List of Tables
Total U.S. Foreign Assistance to the Middle East 1950-1970
Total U.S. Assistance to the Middle East: 1971-2001
Total U.S. Assistance to the Middle East: FY2002-FY2005 Request
U.S. Funds for Iraq Reconstruction & Iraqi Opposition, FY2002-FY2005 Request
U.S. Assistance to Israel, FY2002-FY2005 Request
U.S. Assistance to Egypt, FY2002-FY2005 Request
U.S. Assistance to Jordan, FY2002-FY2005 Request
U.S. Assistance to the Palestinians, FY2002-FY2005 Request
Other Regional Recipients, FY2002-FY2005 Request
Middle East Partnership Initiative Appropriations, FY2002-FY2005 Request
This report is an overview of U.S. foreign assistance to the Middle East from FY2002 to FY2004, and of the FY2005 budget request. It includes a brief history of aid to the region, a review of foreign aid levels, a description of selected country programs, and an analysis of current foreign aid issues. It will be updated periodically to reflect recent developments.
Congress both authorizes and appropriates foreign assistance and conducts oversight of executive agencies' management of aid programs. As a region, the Middle East is the largest annual recipient of U.S. economic and military aid. With Iraq in need of long-term reconstruction assistance, many analysts expect Iraq to become a regular recipient of U.S. foreign aid once the United States has transferred sovereignty to an Iraqi national body.
For policymakers, foreign assistance plays a key role in advancing U.S. foreign policy goals in the Middle East. The United States has a number of interests in the region, ranging from support for the state of Israel and Israel's peaceful relations with its Arab neighbors, to the protection of vital petroleum supplies and the fight against international terrorism. U.S. assistance helps to maintain the 1979 Camp David peace accords between Israel and Egypt and the continued stability of the Kingdom of Jordan, which signed its own peace treaty with Israel in 1994. U.S. funding also works to improve Palestinian civil society, and aid officials have worked to ensure that U.S. aid to the West Bank and Gaza Strip is not diverted to terrorist groups. Since the attacks of September 11, 2001, the United States has established new region-wide aid programs to promote democracy and encourage socio-economic reform in order to undercut the forces of radicalism in some Arab countries.
U.S. aid policy has gradually evolved from a focus on preventing Soviet influence from gaining a foothold in the region and from maintaining a neutral stance in the Arab-Israeli conflict, to strengthening Israel's military and economy and using foreign aid as an incentive to foster peace agreements between countries in the region. When adjusted for inflation, annual U.S. assistance to the Middle East in the decades following World War II was only a small fraction of current aid flows. However, beginning in the early 1970s, the United States dramatically increased its foreign assistance to the Middle East. After the U.S. withdrawal from South Vietnam, the Middle East as a whole began to receive more U.S. foreign aid than any other region of the world, a trend that has continued to today.
For readers seeking a general overview of U.S. foreign assistance, see CRS Report 98-916, Foreign Aid: An Introductary Overview of U.S. Programs and Policy, by Larry Nowels and Curt Tarnoff. For information on the FY2004 Foreign Operations Bill, see CRS Report RL31811, Appropriations for FY2004: Foreign Operations, Export Financing, and Related Programs, by Larry Nowels. For foreign aid terminology and acronyms, please see the glossary appended to this report.
This report is an overview of U.S. foreign assistance to the Middle East from FY2002 through the FY2005 budget request. (1) It includes a brief historical review of foreign aid levels, a description of specific country programs, and an analysis of current foreign aid issues. (2) Congress both authorizes and appropriates foreign assistance and conducts oversight on executive agencies' management of aid programs. As the largest regional recipient of U.S. economic and military aid, the Middle East is perennially a major focus of interest as Congress exercises these responsibilities.
In the Middle East, the United States has a number of strategic interests, ranging from support for the state of Israel and Israel's peaceful relations with its Arab neighbors, to the protection of vital petroleum supplies and the fight against international terrorism. U.S. assistance was provided to support the 1979 Camp David peace accords between Israel and Egypt and the continued stability of the Kingdom of Jordan, which signed its own peace treaty with Israel in 1994. U.S. funding also attempts to improve Palestinian civil society, and aid officials have worked to ensure that U.S. aid to the West Bank and Gaza Strip is not diverted to terrorist groups. Since the attacks of September 11, 2001, the United States has established new region-wide aid programs that promote democracy and encourage socio-economic reform in an attempt to undercut the forces of radicalism in some Arab countries.
For readers seeking a general overview of U.S. foreign assistance, see CRS Report 98-916, Foreign Aid: An Introductary Overview of U.S. Programs and Policy, by Larry Nowels and Curt Tarnoff. For information on the FY2004 Foreign Operations Bill, see CRS Report RL31811, Appropriations for FY2004: Foreign Operations, Export Financing, and Related Programs, by Larry Nowels.
Despite changing geopolitical conditions, U.S. foreign aid to the Middle East has historically been a function of U.S. national security interests in the region. The United States has pursued a foreign policy that seeks stability in a region with abundant energy reserves but volatile interstate relationships. Policymakers have often employed foreign aid to achieve this objective. Foreign aid has been used as leverage to encourage peace between Israel and her Arab neighbors, while strengthening bilateral relationships between the United States and Israel and between the United States and moderate Arab governments. Foreign aid has worked to cement close military cooperation between the United States and governments in the region, discouraging local states from engaging in uncontrollable arms races. Economic aid also has had an underlying strategic rationale, as U.S. funds have been employed to promote development in an attempt to undercut radicalism in partner countries.
The degree to which foreign assistance has contributed to the achievement of U.S. objectives in the Middle East is difficult to measure, but the consensus among most analysts seems to be that U.S. economic and security aid has contributed significantly to Israel's security, Egypt's stability, and Jordan's friendship with the United States. The promise of U.S. assistance to Israel and Egypt during peace negotiations in the late 1970s enabled both countries to take the risks needed for peace, and may have helped convince both countries that the United States was committed to supporting their peace efforts. Excluding Iraq, Israel and Egypt are the largest two recipients of U.S. aid respectively.
There is debate over using foreign aid more aggressively to pursue various policies in the Middle East. Some critics of U.S. policy would like to see additional conditions placed on U.S. aid to Egypt, for example, to achieve greater respect for democracy and human rights in that country. Others favor using the aid program more assertively as leverage to restart the Middle East peace process. Some might urge that aid should be conditioned on demonstrable progress in extending full political and economic rights to women. The Bush Administration, in conjunction with international partners, is reportedly considering a plan to encourage democracy in the "greater Middle East." Part of this plan may involve tying the delivery of U.S. foreign aid to recipient countries' participation in a reform process, similar to the objectives of the Millennium Challenge Account. (3) Others, however, assert that the overt use of aid -- or the threat of aid reductions -- to promote democracy and reform in the Middle East region could lead to a backlash against the United States. The debate over a greater Middle East initiative will likely be vigorous.
