Foreign Assistance: U.S. Funding for Democracy-Related Programs (China).

GAO-04-445R February 27, 2004

In fiscal year 1999, Congress began authorizing the provision of U.S. foreign assistance funds to support programs aimed at strengthening democracy in China, and, in fiscal year 2002, it began appropriating specific amounts for such programs. However, the

provision of foreign assistance funds to programs focusing on China continues to be controversial due to concern about some of the Chinese government's human rights practices and certain of its economic, political, and security policies. The House Committee on International Relations expressed concern about the lack of a complete picture of U.S. funding for democracy-related programs focused on China. In response to this concern, we determined how much funding the U.S. government has provided for programs intended to strengthen democracy in China for fiscal years 1999 to 2003, in total and by year, and identified the agencies responsible for administering the funds, as well as the intended purposes of the programs they support. While we focused primarily on bilateral programs, we also briefly describe democracy-related efforts of multilateral institutions that the United States helps support.

In fiscal years 1999 to 2003, the United States provided more than $39 million in bilateral support for programs intended to strengthen democracy in China, with average annual funding levels increasing from about $2.3 million in 1999 and 2000 to about $14.4 million in 2002 and 2003. State provided about 45 percent of the total funds (nearly $18 million), primarily to support programs to enhance the rule of law. The National Endowment for Democracy provided about 38 percent of the total (more than $15 million) for programs aimed at a variety of purposes, such as strengthening labor rights and reforming electoral systems. Labor provided the remaining 17 percent ($6.4 million) to enhance protection of internationally recognized workers' rights.