[House Hearing, 116 Congress] [From the U.S. Government Publishing Office] STATE, FOREIGN OPERATIONS, AND RELATED PROGRAMS APPROPRIATIONS FOR 2021 _______________________________________________________________________ _______________________________________________________________________ HEARINGS BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS HOUSE OF REPRESENTATIVES ONE HUNDRED SIXTEENTH CONGRESS SECOND SESSION ___________ SUBCOMMITTEE ON STATE, FOREIGN OPERATIONS, AND RELATED PROGRAMS NITA M. LOWEY, New York, Chairwoman BARBARA LEE, California GRACE MENG, New York DAVID E. PRICE, North Carolina LOIS FRANKEL, Florida NORMA J. TORRES, California HAROLD ROGERS, Kentucky JEFF FORTENBERRY, Nebraska MARTHA ROBY, Alabama NOTE: Under committee rules, Mrs. Lowey, as chairwoman of the full committee, and Ms. Granger, as ranking minority member of the full committee, are authorized to sit as members of all subcommittees. Steve Marchese, Craig Higgins, Erin Kolodjeski, Dean Koulouris, Jason Wheelock, Jean Kwon, Marin Stein, and Clelia Alvarado Subcommittee Staff ___________ PART 3 Page Department of State, Foreign Operations, and Related Programs........ 1 United States Agency for International Development............................. 3 Export and Finance Agencies........... 83 U.S. Department of the Treasury International Programs.................. 167 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] ___________ Printed for the use of the Committee on Appropriations U.S. GOVERNMENT PUBLISHING OFFICE 43-523 WASHINGTON : 2021 COMMITTEE ON APPROPRIATIONS NITA M. LOWEY, New York, Chairwoman MARCY KAPTUR, Ohio KAY GRANGER, Texas PETER J. VISCLOSKY, Indiana HAROLD ROGERS, Kentucky JOSE E. SERRANO, New York ROBERT B. ADERHOLT, Alabama ROSA L. DeLAURO, Connecticut MICHAEL K. SIMPSON, Idaho DAVID E. PRICE, North Carolina JOHN R. CARTER, Texas LUCILLE ROYBAL-ALLARD, California KEN CALVERT, California SANFORD D. BISHOP, Jr., Georgia TOM COLE, Oklahoma BARBARA LEE, California MARIO DIAZ-BALART, Florida BETTY McCOLLUM, Minnesota TOM GRAVES, Georgia TIM RYAN, Ohio STEVE WOMACK, Arkansas C. A. DUTCH RUPPERSBERGER, Maryland JEFF FORTENBERRY, Nebraska DEBBIE WASSERMAN SCHULTZ, Florida CHUCK FLEISCHMANN, Tennessee HENRY CUELLAR, Texas JAIME HERRERA BEUTLER, Washington CHELLIE PINGREE, Maine DAVID P. JOYCE, Ohio MIKE QUIGLEY, Illinois ANDY HARRIS, Maryland DEREK KILMER, Washington MARTHA ROBY, Alabama MATT CARTWRIGHT, Pennsylvania MARK E. AMODEI, Nevada GRACE MENG, New York CHRIS STEWART, Utah MARK POCAN, Wisconsin STEVEN M. PALAZZO, Mississippi KATHERINE M. CLARK, Massachusetts DAN NEWHOUSE, Washington PETE AGUILAR, California JOHN R. MOOLENAAR, Michigan LOIS FRANKEL, Florida JOHN H. RUTHERFORD, Florida CHERI BUSTOS, Illinois WILL HURD, Texas BONNIE WATSON COLEMAN, New Jersey BRENDA L. LAWRENCE, Michigan NORMA J. TORRES, California CHARLIE CRIST, Florida ANN KIRKPATRICK, Arizona ED CASE, Hawaii Shalanda Young, Clerk and Staff Director C O N T E N T S ---------- Witnesses Page Boehler, Adam, Chief Executive Officer, U.S. International Development Finance Corporation................................ 106 Prepared statement........................................... 108 Answers to submitted questions............................... 143 Green, Hon. Mark, Administrator, U.S. Agency for International Development.................................................... 5 Prepared statement........................................... 8 Answers to submitted questions............................... 48 Hardy, Thomas, Acting Director, U.S. Trade and Development Agency 86 Prepared statement........................................... 89 Answers to submitted questions............................... 130 Mnuchin, Hon. Steven, Secretary, Department of the Treasury...... 169 Prepared statement........................................... 171 Answers to submitted questions............................... 190 Reed, Kimberly, President and Chairman, Export-Import Bank of the United States.................................................. 95 Prepared statement........................................... 97 Answers to submitted questions............................... 160 Submitted Material Fortenberry, Hon. Jeff, a Representative in Congress from the State of Nebraska, letter of June 20. 2019 to Gene Dodaro, Comptroller General, GAO....................................... 81 STATE, FOREIGN OPERATIONS, AND RELATED PROGRAMS APPROPRIATIONS FOR 2021 ---------- THE DEPARTMENT OF STATE, FOREIGN OPERATIONS AND RELATED PROGRAMS BUDGET REQUEST FOR FISCAL YEAR 2021 [Clerks Note: Secretary of State Mike Pompeo did not make himself available to present the Fiscal Year 2021 Budget Request for the Department of State, Foreign Operations and Related Programs to the committee.] Tuesday, March 3, 2020 UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT BUDGET REQUEST FOR FISCAL YEAR 2021 WITNESS HON. MARK GREEN, ADMINISTRATOR, UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT OPENING STATEMENT BY CHAIRWOMAN LOWEY The Chairwoman [presiding]. The Subcommittee on State, Foreign Operations, and Related Programs will come to order. Administrator Green, thank you for joining us today. I really do want to thank you for your stewardship of USAID during very difficult times, and for the dedication of our development professionals. USAID helps the world's most vulnerable, assists in recovery from natural disasters and humanitarian crises, and supports countries' efforts to