Critics of U.S. aid policy, particularly some in the Middle East, have argued that U.S. foreign aid exacerbates tensions in the region. Many Arab commentators insist that U.S. assistance to Israel indirectly causes suffering to Palestinians by supporting Israeli arms purchases. Another common argument asserts that U.S. foreign aid bolsters autocratic regimes with similar strategic interests to the United States. Some observers have called U.S. aid policy "contradictory," accusing the United States of bolstering its ties with autocratic regimes through military assistance, while advocating liberalization in the region with less funds dedicated to reform and development aid. As noted above, however, other analysts believe aid has helped protect Israel's security and stabilize the region.
1950-1970. Even when adjusted for inflation, annual U.S. assistance to the Middle East in the decades following World War II was only a small fraction of current aid flows to the region. Under vastly different geopolitical circumstances, U.S. policy was geared toward supporting the development of oil-producing countries, maintaining a neutral stance in the Arab-Israeli conflict, and preventing Soviet influence from gaining a foothold in Iran. U.S. policymakers used foreign aid in the 1950s and 1960s to support these objectives.
U.S. aid to Israel was far less in the 1950s and 1960s than in later years. (4) Although the United States provided moderate amounts of economic aid (mostly loans) to Israel, at the time, Israel's main patron was France, which supported Israel by providing it with advanced military equipment and technology. (5) In 1962, Israel purchased its first advanced weapons system from the United States (Hawk antiaircraft missiles). (6) In 1968, a year after Israel's victory in the Six Day War, the Johnson Administration, with strong support from Congress, approved the sale of Phantom fighters to Israel, establishing the precedent for U.S. support for Israel's qualitative military edge over its neighbors. (7)
Between 1950 and 1970, the United States frequently courted Egypt using foreign aid as a bargaining chip. Cold War competition for Egypt was fierce during this time period, as Egypt received a steady stream of surplus U.S. wheat shipments under the Food for Peace Program (P.L.480). Despite these measures, offers of additional economic aid failed to convince Egypt to abandon a parallel relationship with the Soviet Union, as Egypt pursued a strict Arab nationalist and neutral policy that shunned close alliances with Western powers and cooperation and peace with Israel. Internationally, after 1955, Egypt obtained military aid mainly from the Soviet Union.
Beginning in 1965, foreign assistance levels to the region began to decline considerably, culminating in an almost 80% drop in economic aid to the Middle East by 1970. A host of factors, most notably the June 1967 War and the rising cost of the war in Vietnam, led Congress to cut funding for a number of countries. Egypt, which had already seen its annual aid reduced, lost food aid entirely after it severed relations with the United States during the 1967 War. Jordan and other Arab states also saw their aid reduced. By 1970, annual appropriations to Iran were close to being phased out, as many policymakers considered Iran to be a middle-income state that was economically self-sufficient.
Total U.S. Foreign Assistance to the Middle East
1950-1970
(Loans & Grants; Current Year $ in millions)
| Country/Region | Economic | Military | Total |
| Iran | $750.9 | $1,396.7 | $2,147.6 |
| Israel | $986.0 | $277.3 | $1,263.3 |
| Egypt | $884.1 | 0.0 | $884.1 |
| Jordan | $601.0 | $95.0 | $696.0 |
| Libya | $220.6 | $17.4 | $238.0 |
| Lebanon | $111.0 | $9.6 | $120.6 |
| Iraq | $45.2 | $50.0 | $95.2 |
| Total Near East (including other recipients not listed) | $5,610.4 | $2,244.4 | $7,854.8 |
Source: U.S. Agency for International Development (USAID), Overseas Loans and Grants, Obligations and Loan Authorizations July 1, 1945 - September 30, 2001. The report is commonly known at USAID as "The Greenbook."
1971-2001. The decade of the 1970s witnessed a dramatic increase in U.S. foreign assistance to the Middle East. After the U.S. withdrawal from South Vietnam, the Middle East as a whole began to receive more U.S. foreign aid than any other region of the world, a trend that has continued to today. U.S. foreign aid programs became more comprehensive in nature driven by large assistance packages to Israel and later to Egypt and other Arab governments.
Large-scale U.S. assistance for Israel increased considerably after a series of Arab-Israeli wars created a sense among many Americans that Israel was continually under siege. (8) Consequently, Congress, supported by broad U.S. public opinion, committed to strengthening Israel's military and economy through large increases in foreign aid. In 1971, the United States provided Israel with military loans of $545 million, up from $30 million in 1970. Also in 1971, Congress first designated a specific amount of aid for Israel (an "earmark"). Economic assistance changed from project aid, such as support for agricultural development work, to the Commodity Import Program (CIP) for the purchase of U.S. goods. (9) In effect, the United States stepped in to fill the role that France had relinquished after French President Charles De Gaulle refused to supply Israel with military hardware to protest its preemptive launch of the June 1967 War. Israel became the largest recipient of U.S. foreign assistance in 1976. From 1971 to the present, U.S. aid to Israel has averaged over $2 billion per year, two-thirds of which has been military assistance.
Just as Israel's long-standing relationship with the United States was in its incipient stages, Egypt, its economy in desperate need of investment and capital after two wars, began to look to the United States to help stimulate economic growth. Egypt's new leader, Anwar Sadat, who had been eager to rid Egypt of excessive Soviet influence and embark on a program of economic liberalization, improved U.S.-Egyptian relations in the mid 1970s, leading to a resumption in economic aid in 1975, and the signing of two disengagement agreements with Israel concerning the Sinai desert. To a lesser extent, the United States significantly increased its economic and military aid to Jordan after the 1970-1971 civil war, in which the Jordanian Armed Forces expelled Palestinian guerrillas from Jordan where they had seriously threatened stability.
The 1979 Camp David Peace Treaty between Israel and Egypt ushered in the current era of U.S. financial support for peace between Israel and her Arab neighbors. In exchange for a complete cessation of hostilities and Israel's return of the Sinai Peninsula, the United States provided a total of $7.5 billion to both parties in 1979. The "Special International Security Assistance Act of 1979" (P.L.96-35) provided both military and economic grants to Israel and Egypt at a ratio of 3 to 2, respectively. (10) From the Egyptian standpoint, U.S. funds helped to subsidize its bloated defense budget and upgrade its aging Soviet hardware. Egypt became the second largest recipient of U.S. aid after 1979.
