On July 9, 2011 the world’s newest state was born—the Republic of South Sudan—when it formally seceded from the Sudan at a ceremony attended by 30 heads of state. What happens to the fledgling Republic matters to the region and to the United States and Europe–not as a humanitarian victim but as a potential strategic ally.

I served as the U.S. Envoy to Sudan under President Bush and attended the independence celebration in Juba as a guest of the Southern government. I was joined by many other westerners who had worked with the South over more than two decades to publicize the atrocities taking place, to mobilize humanitarian and development resources, and to work on the political and diplomatic issues. When I took my first trip to Sudan in 1989 during a terrible famine in the South which claimed 250,000 lives I never thought this day would come.  But it has.

The new Republic will determine the stability of the nine countries bordering Sudan which have been destabilized by the chaos of the two civil wars and the weakness and dysfunctions of the Sudanese state.  The Bashir Islamist government, which took power in a 1989 coup, planned to use South Sudan as a base to spread its ideology across Africa—a threat not lost on African countries with large Muslim populations which have had historically good relations with their Christian neighbors.  The Bashir regime’s ultimate ambitions have not changed; it is the internal weaknesses of the Sudanese state that have constrained their adventurism.  In the 1990’s Sudan supported and was headquarters to nearly all of the world’s most violent Islamist groups, including Al Queda.  Osama bin Laden lived there for five years as an honored guest of the Sudanese government.

Egypt’s survival depends on the Nile River, whose waters flow through South Sudan.  International companies are now rushing to develop the vast resources of the South:  luxuriant soils; plentiful water for irrigation; vast areas of open land which are ideal for large-scale farming; and enormous and untapped mineral resources including rare earth metals, gold, copper, diamonds, and coltan.  Seventy-five percent of Sudan’s oil reserves lie in South Sudan.

July 9 marked the end of an interim period begun in January 2005 to implement the Comprehensive Peace Agreement (CPA) which western governments, particularly the United States, UK, and Norway, played a central role in negotiating.  It ended a 22-year civil war in which 2.5 million Southerners died.

The North agreed to allow the South at the end of the six-year period to vote in a referendum on whether to secede and form a new country. That vote took place January 9, 2011; the South chose independence by a 98.8 percent margin. The nearly unanimous vote speaks more than anything else to the bitterness and hostility the South—African and predominately Christian—feels towards the Muslim North, dominated by Arab tribes of the Northern Nile River valley.

July 9 may also mark the informal end of the heavy dominance over western Sudan/Darfur policy by U.S. and European advocacy, NGO, and religious groups because the South will now become an independent state, with a seat at the UN, embassies around the world, a large standing army (150,000 troops strong), an annual budget of $3-4 billion—and its own foreign policy, which advocacy groups may not necessarily understand or support.  For much of the 20^th century, South Sudan was viewed by its western partners almost exclusively as a helpless victim that needed international protection (which it did) from the predatory and aggressive behavior of successive Khartoum governments, trying since 1956 to forcibly impose Arab and Islamic culture.   It was a victim, but won’t be anymore.  The new Republic of South Sudan will need more long-term strategic allies with common interests than it will be a victim in need of advocates.

The South has development challenges—weak government institutions, corruption, high illiteracy rates, and a largely subsistence agricultural economy. But its potential to be a powerhouse in the expanding east African economy is real.  Its economy is now booming, thanks to oil revenues, the return of the Southern diaspora to build homes and start businesses, and international corporations setting up offices to explore its resources.

Most Southerners have a deep affection for the United States and Europe, who they believe supported them in their most desperate days and forced the intransigent North to sue for peace.  Southerners share with westerners a deep suspicion of radical Islam. Since the peace settlement of 2005, the United States and the British governments have had a modest non-lethal military assistance program in the South—several Southern officers are training at U.S. military schools. All of this suggests America and Europe are in a strategic position to influence the development of the new Republic, but the budget and lending crisis in Washington and Brussels are putting donor support at risk.  Just when the reconstruction program and military assistance should be ramped up or at least held steady, they risk cuts.