strengthen governance, rule of law, and human rights. This isn't just the right thing to do. It strengthens our national security and advances American interests. And you certainly have your work cut out for you. There are more than 70 million refugees and displaced people around the world, which is fueled by conflict, natural disasters, and climate change. Ebola continues to simmer in the Democratic Republic of Congo, while the novel coronavirus outbreak threatens to become a pandemic. Despite significant progress on our development priorities, we are currently off track to meet the U.N. Sustainable Development Goals by 2030. Our development and humanitarian efforts are our best hope to tackle these issues. This is why Congress has disregarded this administration's last three budget requests, instead providing sufficient resources to effectively and efficiently fund some of our most critical foreign policy priorities. The administration's fiscal year 2021 budget request includes funding for several development initiatives that we support, such as women's economic empowerment, investments to strengthen emerging private sectors, and global health security. However, the administration cannot be successful in these initiatives if we under or defund the basics, which is exactly what the proposed 20 percent cut to our foreign assistance programs would do. For example, if enacted, this request would cut basic education by 66 percent and family planning by 59 percent. Now, the administration certainly cannot seriously believe that millions of women can achieve economic empowerment if they are unable to read, write, do math, or control the timing and number of children they have. Any benefit from an increase in global health security would surely be offset by the proposed 34 percent cut to all other global health programs. Instead of requesting funding and implementing policies to ensure USAID can be successful, the administration seems intent on putting every possible barrier in your way. This is certainly true of the expansion of the Global Gag Rule, the Kemp-Kasten determination against UNFPA, and unfair stigmatization of multilaterals as wasteful and working against U.S. interests. The administration's multiple policy reviews have also led to program delays and suspension of assistance. This subcommittee has always believed that our national security is strongest when defense, diplomacy, and development are equally funded. Without robust funding for development and humanitarian programs, the U.S. will fail to maintain our position as a leader on the global stage. This will not only harm the world's most vulnerable, it puts U.S. lives at risk and reduces our influence. We cannot and will not allow this to happen. So, again, I want to thank you for testifying today, and I look forward to your discussion and our discussion. And before we move to your testimony, let me turn to Mr. Rogers, the ranking member, who is committed to these issues and has worked very hard as a partner. Please go forward with your opening statement. Thank you. OPENING STATEMENT BY RANKING MEMBER ROGERS Mr. Rogers. Thank you, Madam Chair, and welcome, Mr. Ambassador. We appreciate your being here to discuss the budget and the spending plans and a review of your work at the Agency. Let me start by once again acknowledging the good work that you are doing at USAID and the collaborative manner in which you do it. These are not easy times to be engaged in international development. The challenging operating environments from insecurity continue to mount as do the needs of those we aim to help. I salute your dedicated cadre of development professionals that too often are working in or near very dangerous circumstances. Your leadership and experience, especially having served as an ambassador, and, coincidentally, in this body, comes at a critical time because you are already keenly aware of the risks our Foreign Service officers face in carrying out their duties. In these uncertain times, I want you to know that I am grateful for your leadership at USAID, and you have my support for whatever that means. Turning to the matter at hand, the President's budget request for fiscal 2021 is nearly a 20 percent cut from the fiscal 2020 enacted budget. I suspect this proposed cut will be handled in a manner similar to prior years. I look forward to working with the chairwoman in the weeks ahead on a bill that provides more appropriate levels of funding to address the serious global challenges that we are confronted with this year. However, there are a few notable improvements in parts of the budget that deserve mention, including prioritized funding for the Indo-Pacific Strategy, countering Chinese, Russian, and Iranian malign influence, and a focus on strengthened engagement with the private sector. I hope you will address these topics as we go along this morning, as well as how you see the role of USAID in Afghanistan as we enter this new chapter of our engagement there. I am also interested to hear more about how USAID has and will respond to the coronavirus outbreak. As you know, we have been working hard on a supplemental appropriations bill to help in this regard, and I hope and trust we will pass that through the House this week. I was chairman of the full committee when we worked on the Ebola outbreak in West Africa and also when Zika hit. Having shepherded the supplementals to address those outbreaks through the Congress, I knew when I became chair of this