As a meeting summary, this page summarizes discussions held at a Brookings Center for Sustainable Development private roundtable in December 2024.
With four successive U.S. administrations, two Republican and two Democratic, over a twenty-year period having committed and taken actions to implement locally led development (LLD), it was deemed timely in 2024 to capture the elements of that continuum and consider how to further advance progress. On December 17, 2024, the Brookings Center for Sustainable Development hosted a private roundtable that brought together key actors from the last three administrations with representatives of Northern and Southern civil society organizations and bilateral donors.
It is worth acknowledging that, despite the critique that USAID, according to its own analysis and that of Publish What You Fund (PWYF) and Oxfam, is not on track to meet its target of 25% of funding going directly to local organizations by 2025. A new report issued by PWYF on the day of the roundtable revealed USAID to be considerably ahead of four other major bilateral donors in executing LLD. That was acknowledged by one of the bilateral donor representatives commenting: “From the outside, U.S. assistance looks good.”
This note is divided into two sections. The first section is an overview of the first topic of the roundtable discussion—a stocktaking of U.S. commitment and implementation of LLD—with greater specificity of key policies and actions by each administration documented in the appendix. The second section focuses on the second topic—actions to further advance the objective.
Section 1. Stocktaking
Several participants noted that—while the current phase of LLD can be traced internationally to the 2005 Paris Declaration on Aid Effectiveness, and for the U.S. to the Bush administration’s establishment of the United States President’s Emergency Plan for AIDS Relief (PEPFAR) in 2003 and the Millennium Challenge Corporation (MCC) in 2004—U.S. assistance programs engaging local stakeholders on their priorities extends back decades. Historically, some USAID missions designed and implemented their programs with the engagement/cooperation of local stakeholders. In the Marshall Plan the U.S. charged European partners with identifying their priorities as to how U.S. assistance could be useful.
The Bush administration’s contributions to LLD—the design of the MCC to charge partner countries with proposing the contents of an assistance compact and managing implementation, of PEPFAR to execute through local health organizations, and its founding role in launching the Country Coordinating Mechanisms of the Global Fund to Fight AIDS, TB, and Malaria in 2002—preceded any concerted or systematic U.S. attention to LLD and presaged what was to follow.
The Obama administration proceeded to bring LLD into the core of its development policies and programs—embedded it in its principal aid reform agenda laid out in USAID Forward; placed a senior foreign service officer in the front office to oversee Local Solutions; and set a target of 30% of funding going through local systems.
The Trump administration maintained a focus on LLD but articulated it in the form of the Journey to Self-Reliance and, like the Obama administration, built it into a number of specific policies and strategies and moved PEPFAR further in executing through local organizations.
The Biden administration doubled down on LLD, appointing a senior advisor for localization in the front office and embedding LLD in its comprehensive Policy Framework: Driving Progress beyond Programs, in addition to specific policies and strategies. It took the further step of setting two targets: 25% of funding going directly to local organizations by 2025 and 50% of funding being driven by local priorities and design by 2030. It has issued three reports covering each of the past three fiscal years on progress toward the targets.
Greater details and links to the relevant documents are in the appendix.
Section 2. Moving forward
The stocktaking was followed by a robust discussion on how to further advance LLD. There was strong agreement that LLD should continue to be a priority in the next U.S. administration, as well as among other donor governments. A range of suggestions on how to advance LLD were put forward.
Two conflicting views
There were conflicting views on two structural issues. One pertained to “G2G” support—providing assistance to governments. Some participants emphasized that governments are important actors with roles that civil society cannot perform. The current localization agenda risks creating parallel structures and leaving government weak. But others were concerned that G2G undermines the principles of national ownership whereby funds are shared with civil society, academia, and local communities. In this view, it is better to invest in civil society by providing core funding to strengthen local civil society organizations and invest in civic space that is under threat.
A second key difference of views emerged around setting targets for LLD. One participant proposed setting targets for each mission, not just agency-wide. Others proposed using the USAID small business model, putting targets in performance plans, and not promoting mission directors if targets are not met. An opposing view considered targets as a distraction from the quality and nuances of LLD and creating an unproductive, time-consuming cottage industry.
A range of practical recommendations were raised throughout the discussion. What follows is an attempt to place the proposed actions into categories, noting that individual recommendations were sometimes at odds with each other.
Methodology
- Clarify USAID’s definition of what qualifies as local; eliminate affiliates of Western organizations from eligibility; use PEPFAR’s definition of local (see pages 83/84).
- Measure impact and conduct ex post evaluations to determine whether local solutions are more successful than using traditional implementers.
- Position USAID as a market creator—require traditional implementers to function in an LLD mode; encouraging formation of locally-led grantee coalitions.
- Establish a theory of change around systems of LLD for the broader development community.
- Recognize the nexus between humanitarian and development assistance.
- Require direct feedback from local organizations.
Funding
- Move management of money/programs from headquarters to missions. In recent years the balance of funding has shifted from missions to headquarters, but missions have closer relations with local stakeholders and are making more progress on LLD.
- Note: The discussion did not raise the possibility of moving funding from contracts and cooperative agreements to grants, an idea raised elsewhere. Grants involve buying into the mission/priorities of an organization, simplifying the procurement process, and reducing accountability requirements.
Procurement
- Create expedited processes; more calls for open proposals.
- Replace cost-plus fixed fee awards with performance-based awards.
