Summary: The United States channels its foreign aid to developing countries through a variety of assistance organizations. To some extent, a concerted integrated development effort focused on the priority needs of developing third world countries has not been achieved. GAO performed a case study assessing the nature and extent of foreign donor and recipient cooperation in the agricultural development of Indonesia. Much of the U.S. assistance to Indonesia for the past 10 years has been aimed at developing the country's long-term food production potential and reducing its dependence on imported rice. Setting specific priorities has been difficult because the country's problems are complex, facts are often uncertain, and appropriate strategies are not always apparent.
GAO found that none of the necessary coordination arrangements has operated effectively. Foreign donors recognize the Indonesian Government's responsibility for formulating its own development plans. However, the government planning agency has not fulfilled its responsibilities for assistance coordination on a sector basis. Opportunities for donor/host-government discussion and analysis of agricultural aid programs have been limited. U.S. officials have advocated a stronger leadership role for the World Bank, but the Bank has not assumed this role because of opposition from some bilateral donors. Weak coordination has resulted in the lack of a focused and concerted donor effort; independent donor efforts seldom interrelate or reinforce each other.