subcommittee that I wanted to create a pot of funding that could be tapped quickly to address an emerging health threat abroad. That is how we ended up with the emergency reserve that you were able to draw from last week for your initial response. I am sure that the months ahead will not be easy in combatting this current outbreak, but I hope you will keep us informed and let us know what we can do to help in this global effort. There are more priorities that I will address when it comes time for questions. So in closing with this opening statement, let me once again thank you and the men and women of USAID for your hard work and your commitment to service. We thank you. I yield. The Chairwoman. Thank you, and I will be calling on members based on seniority of the members that were present when the hearing was called to order. I will alternate between majority and minority, and each member is asked to keep their questions to within 5 minutes per round. But first, Administrator Green, we will be happy to place your full testimony into the record. If you would like to proceed by summarizing your oral statement, that would be fine. Proceed as you wish, and I want to make sure you leave enough time to get to everyone's questions. Thank you. OPENING STATEMENT BY AMBASSADOR GREEN Mr. Green. Thank you, Madam Chair, Ranking Member Rogers, and members of the subcommittee. I do welcome this opportunity to summarize my testimony, but also to express my appreciation for your ongoing support, particularly for the men and women professionals of USAID all around the world. As you have noted, they are working often in very trying circumstances. The President's fiscal year 2021 budget requests approximately $19.6 billion for USAID. It is an effort to balance fiscal responsibility here at home with our leadership role and national security imperatives on the world stage. I would like to begin by discussing some of the latest developments on a few of our more pressing issues, like the DRC, where USAID continues to lead the U.S. government's response to the Ebola outbreak. There is solid progress to report. There were no new confirmed cases last week, the first time that has happened since the response began. To be clear, the outbreak is not over. Ongoing security threats could still unravel the progress, but, nonetheless, there is reason to be optimistic. Of course, one of the administration's very highest priorities is taking on the threat posed by the coronavirus. Last month, Secretary Pompeo announced that the U.S. government will contribute up to $100 million to help stem the spread of the disease internationally. That includes $37 million, as was referenced, from USAID for work in affected countries. These resources are at work in a range of activities, including surveillance, lab testing, and public messaging campaigns. We are also sending out personal protective equipment to a number of countries. There is still much we don't know about the disease, but it is worth noting that USAID has invested more than $1.1 billion in global health security since 2009. Those investments have helped improve the capacity to prevent, detect, and respond to emerging disease threats like the coronavirus. From natural crises to manmade crises, there is Yemen, in many ways the world's largest humanitarian disaster. Interference by the Houthis has forced us to plan for a partial suspension of programs in the country's north, the harassing of aid workers and imposing numerous obstacles to service delivery. We cannot tolerate our assistance being impeded or diverted. The Houthis must take action to end the interference, or else we will be forced to limit where and what we provide. In northwest Syria, recent operations by Syrian and Russian security forces have displaced nearly 1 million from Idlib and Aleppo. A recent Security Council decision means, in effect, that U.N. agencies can no longer use one of the only three entry points into northeastern Syria, dangerously constricting our humanitarian lifeline. On a brighter note, last October, USAID signed its first bilateral agreement with Venezuela in decades. It enables us to expand our support to independent media, civil society, the National Assembly, and the government of Interim President Juan Guaido. It will also allow us to provide additional support once a democratic transition occurs. The request for Venezuela includes $205 million from ESDF and Global Health funds for that important work. We are all hopeful that we get to that day when such funds can be expended and invested. On a related note, I want to thank the subcommittee for its support of our work in Colombia. The visit by your staff to our mission was deeply appreciated by our teams there. In the Sahel, security conditions continue to deteriorate. The U.N. estimates in Burkina Faso, for example, 4,000 people have been displaced every single day since the year began. USAID is providing humanitarian assistance to those in need, trying to help stabilize violence-affected areas, and also counter extremist messaging. I want to take a moment and highlight two successes as we talk about some of the challenges. There are great opportunities and progress that we can report on. In India, we hope to soon welcome the establishment of a new U.S.-India Development Foundation that will enable us to serve in a more catalytic role, and help the government more effectively mobilize domestic resources towards areas of ongoing need. In Albania, there is similar progress. Prime Minister Edi Rama told me last November Albania doesn't need more money. It needs more technical assistance and knowledge as it takes on corruption. We hope to soon see a U.S.