AID Assistance to the Eastern Caribbean:

Program Changes and Possible Consequences

ID-83-50: Published: Jul 22, 1983. Publicly Released: Jul 22, 1983.

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GAO reported on the methods the Agency for International Development (AID) uses to administer the U.S. assistance program to the Eastern Caribbean.

GAO found that, while AID has greatly increased its assistance to the Eastern Caribbean, it has made strategy changes which will place additional burdens on its staff. In the last several years, AID has decreased assistance channeled through the Caribbean Development Bank (CDB). Although AID has generally been satisfied with CDB performance, a conflict has arisen because U.S. policy seeks to deny assistance to the Government of Grenada and CDB prohibits the exclusion of potential assistance recipients based on political grounds. GAO believes that there are several solutions to this problem, including the use of CDB to administer trust funds for specific activities on a particular island. In addition, AID has recently initiated projects to provide assistance directly to Eastern Caribbean governments. However, these bilateral assistance projects will require more staff time and will increase management costs. Because these bilateral programs are recent, AID has not yet developed the strategy documents for individual islands. Finally, GAO found that AID is aggressively promoting private business investment and expansion in the islands. Because the private sector program is in the early stage of implementation, there are few documented results.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator, AID, should explore with CDB officials the potential use of trust funds through which CDB staff would design and implement AID bilateral projects on a particular island.

    Agency Affected: United States Agency for International Development

  2. Status: Closed - Implemented

    Comments: The strategy documents were completed in June 1985.

    Recommendation: The Administrator, AID, should ensure that strategy documents are developed for each Eastern Caribbean island which describe: (1) AID present and future bilateral projects on each island; (2) their relationship to AID assistance provided to the islands through regional institutions and other donor's activities; and (3) how these activities respond to each island's development needs, priorities, and objectives.

    Agency Affected: United States Agency for International Development

  3. Status: Closed - Implemented

    Comments: Mission has performed project evaluations on three of its projects and is in the process of contracting for a resident evaluation firm to answer questions raised by the report. This evaluation activity is scheduled for January 1986. Based on the individual evaluation and request for bids for an ongoing evaluation, AID has complied with the intent of this recommendation.

    Recommendation: The Administrator, AID, should undertake a comprehensive evaluation of its private sector program in the Eastern Caribbean by the end of fiscal year 1984 to measure: (1) types of business activity resulting from AID projects, their impact on the local economy, and persons benefited, including secondary beneficiaries; (2) if private investment caused jobs to be relocated from elsewhere; and (3) if results achieved justify the costs.

    Agency Affected: United States Agency for International Development


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