Since the Camp David Accords, U.S. assistance levels have remained relatively consistent, and the United States has continued to support the peace process and the strengthening of Israel. Israel, Egypt, and Jordan have been the top three regional recipients of U.S. aid for more than two decades. Notable events involving significant transfers of U.S. aid since the 1979 Camp David Accords include the following:
Total U.S. Assistance to the Middle East:
1971-2001
(Loans & Grants; Current Year $ in millions)
| Country/Region | Economic | Military | Total |
| Israel | $28,402.9 | $50,505.7 | $78,908.6 |
| Egypt | $25,095.8 | $27,607.0 | $52,702.8 |
| Jordan | $2,440.1 | $2,137.2 | $4,577.3 |
| Lebanon | $470.5 | $273.7 | $744.2 |
| Palestinians | $703.4 | $0.0 | $703.4 |
| Syria | $539.0 | $0.0 | $539.0 |
| Total Near East (including other recipients not listed) | $62,449.8 | $82,519.2 | $144,969.0 |
Source: U.S. Agency for International Development (USAID), Overseas Loans and Grants, Obligations and Loan Authorizations July 1, 1945 - September 30, 2001. The report is commonly known at USAID as "The Greenbook."
In the past five years, overall U.S. assistance to Middle Eastern countries has increased moderately (excluding funds for Iraq reconstruction). (14) This increase has largely been a result of U.S. contributions to regional partners in the war on terror, U.S. commitments to regional participants in the now-defunct peace process, (15) U.S. assistance to the struggling Israeli economy, (16) and U.S. support for new development and democracy-promotion programs in the Middle East. The FY2003 Emergency Supplemental Appropriations Act (P.L. 108-11) was the primary funding vehicle for recent increases, as subsequent spending proposals have reverted to previous funding patterns.
Additional assistance for Israel and Egypt, which receive almost 93% of all annual funding to the region, has fueled the increase in aid to the Middle East over the last several years. Before the recent rise in Arab-Israeli violence, the September 11, 2001 terrorist attacks, and the Iraq war, annual aid to Israel and Egypt was trending downward. (17) However, the FY2003 Emergency Supplemental Appropriations Act (P.L. 108-11) included $9 billion in loan guarantees over three years for Israel's economic recovery and $1 billion in military grants. For Egypt, the United States agreed to allow $655 million in FY2002 economic aid to be redistributed to help Egypt recover from a steep drop in tourism after 9/11. (18) The FY2003 Supplemental Act also allocated an additional $300 million in Economic Support Funds (ESF) and $2 billion in loan guarantees for Egypt.
Although aid to Israel and Egypt accounts for most aid to the region, for some smaller Arab states, recent increases have been significant. For example, the Kingdom of Jordan, which had already seen steady increases in aid throughout the late 1990s, received an annual average of $790 million in economic and military aid between FY2002 and FY2004 (including supplemental funding), up from an average of $246 million per year between FY1996 and FY2001. With U.S. forces in Iraq and Afghanistan, other Persian Gulf countries have arguably become of greater strategic importance to U.S. policy in the region and in the war on terror. Aid to Oman, which was $500,000 in FY2001, has totaled $106 million in military grants from FY2002-FY2004. The FY2005 request seeks $25 million in FMF for Oman. Another Gulf monarchy, Bahrain, has had its assistance increased from $200,000 in 2001 to $118 million in the last two years. The FY2005 budget request would more than double aid to Morocco and would be almost four times as large as its aid package in FY2002. U.S. officials have praised Morocco for undertaking political and economic reforms and have pledged to assist the Moroccan government in combating terrorism.
Total U.S. Assistance to the Middle East:
FY2002-FY2005 Request
(Regular & Supplemental Appropriations; (Current Year $ in millions)
| Near East Region | FY2002 Actual | FY2003 Actual | FY2004 Estimate | FY2005 Request |
Totals |
$5,567.810 | $8,410.000 | $5,552.000 | $5,482.000 |
When including funds for Iraq Reconstruction:
| Near East Region | FY2002 Actual | FY2003 Actual | FY2004 Estimate | FY2005 Request |
| Totals w/Iraq | $5,567.810 | $10,646.000 | $23,991.000 | $5,482.000 |
The following section provides funding details on the four largest regular aid recipients in the Middle East: Israel, Egypt, Jordan, and the Palestinians. An Iraq section is included, though other CRS products explore Iraq reconstruction appropriations in greater detail. (19) Each country section features a table with a more elaborate breakdown of aid by foreign aid account.
Without an internationally recognized sovereign government to conduct formal diplomatic relations, assistance for Iraq does not conform to traditional procedures for providing foreign aid. However, with the planned transfer of sovereignty to an Iraqi national body scheduled for June 30, 2004, observers expect the United States to open a permanent U.S. embassy in Baghdad with facilities for USAID personnel to oversee reconstruction activities. With Iraq in need of long term development assistance, many analysts expect Iraq to become a regular recipient of U.S. foreign aid at levels rivaling annual funding to Israel and Egypt in the near term.
U.S. Funds for Iraq Reconstruction & Iraqi
Opposition, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| FY2002 Actual | FY2003 Actual | FY2004 Estimate |
FY2005 Request | |
| Iraqi Opposition | $25.000 | $10.000 | - | - |
| Iraqi Relief and Reconstruction Fund | - | $2,475.000 | $18,439.000 | - |
| DOD | - | $1,445.000* | $983.000* | - |
| Other Agencies | - | $581.300** | $1.900*** | - |
| Total | $25.000 | $4,511.300 | $19,423.900 | - |
Source: CRS Report RL31833, Iraq: Recent Developments in Reconstruction Assistance, by Curt Tarnoff.
*Includes defense department spending on oil infrastructure repair, cost of the CPA, and funds for rebuilding the Iraqi army.
**Includes USAID and Department of State spending in Iraq.
***USAID Inspector General Office
Appropriations to fund the reconstruction of Iraq have come from supplemental budget allocations that are deposited in the Iraq Relief and Reconstruction Fund (IRRF), a catch-all development and security account controlled by the President. Funds from the IRRF go directly to the Coalition Provisional Authority (CPA), which reports to the Secretary of Defense, and may be transferred to the Department of State, USAID, the Department of the Treasury, the Department of Defense, and the Department of Health and Human Services, subject to the usual notification procedures.
Overview. Since 1976, Israel has been the largest annual recipient of U.S. foreign assistance and is the largest cumulative recipient since World War II. Strong congressional support for Israel has resulted in Israel's receiving benefits that may not be available to other countries. For example, Israel can use U.S. military assistance for research and development in the United States and for military purchases in Israel. (21) In addition, all foreign assistance earmarked for Israel is delivered in the first 30 days of the fiscal year. Other recipients normally receive their aid in staggered installments at varying times. The United States gives all Economic Support Funds (ESF) directly to the government of Israel as a grant cash transfer rather than allocating funds for specific development projects. (22)
Economic Assistance. Former Israeli Prime Minister Binyamin Netanyahu told Congress on July 10, 1996, that Israel would end its dependency on U.S. economic assistance. At the time, Israel was receiving $1.2 billion in grant economic assistance and $1.8 billion in grant military assistance. In 1998, Israel and the United States agreed to reduce U.S. economic assistance by $120 million per year and increase U.S. military assistance by $60 million per year over a 10-year period beginning in 1999. (23) Israel received $480 million in ESF for FY2004, down from $596 million in FY2003. The FY2005 request designates $360 million in ESF for Israel.