-Albania Transparency Academy, which will help foster a culture of transparency and accountability in the country's governing institutions. Our ongoing work to bring transformation to the Agency is becoming more tangible than ever. With your support, we have now legally established the Bureaus for Resilience and Food Security, Humanitarian Assistance, and Conflict Prevention and Stabilization. We hope they will soon be joined by the proposed Bureau for Policy, Resources and Performance, the concept note for which it is still waiting congressional concurrence. It is the most important remaining piece of our transformation, and I look forward to continuing to work with you to answer any questions that you might have. Religious freedom isn't merely an American value, as we all know. It is a human right. Sadly, religious plurality and the freedom to openly practice one's faith remains under threat in many countries. We are continuing to support communities in northern Iraq and across the Middle East as they recover from ISIS brutality. The request includes $150 million to maintain and expand that work. We use those resources to assist communities of all faiths that face discrimination or persecution wherever it occurs. We are also committed to helping countries struggling to provide high-quality education for their children and youth. Madam Chair, given your announced retirement plans, I wanted to take a moment to offer a note of admiration. Throughout your time in Congress, you have promoted the transformative power of education. You have also paid special attention to children living in conflict and crisis situations, and you have worked tirelessly to provide them with access to educational services. Your work has created tools and rallied resources that provide hope and regeneration at great risk. You may be stepping away from Congress, not yet, but your legacy will live on through the millions of people whose lives you have lifted. It is only one of the reasons you will always be my favorite Jewish mother. Members, I appreciate your support, your guidance, your counsel. And, Madam Chair, again, it has been an honor to appear before you. Thank you, and I welcome your questions. [The prepared statement of Ambassador Green follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] The Chairwoman. Well, thank you very much, Mr. Ambassador. First of all, I appreciate your very kind words. As you know, this has been really an opportunity to serve and to do many good things, and it has really been a special opportunity for me to work with you. We are fortunate to have a person with your integrity, your commitment, and your knowledge in this position, and there are still many more months left. We could do a lot of things together. So thank you again for your kind words. Now, I have many concerns as does this committee---- Mr. Green. So much for the efforts. [Laughter.] The Chairwoman. So I will begin with Afghanistan because it has been 17 years, I believe. Isn't that correct? I am very concerned that the recently-signed peace agreement with the Taliban could undermine the more than $30 billion this subcommittee has provided since 2002 to help promote the rights of women and girls, strengthen institutions for good governance, and increase access to quality education. Now, under the peace agreement, can you share with us what is USAID's role? Will our programs continue? Will there be any significant changes to USAID programming or presence? I have a second part, but I will let you respond to the first. Mr. Green. Thank you, Madam Chair. I can't tell you that I know all the terms of the peace agreement yet, and obviously we are the front end of it. I think Secretary Pompeo has put it very well. We are at the moment of opportunity for the people of Afghanistan and their leaders. What I can tell you from the USAID perspective is that in addition to focusing on the conditions necessary for peace and applying the lessons that we have learned from these years, we are dedicated to implementing the goals in our country's strategy, including women's empowerment and educational opportunity, particularly higher education opportunity. As we have spoken many times, the future of Afghanistan, the sustainable, bright future for Afghanistan, is dependent upon increasing the role of women in the economy, in community leadership, and obviously that is very hard to do if those educational opportunities go away. So we continue to be dedicated to those goals. The Chairwoman. Now, can you assure us that the investments made to strengthen the rights of women and girls and increase access to education can be maintained? For example, the subcommittee has demonstrated strong bipartisan support for the American University in Afghanistan. Will our assistance to AUAF continue under the peace agreement? Mr. Green. Let me break that apart, if I can, into two pieces. First, in terms of overall the goals that we have shared, women's empowerment and educational opportunity, what I can guarantee for you is that we will continue to pursue those goals. We can never guarantee the outcomes. We can guarantee the effort. With respect to AUAF, as we have talked about before, AUAF has been operating under an extended cooperative agreement, the terms of which run out in