A new U.S. foreign aid program aimed at providing billions of dollars to countries with "good government" is poised to approve its first package of grants at a meeting of its board on Monday, according to administration and congressional officials.
The proposed grants, totaling close to $100 million, are for Madagascar, said the officials, who spoke on condition of anonymity because the decision has not yet been finalized.
If the grants win approval, the move will come three years to the day after President Bush proposed creating the program, which is intended to revolutionize the way much of the world's aid is distributed. Dubbed the Millennium Challenge Account, the program limits grants to countries that are clearly committed to respecting the rule of law, rooting out corruption, and other such principles -- shifting away from the old model of showering money on friendly regimes for foreign policy reasons. The theory is that the aid is more likely to be effective if it goes to governments that will use it wisely.
Under the president's original proposal, Washington would spend $10 billion on the new grants from 2004 to 2006, escalating gradually so that by the third year overall U.S. aid spending would be increased by $5 billion, or about 50 percent. But that schedule has fallen well behind, and the budget that Bush submitted to Congress last month drew criticism for proposing only $3 billion in spending for the program.
The doling out of the first grants has been impatiently awaited by aid advocates, many of whom hailed the program but have complained that it has taken too long to get started.
"The fact that three years has gone by obviously does not reflect well on the administration," said Steven Radelet, a scholar at the Center for Global Development who has written a book on the program. The fault for the delay, he added, belongs with the White House rather than with the officials of the Millennium Challenge Corporation -- set up to run the program -- because the corporation could not start functioning until the administration pushed the necessary legislation through Congress in January 2004.
In a phone interview yesterday, Paul V. Applegarth, the corporation's chief executive, contended that his agency moved quickly, noting that the list of 16 countries eligible for the first round of grants was announced by May. Three weeks after that, staffers had visited all 16 countries to explain the process necessary to obtain grants.
"At that point, the ball really got handed over to the countries," Applegarth said. "We didn't set deadlines. We said, 'Take your time setting your priorities. . . . Take your time to get it right, then come to us and we can work with you.' "
Recipient countries submit their own proposals for how they would spend the money, rather than working with international aid specialists to develop priorities, in the belief that a home-grown plan is more likely to produce results.
Applegarth declined to discuss details of the Madagascar grant proposal because the board, which includes Cabinet members, has not yet discussed it. Like the other nations on the list, half of which are in Africa, Madagascar is very poor, with income per capita at less than $300 per year.