Military Assistance. Congress has taken measures to strengthen Israel's security and maintain its technological advantage over neighboring militaries. Annual Foreign Military Financing (FMF) grants to Israel represent about 20% of the Israeli defense budget and FMF levels are expected to increase incrementally by $60 million a year to a level of $2.4 billion by 2008. (24) Israel also is eligible to receive Excess Defense Articles under section 516 of the Foreign Assistance Act. The FY2005 budget requests $2.22 billion in FMF for Israel.
Since FY1988, Congress has allowed Israel to use approximately a quarter of its FMF funds to pay for Israeli defense purchases in Israel ($568 million for FY2004). Since 1990, Congress has provided for Israel to receive its FMF aid in a lump sum during the first month of the fiscal year, which allows Israel to invest the funds in U.S. Treasury notes and earn interest similar to ESF early disbursements.
Other Assistance. The FY2003 Emergency Supplemental Appropriations Act (P.L. 108-11) provided $9 billion in loan guarantees for Israel. On November 26, 2003, the United States announced that the first tranche of $3 billion in loan guarantees would be reduced by $289.5 million because of Israeli settlement activity and the continued construction of the security barrier through Palestinian areas beyond Israel's 1967 border.
U.S. Assistance to Israel, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| Account | FY2002 Actual |
FY2003 Actual |
FY2004 Estimate | FY2005 Request |
| ESF | $720.000 | $596.100 | $477.168 | $360.000 |
| FMF | $2,040.000 | $3,086.350 | $2,147.255 | $2,220.000 |
| Refugees | $60.000 | $60.000 | $50.000 | $50.000 |
| Other* | $28.000 | - | - | - |
| Total | $2,848.000 | $3,742.450** | $2,674.423 | $2,630.000 |
Source: U.S. State Department
*This category includes funds for counter terrorism, border control, and technical cooperation.
** This figure does not include $9 billion in U.S. loan guarantees.
Overview. Since 1979, Egypt has been the second largest recipient of U.S. foreign assistance, receiving an annual average of over $2 billion in economic and military aid. Congress typically earmarks foreign assistance for Egypt in the Foreign Operations Appropriations bill. The annual earmark includes a statement that Egypt should undertake economic further reforms in addition to reforms taken in previous years.
Economic Assistance. In January 1998, Israeli officials negotiated with the United States to reduce economic aid and increase military aid over a 10-year period. A similar formula for reducing economic aid was applied to Egypt (at a 3 to 2 ratio with Israel), but Egypt did not receive an increase in military assistance. Economic aid has dropped in annual $40 million increments from $815 million in FY1998 to $575 million for FY2004. The FY2005 budget requests $535 million in ESF for Egypt. In FY2005, $200 million in ESF is proposed for the Commodity Import Program (CIP), which provides hard currency for the Egyptian private sector to import U.S. goods.
In early January 2002, the United States agreed to accelerate Egypt's aid delivery, releasing $655 million in FY2002 ESF and $304 million in the foreign aid "pipeline" to help Egypt overcome economic problems exacerbated by the fall in tourism after September 11, 2001. The FY2003 Emergency Supplemental Appropriations Act (P.L. 108-11) included $300 million in ESF for Egypt, which could be used to cover the costs of up to $2 billion in loan guarantees. The loan guarantees are to be issued over three years.
Military Assistance. The FY2005 budget requests $1.3 billion in FMF for Egypt -- the same amount it received in FY2004. Almost all of Egypt's FMF is committed to payments on a $3.2 billion arms agreement with the United States, through which Egypt purchased 24 F-16 aircraft, 200 M-1 tanks, and a Patriot missile battery. Egypt also receives excess defense articles worth hundreds of millions of dollars annually from the Pentagon.
U.S. Assistance to Egypt, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| Account | FY2002 Actual | FY2003 Actual |
FY2004 Estimate | FY2005 Request |
| ESF | $655.000 | $911.002* | $571.608 | $535.000 |
| FMF | $1,300.000 | $1,291.550 | $1,292.330 | $1,300.000 |
| IMET | $1.217 | $1.232 | $1.200 | $1.200 |
| P.L.480 Title II | $3.839 | $2.347 | - | - |
| Total | $1,960.056 | $2,206.131 | $1,865.138 | $1,836.200 |
Source: U.S. State Department
*$300 million of which could be used to draw on $2 billion in loan guarantees.
Overview. The United States has markedly increased aid to Jordan since the mid-1990s to help Jordan strengthen its economy, maintain domestic stability, and pursue normalization of its relations with Israel. Between FY1998 and FY2002, annual U.S. economic and military aid levels to Jordan were approximately $150 million and $75 million, respectively. Further increases in U.S. aid to Jordan began in FY2003, in view of Jordan's support for the war against terrorism. Since FY2003, Jordan's total assistance package has averaged over $800 million per fiscal year. This higher figure is due in part to large allocations for Jordan in the FY2003 Emergency Supplemental Appropriations Act (P.L. 108-11).
Economic Assistance. The Bush Administration requested supplemental funding in FY2002 for a number of countries which support the U.S. effort in the war on terrorism. As part of supplemental funds requested by the Administration, Jordan received $100 million in ESF funds in addition to the $150 million in appropriations from the FY2002 Foreign Operations Act (P.L. 107-115). The following year, Jordan received an additional supplemental ESF grant of $700 million, on top of the $250 million in ESF grants from the FY2003 Consolidated Appropriations Resolution (P.L. 108-7). For FY2004, Jordan was granted $100 million in economic aid from the Iraq Reconstruction Relief Funds Supplemental (P.L. 108-106) for its participation in training new Iraqi police forces. Under the FY2004 Consolidated Appropriations Act (P.L. 108-199), Jordan received $250 million in regular ESF for FY2004 - the same amount requested in the President's FY2005 budget.
Military Assistance. Jordan has received four separate grants of FMF funds in the last two fiscal years: $75 million from FY2002 Foreign Operations Act (P.L. 107-115), $25 million from FY2002 Supplemental (P.L. 107-206), $198 million under the FY2003 Consolidated Appropriations Resolution (P.L. 108-7), and $406 million from the Emergency Wartime Supplemental Appropriations Act (P.L. 108-11). Under the FY2004 Consolidated Appropriations Act (P.L. 108-199), Jordan received $206 million in FMF funds for FY2004 - the same amount requested in the President's FY2005 budget. Jordan is eligible in FY2005 to receive U.S. Excess Defense Articles (EDA) under section 516 of the Foreign Assistance Act.
U.S. Assistance to Jordan, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| Account | FY2002 Actual | FY2003 Actual | FY2004 Estimate | FY2005 Request |
| ESF | $250.000 | $948.000 | $348.525 | $250.000 |
| FMF | $100.000 | $604.000 | $204.785 | $206.000 |
| IMET | $2.012 | $2.400 | $2.900 | $3.000 |
| Total | $352.012 | $1,554.400 | $556.210 | $459.000 |
Source: U.S. State Department
Note: This table does not include NADR/EXBS funds or peace corps funds.