May. However, they have been granted a no-cost extension, which takes them into the summer, and they have been invited to compete for competitive funding, which is out there. It is procurement sensitive, and I am not even sure of all those who have applied. But I can tell you that the goals of higher educational opportunities remain as important to us today as they ever have been. The Chairwoman. I just wonder if the administration, in orchestrating this peace agreement, is consulting with you at all. Are they looking for any assurance that there may be actions that have to be put in place to preserve the extraordinary progress that has been made? Have you been part of any kind of discussions? Mr. Green. What I can tell you is that we have staff who have been assisting our special envoy. So we have certainly had the opportunity to express or to remind diplomatic representatives of the work that we have all been doing. And I know in the brief conversations that I have had, that there is very much the sense that the work that we have been performing over the years has made a difference and is worth continuing to pursue. What precisely it looks like in the months and years ahead, I don't know for certain. I do know that we are going to continue to pursue that same strategy and those same goals that we have been talking about for some time. The Chairwoman. Thank you very much. I look forward to continuing that dialogue. I would like further assurance that these programs will continue. Mr. Rogers? Mr. Rogers. Thank you, Nita. Mr. Rogers. Colombia, our anchor, our best partner in the region. A secure and stable Colombia is vital to our own national security. In fact, Presidents Trump and Duque met just yesterday at the White House, but they need our help. There is no doubt about it. They are being swamped by a mass exodus from Venezuela, their neighbor. I am told that there are now 4\1/2\ million Venezuelan refugees and migrants living abroad, including 1.7 million in Colombia alone, a reported 2,000 refugees crossing the border every day. Are those numbers accurate? Mr. Green. As far as we know, those numbers are accurate, and they are projected to go to as high as 6 million by the end of this year. Mr. Rogers. Well, the President is almost desperate, Duque, in his request for help. Ongoing political, human rights, and socioeconomic developments in Venezuela compel growing numbers of children, women and men to leave for neighboring countries within Latin America and the Caribbean, and, of course, they share a very long border with Colombia. Is there extra help that we can get to them to deal with this growing problem? Mr. Green. Congressman Rogers, I think you have put your finger on it very well because it is two different things. So there is the support that we continue to provide for both Venezuelans, who are residing in Colombia and have gone throughout the region, as well as support for the host communities as they deal with the burden of those migrants who have come over. But separately, it is also important for us to deal with Colombia as our close ally and their own development challenges. And so we have invested heavily in some programs that I know President Duque is extraordinarily pleased with and very supportive of. For example, he often points to a land titling project we did. I used to be a real estate attorney. Nobody ever thanked me for title work before, but the work that we have done in a city of 1 million people in Colombia created the first-ever fully titled, fully land-tenured community, and that creates tremendous opportunities for economic empowerment, particularly for marginalized communities of women. But we are not only trying to help Colombia deal with the cost of those who have fled there from Venezuela. We are trying to help Colombia as our development partner and diplomatic partner strengthen their economy, bring about peace and reconciliation, bring governance to largely ungoverned rural areas. So it is important on both fronts, and it is work that we are absolutely dedicated to. And, again, I want to thank the members of the committee for the great support that you have shown and the special attention. Your staff has traveled down to Colombia, met with Colombians as well as some of the Venezuelans who have fled over, and we really appreciate the support and counsel. Mr. Rogers. Well, Colombian President Duque says the very existence of the region is at stake here. Is he overstating the problem? Mr. Green. I think it is one of the most underappreciated challenges in our hemisphere. When we talk about the challenges of displaced communities, I think most Americans think of the far corners of the world, but this is our neighborhood. And you are exactly right, the Venezuelans who have fled, 4\1/2\ million-plus, on their way to 6, many have gone through Colombia. They are not just going to Colombia. They are going to many other countries, Peru and Ecuador, and, in some cases, up to the Caribbean. It imposes tremendous cost, and it has an impact upon the provision of social services, access to education, food security, and economic growth. So it is very important that we continue to focus on this region, both on the humanitarian side, but also looking for ways to build some resilience in these communities because at this point, we don't see that tide, if you will, of forced migrants slowing down. It is 2,000, 3,000 to 5,000 per day at some points, and those are enormous costs and have real impact. So