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From 2005 to 2010, 24 U.S. agencies provided more than $9 billion in trade capacity building (TCB) assistance to help more than 100 countries reduce poverty, increase economic growth, and achieve stability through trade. To report on TCB funding, the U.S. government conducts an annual survey of agencies and publicly reports the data in a TCB database administered by the U.S. Agency for International Development (USAID). GAO examined (1) how agencies' TCB activities are aligned with the agencies' goals, (2) the extent to which the TCB database provides sufficient information on key trends and funding, and (3) the extent to which USAID monitors and evaluates the effectiveness of its TCB activities. GAO focused on the agencies that reported the most funding for TCB activities since 2005--the Departments of the Army and State, the Millennium Challenge Corporation (MCC), and USAID--and the Office of the U.S. Trade Representative (USTR). GAO analyzed U.S. government data; reviewed agencies' strategic, budget, and program documents; and met with U.S. and foreign government officials in select countries.

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Recommendations for Executive Action

Agency Affected Recommendation Status
United States Agency for International Development 1. To enhance the management and evaluation of TCB activities, the Administrator of USAID should explicitly and publicly report the identified limitations associated with the methodology used to collect and report data in the U.S. government TCB database, including MCC and the Army's data issues, and consider ways to differentiate between categories of assistance that directly and indirectly relate to TCB.
Closed - Implemented
In its July 2011 comments on the draft report, USAID said that it had already taken steps to address GAO's concerns by prominently indicating on its website the nature of MCC obligations. In addition, beginning in 2012, USAID re-categorized types of TCB activities in the database in order to further clarify those activities that have been directly related to TCB activities and differentiate them from activities that indirectly relate to TCB. For example, the TCB database website notes that the database allows users to sort the data by categories, facilitating the analysis of activities which have a direct and comprehensive trade-related impact and those that have more of an indirect impact, such as physical infrastructure projects that can serve multiple economic purposes. In addition, USAID addressed the specific problem with MCC funding by noting on the TCB database website that, for many TCB activities in the database, the funding level does not match up with the fiscal year or years in which the activity is in operation or being funded. The TCB database further notes that large scale activities from MCC compacts are one such example, since MCC compacts typically run for five years but all funds for the entire life of the compact are obligated the first year, and therefore recorded in the TCB database for that time period.
United States Agency for International Development 2. To enhance the management and evaluation of TCB activities, the Administrator of USAID should develop a written plan that details the actions the agency intends to take to address the findings and recommendations of its recent multicountry evaluation of TCB, and its plans for conducting evaluations of its TCB activities on an on-going basis.
Closed - Not Implemented
As of August 2015, USAID had not developed a written plan that details the actions that the agency intends to take to address the findings and recommendations of its 2010 multicountry evaluation and its plans for conducting evaluations of TCB activities on an ongoing basis. USAID noted that it has taken a number of actions to incorporate the findings and recommendations from the multicounty TCB evaluation, From Aid to Trade: Delivering Results, A Cross-Country Evaluation of USAID Trade Capacity Building, into its management and evaluation of TCB activities, including the development of technical trainings for staff designing and managing the agency's trade-related projects, and analysis of the results of individual TCB project evaluations. USAID noted that under the agency's 2011 evaluation policy, it is committed to monitoring and evaluating USAID's entire portfolio of activities, including those related to TCB. However, USAID's 2011 evaluation policy is broad-based and does not target TCB specifically. By evaluating its TCB activities across countries on an ongoing basis, we noted that USAID could gain a better understanding of the linkage between TCB and development. We further noted that the agency could also gain valuable experience regarding the types of assistance important for the diverse set of countries and situations that could benefit from U.S. TCB assistance.

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