Overview. Since the signing of the Oslo Accord in 1993, the U.S. government has committed more than $1.4 billion in economic assistance to the Palestinians. (27) Approximately 80% of U.S. funding for the Palestinians has been channeled through USAID contractors and 20% through private voluntary organizations (PVOs). According to Section 552 of the annual Foreign Operations Appropriations Act, congressionally approved funds for the West Bank and Gaza Strip cannot be used for the Palestinian Authority (PA), unless the President submits a waiver to Congress citing that it is in the interest of national security. (28) The United States has provided direct assistance to the Palestinian Authority on only two occasions. In1993-1994, the United States provided $36 million through the Holst Fund at the World Bank for direct assistance to the Palestinian Authority, and an additional $5 million in cash and equipment for the Palestinian police. From 1995-2002, no U.S. assistance went to the Palestinian Authority or any of its constituent bodies. On July 8, 2003, the United States announced that it would provide $20 million out of a $50 million FY2003 Supplemental allocation as direct aid to the PA for infrastructure projects. (29) Regular U.S. assistance to the Palestinians has been averaging about $75 million per year since the Oslo accords in the early 1990s.
Economic Assistance. There is no current congressional earmark for economic aid to the Palestinians. In FY2003, the Palestinians received a total of $125 million, $75 million from regular appropriations and $50 million from the Emergency Wartime Supplemental Appropriations Act (P.L. 108-11). The conference agreement (H.Rept. 108-401) on H.R. 2673, the FY2004 omnibus spending bill (P.L. 108-199), designates $75 million in ESF grants - the same amount requested by the President for FY2005.
Other Assistance. The United Nations Relief and Works Agency (UNRWA) provides food, shelter, medical care, and education for many of the three million Palestinian refugees from the 1948-1949 Arab-Israeli war. U.S. contributions to the UNRWA are part of annual U.S. contributions to the United Nations. U.S. support for UNRWA is not treated as bilateral economic aid to the Palestinians, which is managed by USAID. U.S. contributions to UNRWA have been averaging around $80 million per year with an additional $20 million annual contribution to meet crisis needs.
U.S. Assistance to the Palestinians,
FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| Account | FY2002 Actual | FY2003 Actual |
FY2004 Estimate | FY2005 Request |
| ESF | $72.000 | $124.500 | $74.558 | $75.000 |
| P.L.480 Title II | - | $9.984 | - | - |
| Total | $72.000 | $134.484 | $74.558 | $75.000 |
Source: U.S. State Department
Excluding Israel, Egypt, Jordan, and the Palestinians, the eight remaining Middle Eastern recipients of U.S. foreign aid receive on average just 2% of the total bilateral assistance to the region. (31) The United States grants military education and training funds (IMET), which typically do not exceed more than a million dollars a year, to a number of states including Algeria and Saudi Arabia. Other wealthy states, such as Oman and Bahrain, receive modest amounts of FMF funds to upgrade weapons systems and maritime defense capabilities. The United States also provides funding to Morocco, Tunisia, and Yemen for counter-terrorism training and for the purchase of border surveillance and communications equipment. Since the U.S.S. Cole bombings in Yemen in 2000 and the September 11 attacks, each of these three countries has seen steady increases in their FMF aid.
Morocco, Lebanon, and Yemen have active USAID programs that address development challenges such as illiteracy, malnutrition, and unemployment. In Morocco, USAID is implementing job training and structural adjustment programs in anticipation of a free trade agreement. In Lebanon, with its large middle class, U.S. economic aid helps subsidize American educational institutions like the American University of Beirut. In Yemen, one of the world's poorest and fastest growing countries, USAID is focusing economic aid on Yemen's five most remote and rural governorates in the hopes of improving underlying socio-economic conditions.
Other Regional Recipients, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| Country/Account | FY2002 Actual | FY2003 Actual | FY2004 Estimate | FY2005 Request |
| Algeria (IMET) | $.067 | $.612 | $.550 | $.850 |
| Bahrain Total | $28.895 | $90.448 | $25.450 | $20.650 |
| FMF | $28.500 | $90.000 | $24.850 | $20.000 |
| IMET | $.395 | $.448 | $.600 | $.650 |
| Lebanon Total | $36.168 | $35.470 | $35.894 | $32.700 |
| ESF | $35.000 | $34.770 | $34.794 | $32.000 |
| DA | $.600 | - | $.400 | - |
| IMET | $.568 | $.700 | $.700 | $.700 |
| Morocco Total | $10.307 | $13.119 | $17.090 | $47.875 |
| ESF | - | - | - | $20.000 |
| FMF | $3.500 | $4.900 | $9.940 | $20.000 |
| DA | $5.766 | $6.644 | $5.400 | $6.000 |
| IMET | $1.041 | $1.575 | $1.750 | $1.875 |
| Oman Total | $25.481 | $81.567 | $26.850 | $26.100 |
| FMF | $25.000 | $81.000 | $25.850 | $25.000 |
| IMET | $.481 | $.567 | $1.000 | $1.100 |
| Saudi Arabia IMET | $.024 | $.022 | $.025 | $.025 |
| Tunisia Total | $4.513 | $6.400 | $11.690 | $11.875 |
| FMF | $3.500 | $4.900 | $9.940 | $10.000 |
| IMET | $1.013 | $1.500 | $1.750 | $1.875 |
| Yemen Total | $28.488 | $14.436 | $27.342 | $36.100 |
| FMF | $20.000 | $1.900 | $14.910 | $15.000 |
| DA | - | $2.000 | - | - |
| ESF | $8.000 | $9.898 | $11.432 | $20.000 |
| IMET | $.488 | $.638 | $1.000 | $1.100 |
Restrictions on Aid to the Palestinians. Annual Foreign Operations Appropriations include several limitations on funding for Palestinian organizations and institutions. Congressionally approved funds for the West Bank and Gaza Strip cannot be used for the Palestinian Authority (PA), unless the President submits a waiver to Congress citing that it is in the interest of national security. Nevertheless, some lawmakers are concerned that a lack of transparency and overall lack of governing authority in the West Bank and Gaza Strip could indirectly lead to U.S. funds being siphoned off for use by terrorist groups or for Palestinian uprising activities. Some Palestinian leaders have accused Yasser Arafat, president of the PA, and his followers of providing funds to militant and terrorist groups, such as the Al-Aqsa Martyrs' Brigades, a military affiliate of Arafat's Fatah movement that is listed as a terrorist group by the U.S. State Department. (32) Arafat also has been accused of diverting international aid to personal accounts. An internal audit in 1996 reportedly found that some 40% of the PA's budget had been wasted or misused. (33) Some lawmakers are concerned that U.S. donations to the United Nations Refugee Works Administration (UNRWA), which has provided services to Palestinian refugees since 1948, could be used for terrorist activities. (34) In a 2002 letter to UN Secretary General Kofi Annan, Representative Tom Lantos reportedly wrote that, "it is difficult to escape the painful conclusion that UNRWA, directly or indirectly, is complicit in terrorism." (35) The United States is the largest donor to UNRWA, providing a third of its annual budget.
