Reorganization of Foreign Assistance Programs Announcement of the Administration Proposal.

The White House announced today that President Carter will propose to the Congress a far-reaching reorganization of U.S. foreign assistance programs, the first such restructuring since AID was established in 1961. It is designed to improve the cost-effectiveness of U.S. assistance to developing nations.

The reorganization would consolidate policy direction of development agencies and responsibilities in a new International Development Cooperation Administration (IDCA). The IDCA Administrator would report both to the President and the Secretary of State, and would serve as the principal development adviser to each. The new Administration would be a small agency charged with coordinating, providing policy guidance, and evaluating the development activities of:

—The Agency for International Development, which administers the U.S. bilateral foreign assistance program;

—The Overseas Private Investment Corporation, which insures and guarantees U.S. private investments in developing countries;

—The proposed new Institute For Technological Cooperation, which will support research and technological innovation to reduce obstacles to economic development.

The agency will also have the following responsibilities:

—To ensure that development goals are considered in executive branch decisionmaking on trade, technology, and other economic policy issues affecting the less developed nations.

—To participate in the selection of U.S. Executive Directors of Multilateral Development Banks (World Bank, Inter-American Development Bank, Asian Development Bank, and African Development Fund) and advise these Executive Directors on

proposed projects and programs.

—To assume lead responsibility for U.S. budget support for policy advice to those international organizations and programs whose purpose is primarily developmental (U.N. Development Program; UNICEF; Organization of American States Technical Assistance Funds; U.N. Capital Development Fund; U.N. Educational and Training Program for Southern Africa; U.N./Food and Agriculture Organization (FAO) World Food Program; FAO Post Harvest Funds; and U.N. Disaster Relief Organization).

PURPOSE OF REORGANIZATION

The purpose of this reorganization is to manage more effectively U.S. development activities by making a single U.S. official responsible for formulating overall development policy, and for overseeing the numerous programs intended to implement that policy.

BACKGROUND

The reorganization was decided upon by the President after considerable consultation with interested members of Congress, and is consistent with the objectives of a bill submitted last year by the late Senator Hubert H. Humphrey.

METHOD OF REORGANIZATION

The reorganization will be implemented through a combination of reorganization plan (to be submitted to Congress in accordance with the reorganization authority enacted in 1977), legislation, Executive order, and administrative action. These steps will begin during the next several weeks.