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What’s new with the U.S. Economic Support Fund in 2016?
November 23, 2015
The Economic Support Fund (ESF), as a part of U.S. Foreign Assistance, aims to advance U.S. interests and assist in addressing areas of international political and economic weakness as well as security. The fund has ranged from $2.5 billion in 2001 to an estimated $4.7 billion in 2015. It is a separate line item from Development Assistance, as activities are strongly tied to U.S. interests and may not be purely developmental in nature.
USAID implements ESF-funded programs, either as direct budgetary support, grants, or projects. Supported programs include a range of activities from countering extremist ideology to the development of legal systems to increasing the role of the private sector in the economy. The long-term goals of these projects are to prevent wars and promote economic integration.
ESF programs have traditionally been limited to countries that are of most strategic and political interest to the United States, such as Iraq or Israel. By far the largest chunk of the FY 2016 request is for the Middle East and North Africa region. These funds are for Egypt, Yemen, Lebanon, Tunisia, Jordan, and the West Bank and Gaza.
However, in recent years the fund has also been used in many other countries around the world:
In Liberia, the strategy for using the requested $76.5 million in ESF funds will be to transition from post-Ebola crisis response to more sustainable economic assistance, including solidifying and rebuilding health, governance, water, agriculture, and education programs, all of which faced setbacks due to the Ebola outbreak.
In the case of Moldova, a funding request seeks to expedite Moldova’s economic integration into European markets and relieve any pressure or vulnerability from Russia’s influence.
The funding request for the Ukraine nearly tripled from $57 million in FY 2015 to $154.1 in FY 2016. Support for democratic and economic reforms as well as countering pressure from Russia are cited as justifications for these funds.
Recently, the President’s strategy of pivoting towards Asia to strengthen alliances is cited as justification for ESF spending. This request for “rebalance” sees an increase from $99.2 to $133.1 in FY 2016 largely due to a specific $22 million increased request in ESF for Burma. USAID goals for the country include supporting economic and political reform that promotes national reconciliation.
The fund works to support U.S. national security and increase U.S. economic prosperity by opening up additional markets and helping countries mo
ve towards more developed economies. The ESF continues to be something to watch as an indicator of the U.S.’s long term political and development priorities.