Devex Newswire: USAID gets good grades for grading itself

What does localization at USAID mean in concrete terms? The agency tries to provide some answers. Also in today’s edition: Some U.S. lawmakers take aim at … boogeywomen? Join us: Tomorrow at 11 a.m. ET (5 p.m. CET), we’ll be hosting an expert panel of career coaches to answer your most pressing questions about every aspect of the job-seeking process. Register now. Opening the books USAID rarely misses an opportunity to tout its localization agenda (then again, we rarely miss an opportunity to talk about it), but the agency is finally unveiling the nitty-gritty of that goal — and earning plaudits along the way. USAID revealed that in the fiscal year to September 2022, it gave $1.6 billion of direct funding to local entities, or around 10.2% of eligible funding. This was a sizable jump, and the highest level of direct local funding in at least a decade, though still far less than Administrator Samantha Power’s target of 25%. Nevertheless, the level of transparency impressed some. “Putting out the report, providing all of the data underneath — that's been really useful for a lot of stakeholders to interrogate how USAID’s approach is working, understand who’s included, who’s not,” Gary Forster, CEO at Publish What You Fund, tells Omar Mohammed. “It’s a lot further than other institutions have gone.” But it’s not all rave reviews. The definition of local is still a sore spot, with the agency saying that international brands can have local entities, citing the example of Deloitte Tanzania. “I don't think local and community-based organizations will agree that Deloitte Tanzania falls in the same category as they do,” says Gunjan Veda of The Movement for Community-led Development. Even the distinction between “community” and “local actors” is hotly debated. And there are sneaky caveats, such as what counts as “eligible” funding in the vaunted 25% target. Read: Is USAID taking the right approach on localization? (Pro) + Devex Pro members can get the most out of our USAID coverage. Not a Pro member yet? Start your 15-day free trial today. Beltway boon(doggle)? USAID isn’t the only one crunching numbers. As part of our regular updates on how much the agency is spending and where that money is going, Miguel Antonio Tamonan broke down the figures for USAID’s acquisition mechanism, which covers contract funding. There are a lot of familiar names on the list — hello Deloitte! — particularly those situated along D.C.’s infamous Beltway (yes, that’s where the term Beltway bandits hails from). Just like the previous fiscal year, the top 10 recipients accounted for half of the total amount spent on contracts. Eight organizations were also part of the previous list. And only one is a nonprofit; the rest are private consulting and development firms. Read: Who were USAID’s top contractors in 2022? (Pro) + For more practical business development and resource mobilization advice, including funding insights, sign up to Money Matters. Stealing trust USAID’s controversial decision to halt food aid to Ethiopia in the wake of revelations that much of it was being diverted on a historic scale — possibly by government forces — came up during Administrator Power’s trip to Kenya and Tanzania last week. At a press conference in Dar es Salaam, Power said that the suspension to the Horn of Africa nation only applied to food, not other development programming such as health and education. That’s cold comfort to the millions of Ethiopians going hungry after the civil war in Tigray and a persistent drought. Power said that while she was aware of the “devastating” situation, “what we have uncovered, unfortunately, through a very comprehensive investigation, is that the food that we were providing, much of it was not actually going to those hungry people. "And, you know, until and unless we can fix the system to make sure that the people who are hungry — the very people that you're talking about are getting the food — you know, it is very hard right now to have confidence that the food is reaching those very, very vulnerable beneficiaries." Power said she hopes reforms will be rapid. “We want to restart food assistance as soon as we have confidence that will reach Ethiopia's hungry people, and not those who actually outrageously at a time of acute need, took the food and used it for their own personal profit.” Related opinion piece: USAID, WFP aid suspension in Tigray will hinder peace process Funding … drag queens?! It’s par for the course for Republicans in the U.S. Congress to take aim at foreign spending — after all, the party has traditionally chafed at what it sees as runaway government spending and foreign aid is an obvious target. But this year’s proposed batch of cuts in the House mirrors the culture wars splitting the nation apart, reports Adva Saldinger. “​​The bill invites the culture wars into our foreign policy by making diversity, drag queens, and the critical race theory boogeyman and boogeywoman, distracting us from the real life or death challenges this world faces,” Rep. Barbara Lee, the top Democrat on the House Appropriations State and Foreign Operations subcommittee, said on Friday. Those real-life challenges include China, with Democrats claiming the cuts would undermine national security if the United States leaves global fora such as the United Nations to Beijing (House Republicans would eliminate funding for the U.N. regular budget and some agencies, including the World Health Organization). The proposed bill includes $52.5 billion for international affairs for fiscal year 2024, 12% lower than this year and 25% below President Joe Biden’s budget request. It makes cuts across almost every area but would gut funding for climate change and multilateral institutions. The usual caveat: The deepest cuts will probably be dead on arrival in a Democratic-controlled Senate, but because of the debt ceiling deal that limited total government spending, some cuts are inevitable. Among those that could take the hit? USAID. For the full list, check out Adva’s story. Boondoggles and boogeymen: Cuts in House foreign aid bill spark debate Money: Easier said than done Fresh from his trip to French President Emmanuel Macron’s summit on a new global financial pact, Inter-American Development Bank chief Ilan Goldfajn is beating the drum about crowding in more private capital for development. “We need to find pragmatic ways to attract and mobilize private sector capital,” he told a small gathering at the Atlantic Council on Monday. But: “It’s easy to say,” he conceded. The trick will be convincing private investors to take the plunge into risky assets. He is walking in lockstep with the new World Bank president, Ajay Banga, who is also pushing a message of de-risking investments so the private sector will be enticed to jump in. The two toured Latin America together recently, as they projected an image of a new partnership. Florence Pourchet, the head of corporate and investment banking for Latin America at BNP Paribas, expressed her faith in Goldfajn’s trifecta for the modern era: partnerships, measuring impact, and designing to scale. When combined, the three should produce better results in bringing the private and public sectors together, she said. Pourchet also noted that Latin America is leading in some areas. Last year, for example, Chile became the first country to issue a sovereign sustainability-linked bond. The $2 billion bond is directly tied to pledges made under the Paris Agreement. In other news Seven countries in East Africa are experiencing unprecedented levels of food insecurity, and nearly 60 million people do not have enough food to survive, according to a World Food Programme report. [VOA] The World Bank is set to provide $500 million in budgetary support to Sri Lanka. [Reuters] Myanmar’s cyclone survivors in the Rakhine state where majority of Rohingya live are reeling from dwindling aid a month after their homes were destroyed as the country’s junta banned transportation for aid groups operating in the area. [BBC] Sign up to Newswire for an inside look at the biggest stories in global development.