World Hope International
Non Profit

John Lyon, president and CEO of World Hope International, featured in Devex

Opinion: The US needs to invest foreign aid dollars in smaller NGOs
World Hope International deliver food relief in Ebola-affected communities in Sierra Leone. Photo from WHI video

Last month, U.S. Republican congressional House members released a budget that proposes a gradual reduction in spending on domestic programs and foreign aid from $511 billion to $424 billion through 2027. This is marginally better for global health programs that aid poor countries compared to President Donald Trump’s 2018 proposed budget, which calls for cutting about 32 percent from foreign aid budgets, or nearly $19 billion in total. 

However, I believe the real tangible overhaul opportunity presented in this proposal lays in the opportunity to make important and necessary reforms to U.S. foreign assistance — reforms that could not only have a significant impact on budget savings, but also a significant impact on the world’s most vulnerable populations. 

As President Trump stated, “Poverty, unemployment and hunger around the world have a destabilizing effect that threaten international peace and security.” Poor countries are more vulnerable to disease outbreaks, famine and war. Helping poor nations fight poverty keeps the effects of this poverty from visiting American shores.  

With a smaller budget, government spending overseas must be much more focused across aid organizations. The current model that primarily turns over U.S. foreign assistance funding to only a few large organizations misses the mark. We now need to be able to do more with less. And while I would never advocate for funding to be taken away from any organization, my hope is that the budget reform will provide an opportunity for the U.S. government to not only focus its foreign assistance efforts, but to expand the type of organizations that are funded. Federal funding needs to move beyond its exclusivity with large NGOs and instead include small and medium-sized, relationship-rich organizations that have traditionally not been funded. 

Development efforts are most effective when organizations have deep roots in the countries where they work — this is a primary differentiator for small and medium-sized nonprofits. These organizations rely heavily on their local relationships to make a difference. This is important because complex cultural traditions contribute significantly to poverty around the world. Challenging these cultural norms requires deeply ingrained organizations that have relationships with built-in trust with local people. Entering a country without these relationships is much less effective and in fact is more likely to backfire. 

For example, during the 2014 Ebola outbreak in West Africa, cultural traditions in how the local populations buried the dead were a contributing factor in how the disease was spread. Governments enacted laws aimed at stopping people from burying their dead, but these laws did not work because there was a high level of distrust in the government. Large foreign aid groups then sent outsiders into the region to train people on safe burial practices, but there was a high level of distrust toward strangers, and again, cultural behavior did not change. Local populations rejected the aid workers and the assistance they were trying to provide.  

Trust was needed to change cultural traditions contributing to Ebola’s spread, and that’s where relationship-rich organizations were most effective during the Ebola crisis. These organizations are a part of local society, and became the cultural liaisons needed to end the outbreak. As on-the-ground experts, the staff of these smaller organizations had a deep understanding of the local issues perpetuating the spread of Ebola, namely the population’s traditional beliefs in how they handle the dead. Once governments and large nonprofits funded small organizations that had the trust of local communities, these relationship-rich organizations were able to serve as cultural liaisons to Ebola-affected communities, mobilize education and prevention efforts, and change the way local people handled their dead, thereby curbing further spread of the disease, and eventually helping the country become Ebola-free. 

This example demonstrates that while governments and large nonprofits have roles in providing foreign assistance, it is actually the small to medium-sized development organizations that most effectively mobilize change through their local relationships. Other donor countries already recognize this fact when allocating government funds. 

For example, UK Aid has two programs that are focused only on small to medium-sized nonprofits: UK Aid Direct and UK Aid Match. UK Aid Direct funds British small and medium-sized national and international nonprofits to reach the most marginalized and vulnerable populations. UK Aid Match awards partial grants that require British small and medium-sized nonprofits to fundraise a given amount, which will be matched by a grant. Both of these models are effective in promoting innovation while making the most of government assistance by leveraging that assistance with private charitable giving. 

More importantly, these programs don’t take funding from larger organizations. Instead, they ensure a multifaceted approach to foreign aid that allows for maximum efficiency. This approach has actually worked for the U.S. before. The New Partners Initiative was created as part of President George W. Bush’s Emergency Plan for AIDS Relief. This historic program reserved $200 million of his $15 billion PEPFAR budget for community and church groups that were not the normal recipients of public U.S. foreign assistance. The goal was to use these groups to penetrate hard-to-reach corners of PEPFAR’s target countries and enlist local, relationship-rich religious groups with deep ties at the community level. It worked! 

At the conclusion of the program in 2012, NPI partners had reached millions of people in rural areas with HIV prevention education, prenatal and counseling services and HIV testing. Above all, the NPI program helped to forge strong relationships with the communities where the partners worked, helping sustain the progress that had already been made. 

Poverty is a complex problem. It’s at the root of many issues faced by developing countries. This is one reason why so many aid groups dedicate their time, talents and resources to fighting poverty in many ways. There is no “cookie cutter” method to fighting it effectively. While large, resource-rich aid organizations and social entrepreneurs use their assets as a catalyst for change in broader terms, smaller, more focused, relationship-rich organizations with their ability to change cultural behaviors have the greatest impact at the grassroots level. 

As such, I implore our lawmakers and our president to rethink not only how much the U.S. will fund overseas, but how those funds will be allocated. 

Read more international development news online, and subscribe to The Development Newswire to receive the latest from the world’s leading donors and decision-makers — emailed to you free every business day.