USAID has taken several precautions to ensure that funds for Palestinian NGOs in the West Bank and Gaza Strip are not used to support terrorism. According to a USAID factsheet on aid to the Palestinians:
U.S. law prohibits transactions with, and the provision of resources and support to, individuals and organizations associated with terrorism. USAID/WBG ensures compliance with this prohibition in several ways. First, before awarding any contract or grant to an organization, USAID/WBG reviews the list of designated individuals and organizations involved with terrorism, to ensure that the organization under consideration has not been so designated. Second, the U.S. Government reviews the organization and its key personnel for possible associations with terrorist organizations. Third, every contract and grant awarded by USAID includes a clause reminding the recipient of its legal obligation to comply with the prohibition stated above. These three measures offer a high degree of confidence that no USAID/WBG assistance is being provided to individuals or organizations involved in terrorism. (36)
In May 2002, Arafat appointed Salam Fayyad, a Palestinian economist and former International Monetary Fund (IMF) representative to the PA, as Finance Minister. Since then, Fayyad has been charged with overseeing the Palestinian Investment Fund, a single account for all aid deposits held at the Arab Bank in Gaza City. (37) Some analysts have credited Fayyad with streamlining PA government finances and making PA expenditures more transparent. On July 8, 2003, the United States announced that it would provide $20 million out of a $50 million FY2003 supplemental allocation as direct aid to the PA for infrastructure projects. U.S. policymakers assert that Finance Minister Fayyad brought credibility to the Palestinian Authority budget process.
Some Palestinian aid workers have expressed frustration with U.S. requirements for aid disbursement. According to a recent Washington Times report, some Palestinian organizations are refusing to sign a pledge promising that U.S. assistance will not be used to support terrorism. (38) The pledge is based on Executive Order 13224 that requires all recipients of U.S. aid to guarantee that their organization does not support terrorism. The report indicates that the aid workers feel that the pledge's definition of terrorist-supporting activities would cover the majority of projects underway in the West Bank and Gaza Strip. (39)
The following restrictions on aid to the Palestinians are found in H.R. 2673 (P.L. 108-199), the FY2004 Consolidated Appropriations bill:
State Sponsors of Terrorism. Under the terms of the Export Administration Act of 1979 (P.L. 96-72; 50 U.S.C. app. 2405(j)(as amended)), countries listed by the Secretary of State as "state-sponsors of terrorism"are prohibited from receiving foreign aid. In the Middle East, Iran, Iraq, Libya, and Syria have long been designated as sponsors of terrorism, though there is speculation that Iraq and possibly Libya may be removed from the list in the near future. (40) Iran, Iraq, Libya, and Syria were all recipients of U.S. military and economic aid at one time or another in the distant past.
Foreign Aid to Promote Reforms & Democratization. Although most analysts acknowledge that foreign aid to the Middle East functions primarily to serve U.S. regional security needs, there have been recent calls to use aid to foster economic development and democratization in Arab countries. The Bush Administration, in conjunction with international partners, is reportedly considering a plan to encourage democracy in the "greater Middle East" and tying the delivery of U.S. foreign aid to the reform process in many Arab countries. (41) On February 13, 2004, the English language website of the London-based Arabic daily Al Hayat, published a draft copy of the proposed G-8 "greater Middle East" plan. (42) The working paper proposed possible ways in which G-8 members could support a socio-economic reform process in Arab countries and in Pakistan, Afghanistan, Turkey, Iran, and Israel. Among other things, the draft paper calls on G-8 members to help establish a Middle East development bank and to continue efforts to provide training to women interested in running for elective office in countries with upcoming parliamentary elections.
Some observers have praised U.S. officials for proposing to take a multilateral approach to democracy promotion in the Middle East and for attempting to coordinate activities with existing international support programs, such as the European Union's Euro-Mediterranean Partnership Initiative. Other foreign officials have expressed reservations over the proposal, fearing that their programs may be absorbed by an American-led initiative. Some Arab governments have suggested that they may offer their own internal reform programs. According to Jordanian Foreign Minister Marwan Muasher, "the idea is to come up with a homegrown process in order that others not impose something from the outside." (43) On March 12, 2004, the New York Times reported that the Bush Administration has set aside its "greater Middle East" plan. (44)
For years, Congress has specified in annual foreign operations appropriations that ESF funds to Egypt are provided with the understanding that Egypt undertake certain economic reforms and liberalize its economy. USAID believes that its programs have helped contribute to Egypt's economic growth and macroeconomic stability. Others note that Egypt still has a bloated public sector, and assert that U.S. economic aid mainly helps subsidize Egypt's social welfare and education budget. U.S. policymakers have repeatedly suggested that trade with and investment in Egypt may be as effective as aid in reforming the Egyptian economy. In 1994, then Vice President Al Gore and Egyptian President Hosni Mubarak launched the United States-Egyptian Partnership for Economic Growth and Development, a council of private and public sector officials dedicated to enhancing trade between the two countries.
In the wake of the September 11 attacks, there has been a new impetus to fund regional democracy-promotion programs in the Middle East. On December 12, 2002, Secretary of State Colin Powell announced the creation of The Middle East Partnership Initiative (MEPI), a program to encourage reforms in Arab countries by strengthening Arab civil society, encouraging micro-enterprise, expanding political participation, and promoting women's rights. (45)
MEPI represents an attempt to take a more thematic approach to foreign aid in the Middle East by stressing its reform elements. Although funding for MEPI represents only a small portion of total aid to the region (2%), some U.S. officials stress that MEPI represents a philosophical commitment to ensure that future U.S. economic aid encourages social, political, and economic reforms in Arab countries. Some observers assert that if the MEPI reform agenda were applied broadly to Middle East development projects, it might produce difficulties or unforseen consequences.
Middle East Partnership Initiative
Appropriations, FY2002-FY2005 Request
(Regular & Supplemental Appropriations; Current Year $ in millions)
| FY2002 | FY2003 Actual | FY2004 Estimate | FY2005 Request |
| $29.000 | $90.000 | $89.469* | $150.000 |
*The FY2004 Iraq Reconstruction Relief Funds Supplemental (P.L. 108-106) specifies that $30 million in Iraq reconstruction funds may be transferred to MEPI for FY2004.