With independence, the U.S. and European governments ought to consider a long-term strategic alliance with the Republic of South Sudan that would not be costly at a time when the federal budget deficit is so large.  First, the United States and Europe should consider a free trade agreement with the South, tying its economies to theirs and facilitating western business investment.   Adding the influential American and European business communities to those supporting closer ties with the South would cement this alliance.

Second, NATO or the United States and any European countries individually should negotiate a security guarantee agreement with the South:  if the North attacks the South it would be considered an attack on the United States or Europe, mimicking the language of the NATO alliance.  Such an alliance would be welcomed by the South, and send a clear signal to any future Khartoum government that it would face retaliation from the United States and Europe if it attacked the South, which would act as a deterrent to war.   As important as protecting the South, a security guarantee would also constrain militant pressure among younger Southerners who demand the new Republic launch an attack on the North to remove the Khartoum regime.

The western governments have a history of snatching defeat out of the hands of victory by walking away from historical moments such as these.  This is no time to declare victory. We should not repeat that mistake in South Sudan.

Andrew S. Natsios is a Distinguished Professor in the Practice of Diplomacy at Georgetown University’s Walsh School of Foreign Service. Mr. Natsios served as Administrator of the U.S. Agency for International Development (USAID) from 2001 to January 2006, and served on GMF’s Transatlantic Taskforce on Development in 2008-09.

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On both sides of the Atlantic budgets are under severe pressure. Governments are seeking to improve the effectiveness of development resources. Last week, the State Department and the U.S. Agency for International Development unveiled the Quadrennial Diplomacy and Development Review, which seeks to bring a more unified, focused and results-based approach to U.S. civilian power. Starting in January 2011, under the Lisbon Treaty, the European Union will launch a new European External Action Service to strengthen policy coherence in areas such as development. Such initiatives could lead to better planning and management of scarce resources with a stronger focus on results. This could help boost legislative oversight as well as evaluation by development agencies. But, there are perils involved with this trend. The following blog posts by Transatlantic Taskforce members Andrew Natsios and Richard Manning offer some insightful perspectives on this subject (http://blog.gmfus.org/2010/12/20/can-results-based-approaches-escape-obsessive-measurement-disorder/).

Donor governments and international institutions are placing renewed emphasis on proving measurable results from aid programs, increasing oversight, and designing more and more metrics to track implementation.  In the United States a discussion of these practices has become even more relevant because of the debate over aid reform and now with the mid-term U.S. elections, the shift in popular sentiment against increased public spending, and the potential for cuts in aid.

Although well intended, this excessive focus on results could potentially exacerbate the negative impact from what I call an “obsessive measurement disorder” – the intellectual disorder of focusing too much attention on quantitative indicators. This disorder has collapsed the time horizon of programs because oversight agencies want evidence of more immediate results when the most sustainable development programs require much longer time frames to be successful.  I published an essay with some thoughts on these subjects called the “Clash of the Counter-Bureaucracy and Development” in July 2010.

Accountability and performance measurements in foreign aid programs are not new.  Because aid money is spent in countries with weak, failing or non-existent institutions, program failure rates are higher, accountability problems more frequent, and public and thus parliamentary or congressional demands for greater oversight more aggressive than for domestic programs managed in developed countries.

In the U.S. system pressure from regulators charged with the oversight of all federal departments – such as the Inspector General (IG), the Government Accountability Office (GAO), the Office of Management and the Budget (OMB), and the Director of Foreign Aid programs at the State Department – have forced USAID, the PEPFAR (the U.S. government’s HIV/AIDS program), and the Millennium Challenge Corporation (MCC) to design hundreds of metrics to track program performance and improve management, at least theoretically.  These kinds of entities and their command and control systems make up what political scientists call the  counter-bureaucracy—federal agencies created to oversee the federal bureaucracy.

This obsessive measurement disorder has now spread across the international system. The Gates Foundation uses metrics-based approach to manage its vast grant portfolio, a management tool borrowed from private industry.  The UN Millennium Development Goals have now been translated into a set of metrics. The World Bank now has five independent oversight systems over its programs.

These command and control systems have developmental consequences—many with perverse results—and sometimes clash with good development theory and traditional aid practice.  For example, what is easily measured is more likely to get funded by aid agencies, budget offices, and legislative bodies, even if the measurements are not particularly significant to the transformation of a poor country.

