The Bush administration's 2006 foreign aid budget came under fire on Monday from aid organisations concerned that the proposed 14 per cent increase masked a decline in funding for projects in the poorest countries.
Officials said the increase, in the context of a tight budget overall, reflected President George W. Bush's priority of helping countries erase the freedom deficit that the US sees as a breeding ground for extremists and terrorists.
The foreign component of the budget was focused on “transformational democracy” and “transformational diplomacy” as part of the president's “bold agenda to push liberty and freedom in all four corners of the world”, a senior official said. Russia will be “graduated off” economic assistance but funding for democracy programmes will be maintained at this year's levels.
International assistance programmes are budgeted to total $18.5bn (€14.3bn, £9.8bn) in fiscal 2006 up from projected spending of $16.2bn this year. Not all of this counts as development spending. The largest single item is $4.59bn allocated for “foreign military financing”, much of which goes to developed countries. But there is also the separate “global HIV/Aids initiative”, with $3bn budgeted, against $2.6bn this year.
Top recipients in the aid budget are Israel, Egypt, Afghanistan, Pakistan and Colombia, a second official said. Iraq's reconstruction funding was provided in the supplemental budget.
The administration's favoured vehicle for aid is the Millennium Challenge Corporation (MCC), established by Mr Bush to channel funding to developing countries that pass tests of good governance, including levels of democracy.
Funding for the MCC is requested at $3bn in 2006. Congress appropriated $1.5bn for the MCC in 2005 some $1bn short of the administration's request.
Jamie Drummond, executive director of Debt Aids Trade Africa (Data), which was co-founded by Bono, the singer in the rock group U2, said Mr Bush had broken all promises made in establishing the MCC. Its budget was less than the $5bn originally promised for 2006; none of the money had yet been disbursed; and it appeared from the numbers that it had taken funds from other aid programmes, Mr Drummond said. An official said there was a plan to budget $5bn for the MCC in fiscal 2007.
Steve Radelet of the independent Center for Global Development estimated that US development aid could rise in 2006 to about 0.18 per cent of national income, from about 0.15 per cent in 2003. This still puts the US well down the list of donor nations as a percentage of national income.