we need to focus on both. Mr. Rogers. Thank you. The Chairwoman. Mr. Price? Mr. Price. Thank you, Madam Chairwoman. Good morning, Mr. Green. Glad to see you. I appreciate your being here today. And I want to start by remarking that I feel we are in a particular position to appreciate your good work, to value your good work, on our bipartisan House Democracy Partnership. Our mission is to work collaboratively to strengthen parliamentary institutions in developing democracies, as you very well know. We simply could not do what we do without the National Democratic Institute, the International Republican Institute. They are funded directly, of course, through the National Endowment for Democracy, but they are often funded in the countries we are working with through grants and cooperative agreements with USAID. When we are in these countries, we also, of course, see broader evidence of your good work and your engagement, the contributions you make to almost all of our 24 partners. And as you might expect, we may have some specific ideas about the treatment of these countries in your budgets, and we will be wanting to work with you on that. We do look out for these countries, and we value their transition to democracy and sometimes how fragile it can be. Speaking of which, I want to ask you about Central America. When a country is in bad shape where citizens are fleeing for their lives, it seems that it would be in our national interests to try to address the root causes of this out migration, and to fund programs, often through your agency, that seek to do that. But that isn't what we've seen in this administration. Since March 2019, this administration has cut or withheld almost all foreign assistance, including humanitarian assistance, to the Northern Triangle countries-- that would be El Salvador, Honduras, and Guatemala--despite Congress continuing to appropriate this funding. So obviously one issue is the merits of the case. The other is contravening congressional intent. It is my understanding that of the $1.66 billion Congress has appropriated to this region since fiscal 2018, the administration has invested only $200 to $300 million, often accompanied, as I am afraid we are all aware, by the President's punitive rhetoric. So I want to ask you about that. There have been over the years a lot of advocates, bipartisan, all over the ideological spectrum. Most famously, I suppose, General Kelly when he was commander of SOUTHCOM. There have been a lot of advocates for this kind of support for these countries, this kind of home country support to address the conditions that often prompt out migration. So I want to ask you about that, of course, but I also want to ask you to take a few steps back, and maybe this will help us understand what is going on here. What would you say more generally about the potential of foreign assistance in these situations? Foreign aid can do some things. Other things it cannot do. Humanitarian development and economic assistance, what is the potential, in Central America or anywhere else, to address the root causes of people fleeing the country, out migration? So we are concerned about these cuts. I am very concerned about these cuts, but also concerned about the general proposition that we are overlooking a potential that foreign assistance gives us to deal with a critical international issue. So that is what I would invite you to reflect on. Mr. Green. Thank you, Congressman. Very quickly, on HDP, thank you. I think that the HDP partnership is a very important one. I will say very quickly just to plant the seed, we have a number of countries that are emerging into democracy, and they often lack a couple of things that we sometimes assume are there. Number one, transparency. They may not have any experience in transparency, and I think we can help strengthen that much to their benefit. But secondly, separation of powers, and you and I have spoken about this. There is not enough investment in legislative oversight. State, USAID, we tend to deal with the chief executive, the executive branch. I am a big fan of HDP because it is an important program in that area. Secondly, when it comes to the displacement challenges, there are a couple of parts to it. Number 1 is root causes, you are correct. And we have been working, while we are in this pause, from development assistance into the Northern Triangle, to develop methods for better calibrating the geographic sources from which out migration is coming so that when we are able to get back to full work when the administration is satisfied that we have strong and willing partners in our host country governments, that we can better focus some of those programs. But the other piece that you are focusing on or that you are pointing to, I think, is the challenge that is perhaps not addressed enough by all of us. I don't know that we have got all the answers. So as Chairwoman Lowey pointed out so well in the opening comments she made, we have got 71 million displaced people in the world, and we have a generation that is growing up displaced either in camps or in displaced villages, and I truly worry about their connectivity to the world around them. So we have to look at such things obviously as nutrition and health, education and how we provide education in these disparate settings, but also, more broadly, connectivity. How do we help young people connect to the world around them so that as they grow up, they are ready to contribute to a more