AID-U.S.: House Cuts Multilateral Development Aid

By Jim Lobe Reprint | | Print |

Jim Lobe

WASHINGTON, Aug 3 1999 (IPS) - The US House of Representatives approved Tuesday a 12.7-billion-dollar foreign-aid bill which slashed development aid – particularly for multilateral agencies that provide loans to poor countries at concessional rates.

The 385-35 vote concluded several days of debate on the bill, which must now be reconciled by a joint House-Senate “conference committee” with a similar version passed by the Senate in late June, before it can be signed into law by President Bill Clinton.

The White House previously had warned that Clinton may veto any bill that did not include substantially more money.

The House bill was almost two billion dollars less than what the president had requested for the year 2000, and about 700 million dollars below foreign aid spending for 1999.

Clinton also was expected to submit a supplemental foreign-aid bill later this year that could total more than two billion dollars.

That package likely would include several hundred million dollars for Israel, Jordan and Palestine to fulfill pledges to support the Oct, 1998 Wye Accords; a big counter-narcotics package for the Andean nations, and a substantial new package for reconstructing Kosovo and the Balkans, administration officials said.

Clinton succeeded in increasing US foreign aid in both 1998 and 1999, ending a 12-year succession of aid reductions which brought US overseas assistance to the lowest per-capita level in the industrialised world.

A cut next year would be a major reversal. “A bill funded at this level would be grossly inadequate to maintain America’s leadership around the world,” said White House spokesman Mike Hammer after the House vote.

In addition, if the conference committee retained a House amendment which would ban aid to any overseas population agency that promoted abortion or lobbied governments to ease anti- abortion laws, Clinton was certain to veto the bill, as he has for the past several years.

Consideration of the 2000 foreign aid appropriations bill coincided with agreement by Congress to substantially increase the US defence budget to about 270 billion dollars next year.

This would be more than 20 times what it proposed to spend on foreign aid, about 25 percent of which consisted of military aid to Egypt, Israel, Jordan, and Colombia.

Much of the two billion dollars which the House denied to Clinton came from the multilateral development account, especially from the World Bank’s International Development Association (IDA) and the Global Environment Facility (GEF).

A House committee already had cut 227 million dollars from Clinton’s request of 804 million dollars for IDA, which provides interest-free loans to the world’s poorest countries, most of them in sub-Saharan Africa.

During the floor debate, however, it denied IDA another eight million dollars to protest the World Bank’s decision to fund a controversial project involving the settlement by ethnic Chinese of a sparsely inhabited area of Tibet.

Similarly, the House approved just about one third of the 143 million dollars requested for the GEF, which provides grants to poor countries to combat trans-border environmental problems, such as ocean pollution, ozone depletion and global warming.

Republicans, who enjoy a majority in both houses of Congress, generally were opposed to the GEF because of their belief that it was being used to implement the 1997 Kyoto Protocol to reduce “greenhouse-gas” emissions which contribute to warming.

They argued that the Protocol was unfair because it did not require developing countries to reduce their emissions and because its implementation could sharply reduce economic growth in the United States.

If anything, Republican opposition was even stronger in the Senate which approved only 25 million dollars for the GEF for 2000.

Like the Senate, the House also made cuts to Clinton’s requests for the Africa Development Fund (AfDF) and the Asia Development Fund (ADF), which, like IDA, also provided concessional loans to the poorest countries in the two regions.

The eight million dollars withdrawn from IDA for the China project, however, would be earmarked for the AfDF, bringing the total for that agency to 118 million dollars just 10 million dollars before Clinton’s request.

The House provided only 33 million dollars of the 120 million dollars Clinton had proposed be used to reduce hundreds of millions of dollars owed to the United States by some of Africa’s poorest countries.

While the Senate version of the bill also made sweeping cuts to Clinton’s overall package, only about 500 million dollars was cut from multilateral economic assistance, and most of the bilateral development aid requested by Clinton was retained.

In reconciling the Senate and House versions of the bill, population funding was likely to be the focus of a major battle in the conference committee.

Anti-abortion forces, which enjoy a modest majority in the House, are insisting that any foreign-aid legislation passed by Congress include the so-called ‘Mexico City’ policy, which bans US aid for organisations which promote abortion as a means of birth control or lobby their government to ease abortion laws.

The Senate has rejected such curbs in the past, and the House last week passed two amendments – the Mexico City ban and an alternative, supported by the administration, which required only that recipient organisations certify they had not used US aid for abortion or lobbying in order to receive the aid.

If the Mexico City ban emerged from the conference committee, Clinton was certain to veto the entire foreign-aid bill.

If, however, the alternative prevails, the pressure on Clinton to sign the bill, even if Congress does not provide more money, will be much greater, according to administration sources.