As the U.S. Agency for International Development focuses its attention on increasing local ownership, that often means funding in-country organizations to carry out local priorities. Sometimes, though, it means not focusing on certain sectors, to give them “space” to develop on their own at the hands of local actors and governments.
Red flags go up when an aid agency’s development priorities don’t match the host-country government’s. But USAID’s mission in the Philippines, the Filipino aid community and government are finding that allowing certain local priorities not to land on the agency’s balance sheets gives governments and promising homegrown organizations more room to grow into their development niche.
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Inclusive economic growth — a “top priority for the Filipino government,” according to Marissa Camacho, chief of party at the Ayala Foundation — is one sector the Filipino government and aid community has instructed bilateral donors like USAID — to a certain extent — to ignore.
“Where donors aren’t making inclusive economic growth their top priority, foundations and local funding mechanisms, like PPPs and microfinance schemes have decided to target economic growth,” Camacho said at a panel discussion in Washington, D.C., hosted by Save the Children to launch a new case study of USAID’s Local Solutions initiative, drawing on evidence from the Philippines.
“USAID focuses on education and health, and these sectors align with the ‘inclusive’ part of ‘inclusive economic growth,’” Eugenio Gonzales, chief of party a the Philippines-America Fund, told Devex in a phone interview.
Gonzales explained that education and health both provide the foundations for a healthy, well-prepared workforce, and that the Filipino government and local aid community keep this in mind when bilateral and multilateral donor funds become available.
“When a donor comes in, the [Philippines] National Development Plan acts like a menu of priorities, and the donor chooses priorities that compliment what’s currently being done by the government and local actors,” Gonzales said.
The Philippines is often cited as a poster child for local solutions, a hallmark of USAID’s reform agenda. The case study presented by Save the Children examines four countries using four criteria to examine the success of local solutions — support to country priorities, local participation in implementation, local access to resources and stakeholder accountability — and cites the Philippines as one of the top beneficiaries of the initiative.
“It’s not just [about] leveraging private sector partners, [it’s also about] considering how they’ve engaged on the ground and could engage further, if given the time and space,” said Susan Reichle during the panel discussion. Reichle is a counselor to USAID and a career foreign service officer.
George Ingram, a senior fellow in the Global Economy and Development Program at the Brookings Institution told Devex in a phone interview that despite the appealing rhetoric, lawmakers question the long-term feasibility of the Local Solutions initiative.
“The Philippines case shows it can be done, and because [bilateral donors’ main] focus is not on economic growth, [they] can focus on the inclusive part, building up long-term capacity in health, education and the environment while local actors, like the Filipino government and NGO community work on growth,” he said.
Instead of matching funding priorities sector-for-sector with the government’s, this strategy requires donors to look and listen carefully for what local actors are good at, and to support what’s already working.
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