An independent federal agency, the United States Trade and Development Agency (USTDA) is responsible for helping promote development in other countries while also advancing economic opportunities for US businesses. It carries out this dual mission by distributing funds to foreign projects that in turn hire American companies to perform such work as technical assistance, feasibility studies and training, so that American taxpayers are, in essence, paying select companies to perform work overseas. USTDA funding has been distributed around the globe, from Latin America to Sub-Saharan Africa. At times, the agency has been accused of targeting its grants to help American industries exploit the natural resources of foreign regions.
The idea behind the Trade and Development Agency began with early foreign assistance initiatives like the Marshall Plan and subsequent legislation such as the Mutual Security Act of 1954 and the Foreign Assistance Act of 1961. In 1974 Congress added section 661 to the Foreign Assistance Act of 1961, which addressed the concept of using taxpayer dollars to assist overseas development through US corporations.
In the 1970s, the US Agency for International Development (USAID) was in charge of putting foreign governments in touch with American agencies to gain so-called “reimbursable services.” This work was handled by USAID’s Office of Reimbursable Development Programs. Funding for activities that linked US businesses to development efforts in 1976 and 1977 fell to only about $1 million annually. Soon thereafter, however, many lawmakers in Congress began to believe that the federal government should be more active in development programs.
In 1978, Congress directed USAID to increase emphasis on private sector involvement in development assistance. By March 1979, USAID issued new guidelines facilitating the involvement of American companies in development from the earliest planning stages of the projects through implementation.
In July 1980, in an effort to bolster the link between private sector and development activities, USAID’s Office of Reimbursable Development Programs was made a separate part of the International Development Cooperation Agency (IDCA), a newly created umbrella agency tasked with coordinating all American development assistance
programs in the federal government. At the same time, the former AID office was renamed the Trade and Development Program (TDP).
Congress further strengthened TDP’s autonomy with passage of the Omnibus Trade and Competitiveness Act of 1988, which turned the program into an independent agency and required the TDP director to be appointed by the President. It established TDP as the primary federal agency responsible for providing information to the private sector regarding trade and development and export promotion.
In December 1992, Congress enacted the Jobs through Export Act, which renamed TDP the Trade and Development Agency (TDA). Lawmakers supported the name change to clarify and emphasize that TDA is an independent agency and to increase its visibility as the primary federal agency promoting private sector trade development in developing countries. In addition, the act required annual independent audits of TDA’s financial statements.
Congressional Research Service: The Trade and Development Agency
The US Trade and Development Agency (USTDA) is an independent federal agency that provides funding to projects overseas that help advance both foreign economic development and American commercial interests. USTDA’s funding supports various activities, including technical assistance, feasibility studies and training. The agency gives out grants, awards contracts to US firms and accesses trust funds at several multilateral development bank groups.
The agency’s grants go directly to overseas project sponsors who then select US companies to provide needed services or goods. These arrangements are formed into public-private partnerships (PDF), examples of which include a natural gas pipeline involving Azerbaijan, Georgia and Turkey, an aviation cooperation program between China and the US, and a wastewater treatment plant in Uganda involving Lake Victoria.
Recipients of USTDA may be government institutions at the national, state/provincial, or local level, or local private companies. In selecting foreign projects to support, USTDA looks for those that have the potential to generate significant exports of US goods and services.
A foreign assistance agency, USTDA distributed in FY 2007 nearly $46 million in support of projects in 51 counties around the world. In 2007, USTDA funded 63 technical assistance activities, 43 feasibility studies and 31 orientation visits. The average size of a USTDA grant was $400,000.
In additions to its bureaus, USTDA operates offices at its headquarters that handle responsibilities for legal affairs (general counsel), external relations, grants administration, evaluations, finance, contracts, general administration, information technology and an Information Resources Center.
USTDA provides details on all of its overseas contract awards. The agency awards are grouped into categories covering agribusiness, energy and power, human resources, manufacturing, mining and natural resources, telecommunications, transportation and water and environment.
For example, in September 2007, the agency gave out two grants (PDF) to Indonesian companies totaling $1 million to help develop alternative sources of energy.
In September 2005, USTDA awarded a $570,000 grant to Petron Corporation, the largest oil refining company in the Philippines, to partially fund a feasibility study for the development of a benzene-toluene-xylene (BTX) recovery and extraction unit.
The USTDA awarded in December 2006 to the Afghanistan Telecommunications Regulatory Authority (ATRA) a $404,500 grant to fund technical assistance to the ATRA in determining how to implement and administer the Telecommunications Development Fund (TDF), which was established by the government of Afghanistan to further growth in rural telecommunications infrastructure.