The excessive focus on these systems ensures that larger, more established institutions—contractors, large universities, advanced developing countries, and major non-governmental organizations—with a mastery of the labyrinth of regulations and law get contracts or grants to carry out programs (or get budget support through local governments). Aid agencies are increasingly risk adverse because they do not want to get bad audits, miss program deadlines, or experiment with new approaches that might fail. Compliance managers running these systems are now more powerful than development experts; they make up a greater and greater proportion of aid career staffing rather than the development practitioners that do the actual technical work.

This elaborate oversight apparatus is not free:  oversight costs money for developing countries running programs, and contractors and NGOs producing the reports, audits, and assessments required. It is sucking up a larger and larger portion of aid program funds. The greatest intellectual fallacy of the architects of this monolith is that it is making development better: the least measureable programs are often the most developmentally significant (such as democracy and governance programs) and the most easily measured are sometimes those with the least significance.

Measurability has little to do with transformational development; numbers are often misleading indicators of performance.  How does an aid manager measure the impact of the new constitution written with technical assistance, or an anti-corruption program, or support for an indigenous think tank or research center?  Most bilateral and multilateral aid agencies are instead judged using very shallow indicators such as how fast they disburse (or loan) public funds (an easily quantifiable measurement) rather whether they are producing deep impact in the field.

The Millennium Development Corporation (MCC), President Bush’s signature foreign aid program the Obama Administration has continued to strongly support, faced heavy criticism from Congress, the IG, OMB, and the GAO for its slow disbursement rates. More than anything else, this was a function of weak institutions in poor countries, not a failure of the MCC.

Rolling back this massive over-regulated system will not be easy. Given the current fiscal environment, it’s a growing problem for European and other leading donors as well. In the case of the U.S., it will require the Congress and the Executive to come to a better understanding on results for aid programs based on sound development practice. Otherwise U.S. foreign assistance will become increasingly the by product of a dysfunctional bureaucracy that has little to do with development.

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Transatlantic Taskforce on Development Blog Series:

On both sides of the Atlantic policymakers are struggling with a common problem – how can we forge better cooperation across the so-called three Ds – development, diplomacy and defense? This challenge was well-identified by the Transatlantic Taskforce on Development, which set out a number of recommendations to address this issue. Since the launching of the Taskforce, there have been major policy reviews and debates in the U.S. and Europe on the three Ds. The following blogs by Taskforce members Richard Manning (UK) (Development and Security:Will European Institutional Changes Help or Hinder Effective Action? ) and Andrew Natsios (U.S.) represent fresh assessments of the risks and opportunities for Europe and the United States as this debate continues to unfold with implications for transatlantic cooperation.

Development and Security: Can the United States overcome beltway disputes and elevate Development alongside Defense and Diplomacy?

WASHINGTON - The GMF Transatlantic Taskforce on Development urged donor governments to bridge the security and development divide in order to achieve a more coherent policy for addressing developing country problems. Of course, the devil is always in the details of exactly how this will be done.  The current debate in Washington is stalled because of competing and conflicting visions of what the aid architecture of the U.S. government ought to be, and what role development should have in it.  In the absence of a clear, unified vision for U.S. foreign assistance – particularly long-term economic development – the United States will continue to be limited in its ability to lead and partner with Europe, other donors, and host-countries in addressing major global challenges – from global health to fragile states.

The Bush administration formulation of the three D’s—Defense, Diplomacy and Development—as the principle instruments of national power in the post-9/11 world has been carried into the Obama administration as Secretary Clinton has repeatedly used the formula herself.  She intends an expanded and reformed development assistance to be one of her legacies as Secretary of State, but just who controls that policy and what it looks like is what is in dispute.  In her first address to State Department career staff Secretary Clinton announced:  “we own two of the three D’s”, which created alarm through the U.S. development community as it implied a State takeover of USAID and a general subordination of development for strategic purposes.   The ten-month delay in the White House selecting a candidate for the Administrator of USAID only added to the general sense of unease in the development community that the Obama administration policy on development was in flux with a fight brewing over the future.  This delay was also a reflection of potential candidates withdrawing themselves from consideration when they did not get clarity over what policy or budget authority the USAID Administrator would have nor to whom the Administrator would report.

