Message to the Congress Transmitting Annual Report on the Foreign Assistance Program.

To the Congress of the United States:

The fiscal 1971 Annual Report on the Foreign Assistance Program, which I transmit herewith, contains much hopeful news.

--The continuing success of the Green Revolution was evident in record crops of food grains, moving such countries as India, Pakistan, Turkey, and Indonesia steadily closer to a goal of self-sufficiency in basic foodstuffs and giving hope to others that this goal, considered inconceivable a few short years ago, can now be attained.

--Modern technologies in education are being explored with a view toward reducing the heavy cost of education, expanding its availability and improving its quality.

--Pilot projects for improving the delivery of health services in remote

rural areas offer great promise.

--Support provided by the Agency for International Development for population-related efforts rose to a record $95.9 million, as developing countries, recognizing the heavy burden of high population growth rates, intensified their programs to achieve effective family planning.

--Developing nations showed increasing awareness of the environmental impact of proposed projects in their national planning process.

During the past fiscal year, the United States Government provided $3.4 billion in economic assistance to the less developed world. This aid took a variety of forms--technical assistance, development loans, financial grants, concessional sales of agricultural products, emergency relief, and contributions to international lending institutions as well as to the United Nations Development Program, and other UN-related activities. Just over half the total-- $1.9 billion--was authorized by the Foreign Assistance Act and administered by the Agency for International Development. This report is essentially concerned with these programs.

Viewed in the perspective of the past decade, the less developed nations have made excellent progress. Their annual rate of economic expansion--averaging about 5.6 percent--exceeded even the five percent target projected by the United Nations for the Decade of Development that ended in 1970, reaching a level of more than six percent per year in the last years of the decade. This pace is more rapid than the growth rate of the United States at comparable stages of its development.

A major factor contributing to this record growth has been the increasing availability to lower income countries of external assistance from many sources. The United States can take pride in its role as an innovator and sustainer of this pattern of cooperation.

During the same ten years, the lower income countries also amassed a variety of other important resources for growth. Their technical and managerial experts have grown in number and experience, acquiring greater confidence in their ability to perceive national needs and to design and execute national development strategy. As the lower income nations have gained greater perspective and greater understanding of their own problems, they have been formulating more of their own development plans and organizing more of their own resources.

Other developments that must be taken into account in planning United States aid programs include the growth of new centers of economic and political power, the rapid pace of social and political change, and the increasing emphasis on man's relationship with his environment. Perhaps most significantly, there has been a substantial increase in the aid contributions of other nations and in the role of international lending institutions. Whereas a decade or so ago the United States was the predominant source of development resources and guidance, other industrialized nations and international lending institutions have since expanded both their contributions and their administrative capabilities. Today the United States is the foremost of donor nations in absolute terms, but the other industrialized nations have increased their participation to the extent that in many cases they are contributing a greater percentage of their total resources to development assistance than is the United States.

We have been working to adjust our aid programs to all these new conditions. A number of important reforms were embodied in two pieces of draft legislation submitted to the Congress in April 1971. We hope that those proposals will provide a basis for a discussion with the Congress of ways in which we can structure our programs to increase their effectiveness.

While the Congress has been considering these proposed reforms, the Agency for International Development has moved ahead with steps to increase the effectiveness and efficiency of its operations within the constraints of existing legislation. These initiatives have included:

--Separation of economic supporting assistance activities from development programs within the AID structure;

--Reduction of AID's American staff, by an additional six percent, reflecting a total reduction of nearly one-quarter over the past three years and bringing total AID personnel to the lowest level in the Agency's history;

--Substantial simplification of AID procurement policies and procedures;

--Substantial progress in concentrating technical assistance programs in priority sectors of agriculture, education, population, and health;

--Steps toward centralizing overseas lending operations in Washington.

While we look back with satisfaction at our accomplishments in the past and while we plan for further changes to help meet new challenges, we remain aware that the problems of development are stubbornly complex and that the solutions to some of them are still beyond our grasp. Yet each year's experience gives us new insights and firmer hope. And each year's experience also confirms two fundamental facts of development: (1 ) what the recipient country does to stimulate and accelerate its own growth is ultimately of greater value than anything we do or are able to do; and (2) a measure of help from the United States can be the vital factor in assuring steady progress toward development.

I believe most earnestly that the developed nations of the world cannot long prosper in a world dominated by poverty and that improvement in the quality of life for all peoples enhances the prospects of peace for all people.

RICHARD NIXON

THE WHITE HOUSE,

September 19, 1972.