In addition to helping American businesses reap the benefits of development work, USTDA hires contractors to support agency operations. According to USAspending.gov, the USTDA spent $47 million from 2000-2009 on contractors. A total of 265 contractors were paid by the agency to deliver services that covered management and support for research and development ($32.2 million), engineering ($6.4 million) and vocational/technical work ($2.3 million).
The top ten contractors for USTDA are:
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Elliott Koeppen & Associates Limited
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$3,837,795
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Mfm Group, Inc
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$3,246,099
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Tera International Group, Inc.
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$1,931,564
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The QED Group LLC
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$1,748,890
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The Business Council For International Understanding Inc
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$1,398,161
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Global Marketing & Communications Inc
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$1,382,009
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Infoexchange LLC
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$1,290,428
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Technical Resources Inc
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$1,270,048
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Lyme Computer Systems, Inc.
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$1,152,542
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Decision/Analysis Partners, LLC
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$1,137,079
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The USTDA’s largest contractor specializes in international trade event planning, organization and management. It also feasibility studies, regional market analysis and project finance sourcing. For the USTDA, the company provides research and development for trade events.
The USTDA’s second largest contractor produces high-level conferences and international trade event solutions. It also aids in event planning and language and specialized communication equipment services. For the USTDA, the company provides language translation services and management and support.
The USTDA’s third largest contractor provides assistance in infrastructure economics and planning studies; evaluations of the effectiveness and efficiency of government policies and programs; analyses of regulatory impacts; simulation and modeling of infrastructure systems; evaluations of existing infrastructure performance and identification of new infrastructure needs; and business planning and financial feasibility analyses. For the USTDA, the company provides technical assistance and program evaluation services.
The USTDA’s fourth largest contractor is a full-service consulting firm that provides analysis, management techniques, and implementation. For the USTDA, the company provides research and development and administrative support.
The USTDA’s fifth largest contractor was created under a White House initiative under President Eisenhower in 1955. The Business Council for International Understanding (BCIU) is a neutral, results-oriented partner, facilitating dialogue and alliances between world businesses and political leaders. BCIU brokers contacts and organizes custom-tailored events, briefings and off-the-record discussions so that stakeholders may speak candidly about core issues in a direct and timely manner, enabling resolution of problems and promotion of business opportunities in both the private and public sectors of the global marketplace. For the USTDA, the company provides training lectures and management support.
The USTDA’s sixth largest contractor provides consulting services that aid in investment, management and marketing. For the USTDA, the company assists with research and development.
The USTDA’s seventh largest contractor organizes conferences and custom executive training workshops that help organizational leaders respond effectively to technological, economic, political, and cultural developments. For the USTDA, the company assists with conference organization.
The USTDA’s eight largest contactor specializes in three main areas of communications, health services and information technology. For the USTDA, the company provides management support through research and development.
The USTDA’s ninth largest contractor is a full-service computer products reseller with a focus on networking, networking security and interconnectivity that primarily works with the US government. For the USTDA, the company provides technical support and computer hardware and software.
The USTDA’s tenth largest contractor is a global consulting firm focuses on supply chain and logistics operations management, information and communications technologies, and postal service operations and management. For the USTDA, the company provides program review and development services.
USTDA Accused of Exploiting Africa’s Oil Potential
Since the beginning of this decade, US government and industry officials have been trying to position the United States to take advantage of Africa’s untapped petroleum resources. In December 2000, the National Intelligence Council, the Central Intelligence Agency’s think-tank, declared in a report that sub-Saharan Africa, “will play an increasing role in global energy markets.”
A key player in the American drive for Africa’s oil is the United States Trade and Development Agency, which gave funding to a US consultant, RKR Enterprises, to begin exploring Uganda’s emerging petroleum and gas industry and advise on where the US should “grant assistance.”
Some observers have speculated that in its quest to gain access to Uganda’s oil, the US will turn a blind eye to Uganda's President Yoweri Museveni, who has been accused of jailing political opponents. If this is true, “Ugandans can expect little out of their oil find,” wrote Peak Oil.
USTDA Cancels Contract Amid Russian Scandal
By 2002, the Russian energy firm ITERA had received billions of dollars worth of natural gas resources from Gazprom, a state-controlled conglomerate, practically for free. It was believed that insiders working for Gazprom had received massive kickbacks in return for the shady deals.