Congress also provides democracy-promotion funds to the State Department and non-governmental organizations for programs in countries with significant Muslim populations ($11.5 million in FY2004). The FY2004 consolidated appropriations bill specifies that $1.5 million may be used for grants to educational, humanitarian and non-governmental organizations and individuals inside Iran to support the advancement of democracy and human rights. The President's FY2005 budget request calls for increased funding to promote democracy in the Middle East, and requests $40 million in new funding for a "Greater Middle East Democracy Initiative" to be run by the National Endowment for Democracy.
Foreign Aid to Promote Human Rights. Congress at times may use foreign aid appropriations legislation as a vehicle to protest human rights violations in some countries of the Middle East. (46) Saad al-Din Ibrahim is an Egyptian professor and a critic of the Egyptian government's human rights and democracy record who also holds U.S. citizenship. In 2001, he was arrested for defaming Egypt by describing discrimination against Coptic Christians, and for not reporting a donation from the European Union for a voter education project. Ibrahim was acquitted by an Egyptian court in March 2003. In response to Ibrahim's detention, lawmakers inserted language into the FY2004 Consolidated Appropriations Act (P.L. 108-199) specifying $1 million in ESF be made available to support civil society organizations working for democracy in Egypt, including Ibrahim's organization, the Ibn Khaldun Center for Development. H.Con.Res. 363, introduced on February 11, 2004, condemns Syria's human rights record and encourages the United States to reach out to dissidents and human rights activists in Syria. The resolution has been referred to the House International Relations Committee.
Restricting Military Aid to Egypt. (47) Introduced on January 21, 2004, the Egyptian Counterterrorism and Political Reform Act (H.R. 3725), would substitute economic aid for Egypt's annual military assistance package for FY2005 and subsequent fiscal years. The bill would authorize the President to waive this substitution if he certifies to Congress that such action is in the interest of U.S. national security.
Some lawmakers have periodically called for restrictions on U.S. aid to Egypt on the grounds that Egypt indirectly supports Palestinian terrorism, suppresses its own population, including minority Christians, and continues to procure long-range missiles and other weapons systems from rogue states. (48) Others assert that reducing Egypt's military aid would undercut the peace between Israel and Egypt. (49) Overall, many U.S. officials believe that U.S. support for Egypt stabilizes the region and extends U.S. influence in the most populous Arab country.
Glossary
| Bilateral assistance | Economic aid provided by the United States directly to a country or through regional programs to benefit one or more countries indirectly. |
| Development assistance (DA) | Aid provided under Chapters I and 10 of the Foreign Assistance Act primarily designed to reduce poverty and promote economic growth. |
| Economic Support Fund (ESF) | An appropriation account for funding economic assistance to countries based on considerations of special economic, political or security needs and U.S. interests. |
| Foreign Assistance Act, 1961 (FAA) | The primary, permanent authorization for conducting U.S. foreign assistance programs. |
| Foreign Military Financing (FMF) | The major U.S. military aid program extending credits on a grant basis to finance U.S. overseas arms transfers. |
| International Military Education and Training (IMET) | A U.S. military aid program providing grant military training to selected foreign military and civilian personnel. |
| Iraq Relief and Reconstruction Fund (IRRF) | A catch-all development and security account controlled by the President containing funds for reconstruction activities in Iraq. |
| Middle East Partnership Initiative (MEPI) | A State Department program to encourage political, economic, and educational reforms in Arab countries. |
| Multilateral assistance | Assistance which the United States provides to developing nations through multilateral development banks, United Nations agencies, and other international organizations with development purposes. |
| Non-governmental organizations (NGOs) | Organizations that are independent of government. NGOs are frequently used to implement foreign aid programs. |
| Palestinian Authority | The Palestinian National Authority is a semi-autonomous quasi-state institution nominally governing the Palestinians in West Bank and the Gaza Strip |
| Pipeline | The amount of economic assistance that has been obligated by U.S. agencies but has not yet been expended. |
| P.L. 480 | Refers to the Agricultural Trade Development and Assistance Act of 1954, which governs administration of the U.S. food aid program. The Department of Agriculture manages title I of P.L. 480 (food aid provided on concessional loan terms) and USAID manages title II (food grants provided for development and humanitarian purposes). |
| Private Voluntary Organizations (PVOs) | Non-profit, tax-exempt and nongovernmental organizations established and governed by a group of private citizens whose purpose is to engage in voluntary charitable and development assistance operations overseas. |
| United Nations Relief and Works Agency for Palestine Refugees (UNRWA) | UNRWA provides relief and social services, including food, housing, clothing, and basic health and education to over 4.1 million registered Palestine refugees living mostly in the West Bank and Gaza Strip, but also in Jordan, Lebanon, and Syria. |
| U.S. Agency for International Development (USAID) | An independent government agency under the direction of the Secretary of State that manages most U.S. bilateral economic assistance programs. |
1. (back)For the purposes of this report, the Middle East region, or Near East, is defined as an area stretching from Morocco in the west to the Persian Gulf in the east, but not including Turkey.
2. (back) For assistance with foreign aid terminology and acronyms, please see the glossary appended to this report.
3. (back)"Bush Aims for Greater Middle East Plan," Washington Post, February 9, 2004. For more information on the Millennium Challenge Account, see CRS Report RL31687, The Millennium Challenge Account: Congressional Consideration of a New Foreign Aid Initiative, by Larry Nowels.
4. (back)In 1948, President Harry Truman, who sympathized with the plight of Israel in its early days, placed an arms embargo on Israel and her Arab neighbors in order to keep the United States neutral in the ongoing Arab-Israeli conflict.
5. (back)France supplied Israel with military equipment mainly to counter Egyptian power in the region. In the 1950s and early 1960s, Egypt antagonized France by providing arms and training to Algerian fighters in Algeria's war for independence against France.
6. (back)"America's Staunchest Mideast Ally," Christian Science Monitor, August 21, 2003.
7. (back)Section 651 of P.L.90-554, The 1968 Foreign Assistance Act, expresses the sense of Congress to see the United States negotiate the sale of supersonic aircraft to Israel.
8. (back)Between 1967 and 1973, Israel and its Arab neighbors fought the June 1967 War, the ensuing War of Attrition, and the October 1973 War. Israel also was engaged in continual low level guerrilla warfare with the Palestinian Liberation Organization and other guerilla groups, which had bases in Jordan and later in Lebanon. The 1974 emergency aid for Israel, following the 1973 war, included the first U.S. military grant aid.
9. (back) The Commodity Import Program for Israel ended in 1979 and was replaced with direct, unconditional cash transfers.
10. (back)This ratio is not found in the text of the 1978 and 1979 Camp David agreements. U.S. officials have not officially recognized the ratio. The Egyptian government claims that a 3 to 2 ratio between Israel and Egypt was established during the negotiations.
11. (back) The U.S. loan guarantee to Israel is not a direct transfer of U.S. government funds to Israel's treasury. Rather, it is a guarantee on a commercial loan between the borrower (Israel) and a private lender. A U.S. subsidy may be appropriated and set aside in a Treasury account, held against a possible default. The subsidy usually is a percentage of the total loan based in part on the credit rating of the country.