- Include local people in technical evaluation committees (as has been done in the past), thereby bringing in local views and reducing burdens on mission staff.
- Restrict funding to only local and new partners.
- Move funding from project to non-project assistance (NPA) to reduce the complexity of the procurement process. NPA includes government-to-government reimbursements, institutional support, commodities, and debt relief and uses partner country systems rather than funder systems.
- Clear away the underbrush of compliance requirements and intermediary partners.
- Move the repeated calls for ”increased risk tolerance” (in policy papers) into action.
Workforce
- Expand the number of USAID staff dealing with local partners, including the number of acquisition officers (AOs) and contract officers (COs), and move some AO/CO decisions to program officers.
- Invest in training the workforce.
- Give greater authority to Foreign Service Nationals (FSNs).
- Establish a working capital fund (like at State and PEPFAR) which allows program funds to be used to fund additional staff.
- Focus on internal culture change within USAID to be more compatible with LLD.
Organizational structure
- Create cross-agency coordination teams.
- Provide opportunities for peer sharing and learning.
External communications and messaging
- Explain how money from Northern taxpayers benefits the Southern poor—to counter the myth that it supports local elite, but also review the extent to which local partners tend to be English-speaking elite.
Conclusion. Advancing locally led development across administrations—no matter the term
Administrations like to have their own terms for key initiatives—over three administrations the terms have included USAID Forward, Local Solutions, Journey to Self-Reliance, and New Partnership Initiative. Whatever term is used, what is significant is USAID has been on a steady course of advancing locally led development in its approach to sustainable, inclusive development. And the discussion at the roundtable demonstrated considerable bipartisan support on a range of steps to further advance LLD.
Appendix. Actions on LLD by four administrations—2003-2024
George W. Bush administration
- President’s Emergency Plan for AIDS Relief (PEPFAR) (2003): Systematic handover of cooperative agreements from U.S.-based universities and non-governmental organizations (NGOs) to local groups.
- MCC (2004): Established compacts as the vehicle for providing assistance to well-performing countries, the initial design of which is by the partner country so as to be based on local priorities, and procurement and management of implementation is by a local quasi-governmental Millennium Challenge Authority.
- New Partners Initiative (2007): Competition limited to new entrants and “underutilized” partners.
Obama administration
- USAID Forward (2010): The administration’s principal reform agenda included a focus on local partners and local solutions.
- USAID Policy Framework 2011-2015: Embedded in the framework was an emphasis on the role of local institutions, partners, and capacity strengthening.
- Local Systems: A Framework for Supporting Sustainable Development (2014): Provided a roadmap as to how to engage local actors.
- Administrator Raj Shah in 2011 set a target of 30% of funding (page 5) going through local systems, data for which was reported in annual progress reports (2013 report).
Trump administration
- Journey to Self-Reliance (2017): Declaration that “the purpose of U.S foreign assistance is to end its need to exist; created Self-Reliance Roadmaps that use third-party metrics that measure capacity and commitment in countries to identify where the United States can begin to transition away from traditional foreign assistance and show how USAID can target its investments to help countries along this continuum.
- Senior Obligation Alignment Review (SOAR) (2017): Senior leadership review of proposed procurements above $10 million, emphasizing deploying innovative solicitations and award instruments and creating greater opportunities for new, underutilized, and local partners.
- Risk Appetite Statement (2018): USAID acceptance of higher tolerance for programmatic risk and innovation, including funding local actors.
- New Partnership Initiative (2019): Launch of open-ended Annual Program Statements (APS) that solicited short Concept Notes only from new entrants and underutilized partners, especially local and “locally established” organizations.
- Policy on Promoting the Rights of Indigenous Peoples (2020): USAID policy statement for structured engagement with local communities and beneficiaries.
- PEPFAR (2017): Set a target of shifting 70% of field funding to local partners (reached 60% in 2021); included local voices in annual PEPFAR planning process and in ongoing, site-level monitoring.
Biden administration
- Policies: Integrated locally led development into a number of policy statements and strategies.
- Policy Framework: Driving Progress beyond Programs (2023) establishes locally led development as a key component in USAID’s overall development framework and explains that it is embedded in a range of other policies and strategies …
- Localization page: USAID website that explains USAID approach to local led development and provides links to relevant documents.
- Work with USAID: USAID webpage with links to explain how new and local organizations can work with USAID.
- Acquisition and Assistance Implementation Plan Update (2024) includes changes to USAID’s acquisition and assistance procedures and requirements to facilitate locally led development.
- USAID Localization Progress Report: USAID has issued three localization progress reports, for FY2022, FY2023, and FY2024.
- ADS 201 (Automated Directives System): Requires Country Development Cooperation Strategies (CDCS) and Pillar Bureau Reviews to include consideration of locally led development—”A brief explanation of how USAID will leverage locally led development, national, or institutional commitment and/or capacity…”
- ADS 303– 303.3.320 provides for translating documents into non-English languages.
- OMB revision to Title 2, Code of Federal Regulations (2 CFR) reduces barriers to local organizations, including (per this blog) “gov registration flexibility, a de minimis rate increase, language accessibility, allowability of closeout costs, an increased threshold for fixed amount subawards, simpler assistance solicitations, and an increased audit threshold.”
- Donor Statement Supporting Locally Led Development: USAID spearheaded an initiative committing to LLD, signed by 21 bilateral donors and 26 private philanthropies.
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Commentary
A stocktaking on locally led development and what next
January 21, 2025