Because of the scandal, officials at the US Trade and Development Agency decided to withdraw a pending $868,000 grant to ITERA in March 2002. The cancellation represented a serious setback for ITERA, which had planned to open offices in the United States in order to expand its access to Western investment capital and markets.
Two months later, Congressman Curt Weldon (R-PA) tried coming to ITERA’s rescue. He flew to Moscow to meet with the firm’s executives and publicly praised ITERA as “a great source” for US energy firms seeking foreign partnerships. After he returned home, Weldon attacked USTDA for withdrawing the grant and contacted Karl Rove and Energy Secretary Spencer Abraham on the firm’s behalf.
Four months later, ITERA signed a $500,000 contract with Solutions North America, a firm led by Karen Weldon, the congressman’s 29-year-old daughter. Karen’s job, according to lobbyist disclosure filings, was to create “good public relations so in the future ITERA may sell goods and services to US entities.” Her father later wound up being investigated by federal law enforcement officials.
The ITERA/Weldon Link: Congressman flacked for daughter's client despite being briefed on its shady practices
(by Ken Silverstein, Harper’s Magazine)
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Founded: 1981
Annual Budget: $50 million
Employees: 50
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United States Trade and Development Agency
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Zak, Leocadia I.
Director
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President Barack Obama turned to an agency veteran, Leocadia I. Zak to lead the U.S. Trade and Development Agency (USTDA). USTDA is an independent agency responsible for helping promote development in other countries while also advancing economic opportunities for US businesses. It carries out this dual mission by distributing funds to foreign projects that in turn hire American companies to perform such work as technical assistance, feasibility studies and training. Zak was confirmed by the U.S. Senate as USTDA director on March 10, 2010, and assumed office April 10.
Born circa 1957, Zak earned her B.A. from Mount Holyoke College in 1979 and her J.D. from Northeastern University School of Law in 1982. Zak practiced law for 18 years at the law firm of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo. She worked first in the firm’s Boston office and relocated circa 1998 to Washington, D.C., where she was a partner practicing in the areas of corporate, municipal and international project finance. Her specialty was creating financing for large infrastructure projects such as airports, toll roads, municipal water systems and power generation facilities.
She left private practice to serve as General Counsel of USTDA from April 2000 to December 2005, and was named Deputy Director in January 2006. Zak assumed the duties of Acting Director from April 30, 2007 through March 16, 2008, and again on January 20, 2009. Zak has taught “International Project Finance” as an Adjunct Professor of Law at the Boston University School of Law and at the Georgetown University Law Center.
Zak is married to Kenneth W. Hansen, a partner in the Washington, D.C., office of the law firm of Chadbourne & Park. The couple lives in Washington, D.C. A Democrat, Zak has contributed $14,050 to political organizations and candidates since 1992, all of it save $200 to Democrats, including $750 to Al Gore’s 2000 presidential campaign, $2,000 to John Kerry’s 2004 presidential campaign, and $3,300 to Barack Obama’s 2008 presidential campaign. The sole Republican was Rhode Island’s Nancy Mayer, a law school classmate of Zak’s who ran unsuccessfully for Senate in 1996.
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Walther, Larry
Previous Director
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Larry W. Walther has served as the director of the US Trade and Development Agency (USTDA) since March 17, 2008.
Walther served 30 years with SBC Communications, now AT&T. He started out as a switching engineer for Southwestern Bell Telephone Company in 1970 and concluded his career as the Vice President for Corporate Services and chairman of the SBC Foundation. In that capacity, he oversaw a philanthropic organization that managed $67.4 million in community and charity giving. In 1989, he was chosen as one of 20 private sector executives to serve a one-year appointment to the Bush Administration and was assigned to the US Department of the Treasury.
Before taking over the USTDA, Walther served as the director of the Arkansas Department of Economic Development. There, he was responsible for the overall direction and management of the department and for representing the governor and the state on all matters concerning statewide issues of economic development.
Walther has served on the board of trustees of the College of the Ozarks in Point Lookout, Missouri, since 1992, serving as board chairman from 2001 until 2007. In addition, he serves on the board of directors of Arkansas Easter Seals. He has also been a member of the executive board for Quapaw Area Boy Scouts, the University Of Arkansas Walton School of Business Board of Visitors, Downtown Little Rock Rotary, the University of Arkansas Medical Sciences BioVentures Advisory Board, the Arkansas Policy Foundation, the Southern Technology Council and the Little Rock Sertoma Club. He is also actively involved in the Fellowship Bible Church in Little Rock, Arkansas.
Official Bio
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