HodgBlog

The latest question in my series on US foreign aid is this: who actually receives the money we spend on foreign aid — are we sending it directly to foreign governments, charities, consultants, or what? Unfortunately, I was not able to answer this question definitively — the US government does not appear to publish this information in its foreign aid statistics. Here is what I did find:

• On the USAID home page, if you use the “Country Locator” to visit the home page of a particular country, and then scroll down to the bottom, you can find a section labeled “Congressional Budget Justification”. From that page, you can click on links for each program, and see who might get the money for each sub-program. However, exact amounts are not given, and it’s a projection rather than an actual commitment. Also, if you wanted to collect information, even from a single country, it would mean clicking on several links and extracting names of organizations from the text.
• A more comprehensive picture comes from the USAID Yellowbook, which is a listing of all active foreign aid grants from USAID to organizations, businesses, and universities for a given year, by country. However, the most recent available version of this publication is from 2001, so it’s not very current, and unlike the other statistics on the USAID web site, it only covers the USAID agency itself, not other US foreign aid.

Given a choice between these two less-than-perfect resources, I decided that the Yellowbook was the more useful. It comes in either an Excel spreadsheet or a PDF file containing the names of the grant recipients, starting and ending dates of the grants, and amounts. Unfortunately, it does not contain any other information about the recipients (such as whether they are consultants, charities, etc.), it does not include recipients that are foreign governments, and there are also about 4000 entries in the list. To make the research manageable, I decided to focus on Nicaragua to start. Here is what I did:

1. Since the grants cover different time periods, I decided that it would make more sense to consider an annualized amount. So, if a grant covered one year or less, I used the amount from the Yellowbook, and if it covered more than one year, I divided by the number of years covered to get an annualized grant amount.
2. I looked up each recipient on Google, in order to determine whether it was a non-profit charity, for-profit consultant, governmental organization, etc. I was able to determine a category for all but one of the recipients.
3. Added up the annualized amounts for each category, and calculated percentages (thank goodness for Excel pivot tables!)

In the table below are the results for Nicaragua (and a few notes on definitions are below the table). They do not look too terrible, but I think (from looking at the Budget Justification pages) that the situation has changed somewhat since publication of these data. Also keep in mind that amounts given directly to the Nicaraguan government are not included, or funds from agencies other than USAID. It is interesting to note that only about 9% of the funds analyzed are going directly to agencies or co-ops based in Nicaragua. My feeling is that probably these organizations have the best chance both of creating Nicaraguan jobs and of knowing what is really needed by the Nicaraguan people.

Notes:

• NGO: Non-Governmental Organization, also known as a non-profit or charity; I divided them up into ones based solely in Nicaragua, and US or International ones working in Nicaragua. For the US charities, I also looked up ratings for many of them, and they were all highly rated for efficiency by independent ratings organizations (i.e. most of their funds go to their programs, not to fund-raising, administrative costs, or executive salaries).
• Cooperative League: These are leagues of American or International cooperatives, who were given money presumably for their programs of helping establish cooperatives in other countries
• Nicaraguan Co-op: A few Nicaraguan cooperatives were given grants directly
• US For-profit Company: For the most part, the recipients in this category are consulting firms that specialize in working on international development projects. However, they are operating as for-profit US businesses.
• US Government Agency: Includes the US Department of Agriculture, the Defense Department, and the National Oceanographic and Atmospheric Agency
• International Government Agency: Agencies, such as the World Health Organization, which are funded and run by multiple governments
• Unknown: I was not able to determine which category a listing for “Nicaraguan Development Center” should be put into.