The Trump Administration has signaled that it would like to shut down USAID and absorb its programs into the State Department. That proposal should involve Congress directly, as USAID is an independent agency established under legislation. And lawmakers might want to consult the international record regarding mergers between development and foreign offices before they make a decision.
Ian Mitchell looked at the record of mergers from Australia, Denmark, and Canada at the time a merger was being proposed between the UK’s Department for International Development (DFID) and the Foreign and Commonwealth Office. His conclusion:
“If the government has sound and progressive development policies, these can be enhanced by the joined up decision-making that follows from a merger (as in the case of Denmark which retained the identity of ‘Danida’ and has a cabinet-level Minister). But if the goal of a merger is to demote development as a policy objective, and make it subservient to trade and foreign policies, then unsurprisingly this will diminish the effectiveness of development policy…. The Institute for Government point out that so-called ‘machinery of Government’ changes are costly and disruptive and often undertaken hastily and with political motivations.”
That was, sadly, how it turned out in the case of the UK’s merged Foreign, Commonwealth and Development Office (FCDO). Mark Lowcock and Ranil Dissanayake’s history relates that:
“DFID had for many years been praised – ….by independent reviews … parliamentary committees, and by its international peers – for both its systems and its expertise. The merger simultaneously destroyed the systems and triggered a drastic loss of expertise. Many capable and experienced staff either left completely or moved to other roles in which they thought they would be valued more… attempts to recruit people with the necessary technical skills were still failing in early 2024…. The FCDO’s internal auditors have raised warning flags over the number of core systems which are now either not fit for purpose in the way they are designed or are being systematically ignored.”
Rachael Calleja and Jürgen Zattler re-examined the merger history when a proposal was mooted for Germany. They cited an ODI report on the cross-country experience which suggests:
“…integrating development within a foreign ministry, and giving ministers responsibilities for development alongside other portfolios, is associated with lower scores on commitment to development and principled national interest metrics, administrative efficiency, aid quantity and soft power.”
Calleja and Zattler also note:
“…in Australia, up to 2000 years of development expertise was lost following the merger, undermining the long-term quality of development activities, and weakening global country networks and relationships that support diplomacy… in the Canadian case, merging cultures was seen to take between five to ten years.”
In short, the lesson of past mergers between aid and foreign offices is: “don’t do it.” The second lesson: “if you do it anyway, don’t do it as a rushed political decision.” That’s not so reassuring for the future quality of US foreign assistance if it is absorbed into the State Department.
CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise.
CGD is a nonpartisan, independent organization and does not take institutional positions.
