USAID Forward: Where the local funding is going

Afghan women discussing health care with female representatives from the Provincial Reconstruction Team, U.S. Department of State and U.S. Agency for International Development. Afghanistan exceeded the agencywide local spending target of 30 percent in fiscal 2013. Photo by: USAF SrA Alexandra Hoachlander / ISAF / CC BY

While hardly the only major donor to steadily move funding to the local level in recent years, few donors have been as ambitious in going local as the U.S. Agency for International Development. Back in 2010, USAID Administrator Rajiv Shah set the target of funneling 30 percent of USAID’s funding to local organizations by fiscal 2015 — a key pillar of his sweeping reform agenda called USAID Forward.

Four years on, USAID’s latest data set on USAID Forward — released in April — reveals that the agency is now more than halfway toward its 30 percent local funding target. According to the agency’s data set, which only tracks direct awardees, 17.9 percent of the agency’s funding was channeled to local organizations in fiscal 2013 — up from 14.3 percent in fiscal 2012 and 9.7 percent in fiscal 2010.

Devex dug deeper into the data to analyze key trends in USAID’s local funding across its global portfolio. Here are our three conclusions.

Some USAID missions are much further along on localization, in part due to US foreign policy considerations

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From the early days of USAID Forward, agency officials have emphasized that USAID’s goal of channeling 30 percent of its funding locally is a global aggregate target — one that’s designed to provide its missions with enough flexibility to respond to individual country context while also holding the agency accountable for its commitment to go local. USAID doesn’t anticipate that each of its missions around the world will channel 30 percent of their funding to local organizations by 2015. In fact, in countries with weaker government institutions and less robust civil society, the agency may not even come close.

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About the author

  • Piccio

    Lorenzo Piccio

    Lorenzo is a contributing analyst for Devex. Previously Devex's senior analyst for development finance in Manila, he is currently an MA candidate in international economics and international development at the Johns Hopkins School of Advanced International Studies in Washington. Lorenzo holds a bachelor's degree in government and social studies from Wesleyan University.