environmental Degradation: Basic Concerns for U.S.
Cooperation with Developing Countries."
Wharton, Clifton R., Jr. (Chairman and Chief Executive Officer, TIAA-
CREF, and former Chairman, Board for International Food and
Agricultural Development (BIFAD)). "A New Era of Development
Assistance."
Wheeler, Joseph C. (Chairman, Development Assistance Committee,
Organisation for Economic Co-operation and Development).
"Opportunities for United States Leadership in a New Develop-
ment Partnership."








































































MSU-CASID
MICHIGAN STATE UNIVERSITY
CENTER FOR ADVANCED STUDY
OF INTERNATIONAL DEVELOPMENT




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