12. (back) See CRS Issue Brief IB91137, The Middle East Peace Talks, by Carol Migdalovitz.
13. (back) Signed on October 23, 1998, the Wye River Memorandum delineated steps to complete the implementation of 1993 Oslo Peace agreement between Israelis and Palestinians. See CRS Issue Brief IB91137, The Middle East Peace Talks, by Carol Migdalovitz.
14. (back)Although not part of the traditional foreign aid package to the region, Iraq reconstruction appropriations, when taken into account, dramatically alter the assistance picture for the Middle East. In FY2004, foreign aid to Iraq was more than three times the total U.S. assistance package to the rest of the Middle East.
15. (back) Following the peace talks at the Wye River Plantation in October 1998, President Clinton proposed an aid package of $1.2 billion for Israel, $300 million for Jordan, and $400 million for the Palestinians. Congress added $25 million for Egypt.
16. (back) Although the United States is in the process of phasing out economic aid (ESF)to Israel (see Israel country section), the U.S. has extended billions in loans to Israel in recent years.
17. (back) In 1998, Israel and the United States agreed to reduce U.S. economic assistance by $120 million per year and increase U.S. military assistance by $60 million per year over a 10-year period beginning in 1999. A similar formula for reducing economic aid was applied to Egypt, but Egypt did not receive an increase in military assistance.
18. (back)The tourism industry is one of Egypt's primary sources of foreign exchange.
19. (back)See CRS Report RL31833, Iraq: Recent Developments in Reconstruction Assistance, by Curt Tarnoff or CRS Report RL31339, Iraq: U.S. Regime Change Efforts and Post-Saddam Governance, by Kenneth Katzman.
20. (back) For further details on U.S. foreign assistance to Israel, see CRS Issue Brief IB82008, Israeli-United States Relations, by Clyde Mark and CRS Issue Brief IB85066, Israel: U.S. Foreign Assistance, by Clyde Mark.
21. (back) In FY1977, the Israeli government, for the first time, received special permission to use FMF for research and development in Israel on the Merkava tank. After this precedent was established, Israel has been allowed to spend a set percentage of its annual FMF inside Israel.
22. (back) Other governments receive economic aid or a percentage of their economic aid as a grant cash transfer.
23. (back) This agreement is noted in the conference report for the Security Assistance Act of 2000, H.R. 4919/P.L. 106-280, October 6, 2000.
24. (back) "U.S. to phase out economic, boost military aid to Israel," CNN.com, January 19, 2001. Available at http://www.cnn.com/2001/WORLD/meast/01/19/us.israel/
25. (back) For additional information on U.S. aid to Egypt, see CRS Issue Brief IB93087, Egyptian-United States Relations, by Clyde Mark. For details on USAID's Egypt program, see http://www.usaid-eg.org/.
26. (back) For details on USAID's Jordan program, see
http://www.usembassy-amman.org.jo/USAID/Extamm.htm.
27. (back)The USAID program in the West Bank and Gaza Strip provides assistance to the Palestinian people through contractors and charities. The PLO, which represents the Palestinian diaspora, has never received funds from the U.S. government. The Palestinian Authority (PA), which acts as a quasi-governmental structure in parts of the West Bank and Gaza Strip, has received direct U.S. assistance on two occasions.
28. (back)See H.R. 2673 (P.L. 108-199), Consolidated Appropriations Act, FY2004, Limitation on Assistance to the Palestinian Authority, sec. 552.
29. (back) This gesture was in support of the former Palestinian Prime Minister Mahmud Abbas, who, while in office, was a strong proponent of the Road Map peace process.
30. (back) For details on USAID programs in Morocco, Lebanon, and Yemen, see http://www.usaid.gov/locations/asia_near_east/countries/countries.html.
31. (back)For FY2004, Algeria, Bahrain, Lebanon, Morocco, Oman, Saudi Arabia, Tunisia, and Yemen received a total of $145 million.
32. (back) "Arafat Is Said to Fund Truce Foes," Boston Globe, July 23, 2003.
33. (back)Judy Barsalou, "Missing the Mark: Foreign Aid to the Palestinians," Middle East Policy, Vol.X, No.4, Winter 2003.
34. (back)On November 17, 2003, the General Accounting Office (GAO) released the results of its investigation of UNRWA. It found that UNRWA does not have an arrangement with authorities in the West Bank and Gaza to review local job applicants for UNRWA employment. See http://www.gao.gov/docdblite/details.php?rptno=GAO-04-276R.
35. (back) "Lantos Call for Probe of UNRWA," Ha'aretz, May 22, 2002.
36. (back)
"Frequently Asked Questions - USAID West Bank and Gaza Program," The United
States Agency for International Development (USAID) website:
http://www.usaid.gov/wbg/faq.htm#aa13.
37. (back) The Palestinians Authority depends on foreign aid for 60% of its annual budget revenues. Arab donors are the largest contributors of foreign aid to the West Bank and Gaza Strip, followed by the European Union and the United States. The World Bank, individual EU member states, Canada, Switzerland, and Japan also are major contributors of aid.
38. (back)"Palestinian Groups Refuse Funds," Washington Times, January 8, 2004.
39. (back) To
read more about Executive Order 13224 and review the U.S. Treasury Department's Office of
Foreign Asset Control Terrorism Sanctions Regulations, see:
http://www.treas.gov/offices/eotffc/ofac/sanctions/t11ter.pdf.
40. (back) Iraq may be removed from the state-sponsors of terrorism list once an internationally recognized, sovereign Iraqi government comes into power.
41. (back)"Bush Aims for Greater Middle East Plan," Washington Post, February 9, 2004.
42. (back)"U.S.
Working Paper for G-8 Sherpas," Al-Hayat, February 13, 2004. Available online at:
http://english.daralhayat.com/Spec/02-2004/Article-20040213-ac40bdaf-c0a8-01ed-004e-5e7ac897d678/story.html
43. (back)"Arab Leaders Seek to Counter U.S. Plan for Mideast Overhaul," New York Times, March 4, 2004
44. (back)"U.S. Muffles Sweeping Call to Democracy in Mideast," New York Times, March 12, 2004.
45. (back) See CRS Report RS21457, The Middle East Partnership Initiative: An Overview, by Jeremy M. Sharp.
46. (back)Critics of U.S. Middle East Policy accuse the United States of supporting autocratic governments that frequently commit human rights violations.
47. (back)See CRS Issue Brief IB93087, Egypt-United States Relations, by Clyde Mark.
48. (back)"U.S. Worries over Egypt-North Korea Missile Program," Middle East Times, June 22, 2001, http://www.metimes.com/2K1/issue2001-25/methaus.htm.
49. (back)"Aid to Egypt: Why the Current Mix Works," MEI Perspective, Remarks by Ambassador Edward S. Walker Jr., the Middle East Institute, March 8, 2002.
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