Report: US Sends Aid To Countries Holding Billions of US Debt

The United States sends substantial amounts of foreign aid to countries it borrows money from, according to a recently released report from the U.S. Congressional Research Service.

China, Brazil, Mexico, India, Russia and several other countries that hold a total of at least $10 billion in U.S. Treasury securities receive foreign aid for various initiatives, including for HIV/AIDS prevention and treatment, illegal drug trade and environmental protection, the report says, according to The Hill.

This provision of aid to countries the United States borrows money from is a dangerous mix for both parties, according to Sen. Tom Coburn (R-Okla.), who requested the CRS report.

“If countries can afford to buy our debt perhaps they can afford to fund assistance programs on their own,”  The Hill quotes Coburn. “At the same time, when we borrow from countries we are supposedly helping to develop we put off hard budget choices here at home. The status quo creates co-dependency and financial risk at home and abroad.”

Read more about U.S. development aid.

About the author

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    Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.