Abstract:
The US Agency for International Development (USAID), responsible for US government aid to developing nations, had come under increasing criticism from Congress and others during the 1990s. At the same time, the proportion of foreign aid delivered by government had shrunk as other sources of aid--from such contributors as nonprofits, universities, and private industry--grew. This case describes the rationale and formative period of a new effort by AID to achieve its goals--by partnering deliberately with private sector and nonprofit players in order to pool resources rather than duplicate aid efforts. The Global Development Alliance (GDA) would face Congressional skepticism about whether such partnerships amounted to corporate welfare, as well as worry that favored congressional projects would lose funding. It also faced internal resistance from career USAID officials accustomed to familiar routines and procedures.
Learning Objective:
The case describes the start-up of GDA, how it sought to integrate the new concept of private and nonprofit sector partners into the USAID culture, and examines specific decisions faced by the GDA leadership team on structure, legal instruments, and budget issues. In addition to raising questions about how a wealthy country can best help poorer ones, the case spotlights the issue of how government-business relations should be structured when government is neither procuring nor regulating, but seeking to build public-private-nonprofit alliances.
