Not So Great Expectations

What Foreign Aid Can and Can't Do In the Arab World

A sign on the wall at the American University in Cairo. (Hossam el-Hamalawy / flickr)

Shortly after assuming the presidency, Barack Obama set his sights on reorienting the United States' relationship with Pakistan. For decades, Washington had been a fair-weather friend to Islamabad, eager to work together when its own security interests were at stake, but otherwise indifferent to Pakistan's domestic challenges. But recognizing that the fates of South Asia and, ultimately, U.S. security are inextricably linked with Pakistan's stability and prosperity, Obama signed into law the Enhanced Partnership for Pakistan Act (the Kerry-Lugar-Berman bill) just a few months into his first term. The bill authorized up to $7.5 billion in aid to Pakistan's civilian government over five years and was meant to usher in a new era of partnership and bolster democracy.

Nearly three years later, reality has set in. The partnership, although initially energized by the late Richard Holbrooke, Obama's special envoy to Afghanistan and Pakistan, was hamstrung from the outset. The problems do not stem only from the U.S. drone campaign and the covert raid that killed Osama bin Laden, nor is Islamabad's failure to take on difficult domestic reforms solely to blame. The problems are also due to the United States' inability to insulate medium-term development investments from diplomatic and security pressures and its overreliance on a complicated and creaky foreign aid system to administer development programs.
Even as officials at the White House, in the State Department, and at the U.S. Agency for International Development (USAID) cope with the problems of doing development well in Pakistan, they are in danger of repeating the mistakes made there in yet another civilian aid ramp-up. This time, Washington plans to use aid for political and economic development in the Arab Spring countries: Egypt, Libya, Tunisia, and, perhaps, a few more players to be named later. The administration's starting point is a request earlier this year that Congress establish the $770 million Middle East and North Africa Incentive Fund. The

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