An exterior power cannot stabilize a developing country--the first step must come from within, Andrew Natsios, the administrator of the U.S. Agency for International Development, told an audience Thursday at the Sanford Institute of Public Policy.
In a talk entitled "The U.S. and Challenges of International Development," Natsios highlighted the importance of continued aid to developing countries only under certain conditions.
"There has to be some control over the power of the state to abuse citizens," Natsios said.
In order to qualify for funding, developing countries have to rout out corruption, abide by human rights standards, and have health and education systems and economic policies that allow corporations to flourish, Natsios said.
President George W. Bush's administration has created an initiative called the Millennium Challenge Account, which will fund $5 billion of this aid.
"How can we create some tools in their hands to overcome the status quo?" Natsios asked. In his answer, he referred to the importance of cooperating with other organizations.
In 1970, all U.S. cash flows to the developing world came from the government, Natsios said. Now, only a fraction of the cash flow is from the government, with most coming from in private from non-government organizations.
He cited providing scholarships for people from developing countries to attend U.S. universities as an important form of aid. Unfortunately, he said, the number of people who benefit from this has decreased from 20,000 scholarships a year in the 1980s "to almost nothing now."
"If you asked [someone involved in USAID] what's the important thing AID used to invest in, they would say scholarships for American universities," he said.
Natsios also stressed the importance of microeconomics.
"Bolivia has adopted the democracy reforms, [but] they have not done the microeconomic reforms," he said, adding that subsequently, Bolivia is not growing economically.
Developing countries, he said, should ask themselves more questions that involve microeconomics, like how their tax policies affect investment.
The half-hour speech was warmly received by the approximately 100 people in attendance, and the hour of questions that followed focused on specific situations like those of Sudan's civil war and the problem of AIDS in Africa.
Megan Fotheringham, a graduate student in public policy studies who worked at USAID before attending Duke, said she was impressed by the speech.
"I was excited to hear that the Bush administration is much more involved [in issues involving developing countries] than what is generally reported or felt," she said.
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