U.S. Contributions to Multilateral Organizations

With the request submitted by President Barack Obama for the FY 2011 International Affairs Budget, much emphasis has been placed on bilateral U.S. assistance programs, namely food security, climate change, and health. But there is another aspect to U.S. foreign assistance that is often overlooked: monetary contributions to multilateral organizations. The importance of providing such assistance is significant. As a leader in the international community, these donations can leverage funding for multilateral organizations from other wealthy nations. Also, these organizations often exemplify Global Washington’s principles of effective foreign aid: coordination, transparency and accountability, local ownership, and targeting aid to those most in need.

As a means to implement these principles on a global scale, the U.S. Government supports two types of multilateral aid organizations in the International Affairs Budget: international organizations and programs and international financial institutions.

Each international organization and program receiving funding from the U.S. has a specific objective to solve problems experienced on a global scale such as climate change, human rights violations, and refugee crises. Organizations that receive U.S. contributions include the International Development Association, The Global Fund to Fight HIV/AIDS, Tuberculosis, and Malaria, the Organization of American States, and a variety of United Nations funds.

The two organizations that receive the most money from the U.S. Government, the Global Fund and UNICEF, are instrumental in delivering effective foreign assistance. While not engaging in implementation, the Global Fund receives and disburses funding from the international community to health programs aimed at those most in need. To ensure sustainable and positive results, each plan is developed by the recipient countries and chosen by the Global Fund on a performance-based system. The performance and results of each program are posted on the Global Fund’s website to make their implementing partners more accountable.

Focusing on child survival and education, UNICEF builds protective environments for children and equips local adolescents with the resources necessary to help their communities during and after national emergencies. Through communication and consultation with local populations, UNICEF promotes the participation of the community in meeting needs. Like the Global Fund, UNICEF posts the results of their programs online in an effort to monitor and evaluate progress for future decisions. UNICEF and the Global Fund are thus incredibly efficient in meeting the core principles of effective aid.

Apart from international organizations and programs, international financial institutions are generally focused on providing economic support in the form of loans and grants as a means to reduce poverty and build infrastructure. These institutions are integral to stimulating economic growth in the world’s poorest countries because they provide high-risk loans that private financial institutions would not make.

It is with this model that the World Bank’s International Development Association (IDA) satisfies a core principle of effective aid: targeting assistance to the people that need it the most. While addressing infrastructure construction, agricultural issues, health concerns, sanitation, and education with its loans, the IDA provides loans with no interest to countries selected by their relative level of poverty. Repayment plans of these loans are extended over a period of 35 to 40 years with a 10-year grace period. In doing so, IDA can be considered an effective tool to encourage and support economic growth in the developing world.

In sum, contributing to multilateral organizations is an effective way to leverage more funding for these organizations and a means by which sustainable development can be achieved.

Below is a list of the top ten multilateral recipients of U.S. funding. For a complete list of the funding levels received by each multilateral organization, please refer to the attached chart. Also, to learn more about the principles of aid effectiveness, read Global Washington’s white paper.