Secretary Clinton has kept in place the aid architecture designed by Secretary Rice which centralized control over all State and USAID policy and budgeting in a new directorate of foreign aid in the State Department.  Under the Rice structure the USAID Administrator was “duel-hatted” also serving as a second Deputy Secretary of State (now called “for Management and Resources”) with control over most aid funding.  State Department career officers were sent into training programs to learn USAID program management systems which caused resentment in State that it was being transformed into an USAID-like institution, while USAID saw this as a step towards State Department takeover of USAID.   State has accelerated the merging USAID business systems into those of the State Department and Embassies abroad so that they have much tighter control over all aspects of aid operations.

Secretary Clinton has continued and expanded Rice’s effort to increase the size of the USAID workforce which had declined by 40 percent between 1980 and 2002. The first two Obama budgets have substantially increased aid funding particularly for food security and agriculture, though these aid increases are now falling victim to the growing public revulsion against the size of the federal budget deficit.  Congress is reportedly now cutting the Obama aid budget well below what the President proposed.

Three major aid architectural decisions have thus far been made by the Obama administration, which have further weakened USAID institutionally.  First, the USAID Administrator no longer also serves as Deputy Secretary of State for Resources:  a former Office of Management and the Budget (OMB) Director with no development experience, Jack Lew, was appointed to that position instead (it was recently announced that he will be leaving State and returning to OMB).  Secondly, State has been representing development policy at meetings of the National Security Council, instead of USAID.  Thirdly, the Obama administration has also announced it intends to pursue a “whole of government approach” which will spend aid funds through “aid centers of excellence” in domestic agencies such as the U.S. Department of Agriculture, rather than exclusively through USAID.

Both members of Congress—Senator John Kerry (D-Massachusetts) and Senator Richard Lugar (R-Indiana) —and development professionals have seen this as an effort by the State Department to weaken USAID’s authority over the implementation of aid programs in the field by providing other options if USAID resists State controls.  In the 1960s and 1970s USAID itself implemented many development projects through domestic U.S. government agencies, a practice which was phased out in the 1980s because of a high project failure rate, interest group interference, and resistance to good development practice:  domestic departments tend to be controlled by special interest groups and congressional oversight committees with little development knowledge or experience. For example, the U.S. Department of Agriculture has been historically hostile to aid programs abroad which might compete with U.S. farmers and oversees a $20 billion U.S. farm subsidy program which damages developing country agriculture.

Meanwhile, two other Washington debates have been taking place over U.S. aid policy.  First, Congress has proposed legislation with bipartisan support to strengthen USAID, increase the size of the career staff, restore its independent budget authority and improve its capacity to evaluate its programs, and centralize aid programming in the Agency rather than dispersing it among 20 domestic agencies (the inverse of the whole of government approach).  This has put Congress at odds with the State Department which has tried to stop the legislation.  Second, dueling policy documents are now being circulated in the executive branch on aid policy reform—one by President Obama’s staff (which resembles the Congressional legislation) and the other by Secretary Clinton’s staff (which reflects the gradual absorption of USAID into State).  In a recent meeting at the White House much of the State proposal was overruled, though the debate is by no means over.  For example, Congressional and White House opposition put a stop to a State Department plan to transfer emergency humanitarian program offices from USAID to State.

Historically, Washington beltway disputes of this sort usually ensure policy paralysis as clashing interests trump each other.  This is now what is happening.  Absent direct, personal intervention by President Obama to define his own vision of aid reform and to take the actions needed to enforce the reforms, the stalemate will continue, and plans to strengthen the third D will suffer.  In the absence of a robust and institutionally independent foreign aid program underpinned by a strategy for U.S. foreign assistance, the United States will be unable to lead and strengthen global and transatlantic development partnerships, which are so critical to our success in spurring economic growth and poverty alleviation. The State Department takeover of foreign aid programs has been slowed temporarily, but not stopped and the three Ds of the instruments of national power increasingly look like two Ds—Defense and Diplomacy—with development a well funded, marginalized, appendage to the other two.  Good development theory and practice will be compromised as a result.

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