stable, peaceful, prosperous world? It is a daunting challenge, and I can't tell you I have got all the answers, but it is what is causing all of us to think a great deal and reflect upon what tools can be developed. So you are right that we have got not just in the Northern Triangle, but in many places of the world, a couple of sets of challenges. Addressing the root causes that often drive people, which is often insecurity, lack of opportunity, oppression, conflict, but also those who are in motion, how do we help them so that we aren't locked into cycles where people become vulnerable to the worst kinds of exploitative forces in the years ahead? So that is something that is causing us to think of a great deal, to reflect, and we look forward to working with you on it because I think it is a daunting generational challenge for us. Mr. Price. Thank you. Thank you, Madam Chair. The Chairwoman. Thank you. Mr. Fortenberry? Mr. Fortenberry. Thank you, Madam Chair, for holding this important hearing. Administrator Green, Congressman Green, Ambassador Green. I never know what to call you, but welcome to the hearing. Thank you for obviously what is a long and distinguished career in public service. I think you have one of the best jobs in government. It is tough. It is difficult. Sometimes it is hard to explain because there is honestly a lot of fragmentation. There is a lot of variation to the types of problems that we have. The United States continues to lead the world in terms of humanitarian relief, and, frankly, charitable generosity, and you are at the point of that. So I am grateful for that. I want to point something out to you. I wrote to the Government Accountability Office coming up on about a year ago and asked them to basically do a mapping strategy for all the food security and assistance programs that America has that we are engaged in in terms of multinational organizations, as well as touching upon the myriad of nongovernmental organizations that touch this space. As you are quite aware, food security is the foundation for stabilization as well as human flourishing. So I would like you to address that question, how well food security through our myriad of important programs, whether it is Feed the Future, Food for Peace, the variety of other outreach efforts that you have through the micro types of programs that are there, are being fully integrated and socialized as, again, that foundational piece of your work. So that is just a broad comment. Second, and I would like you to comment on it, but secondly, the same thing goes with conservation and biodiversity. As we are moving forward in this century, emphasizing the need for environmental security is absolutely critical. A holistic approach that includes persons and things in place-based strategies is absolutely essential, in my mind, to your work. Again, please address how well we are doing. There is a new idea floating out there that is tactile. It is real. Individuals and communities can embrace it. It is the planting of trees as a way to stop deforestation, again provide stabilization for biodiversity and address the issue of carbon in the atmosphere. And finally, if we have time, I want to talk to you a little bit about Northern Iraq and your efforts there. Mr. Green. Thank you, Congressman. Any one of the topics you have raised, I think, might be the topic for a good hearing unto itself. First off, on food security, it allows me to point out that on this subcommittee and at USAID, we have the great privilege of working in an area in which every administration in modern times has created important tools. And Feed the Future, which was created during the Obama administration, is a marvelous tool that we are all very excited about. We have continued to prioritize investments in food security through Feed the Future with the Global Water Strategy as well, nutrition priority countries, and resilience-focused countries. All of those tools come together. In terms of how we are thinking about it, in the transformation process, we have recently launched a new Bureau for Resilience and Food Security, recognizing that food security is not simply a matter of providing food stuffs. It is also building some of the resilience to help communities withstand future shock. Plus on top of it, the greatest opportunities in most parts of the world for economic growth for surging economically are in the food security area. If you don't get food security right, it is very, very difficult to go very far and to provide opportunities for your young people. So in the transformation process, we are elevating it and making sure that resilience goes along with food security. Conservation and biodiversity, you and I share a great passion. I am a big supporter of the CARPE Program, which is our longest and largest biodiversity program, as well as the DELTA Program. But not only is it important for the goal of pursuing biodiversity in and of itself, which we elevate in our metrics, but I also want to point out that those efforts at combating wildlife trafficking are particularly important right now. If you look at where in recent years the most dangerous infectious outbreaks come from, almost all of it has some linkage to zoonotic causes. So tackling wildlife trafficking is not only a good conservation measure. It is a good health measure, and it is increasingly important. So, again, it is going to be elevated and prioritized in our work going forward because it is also a matter of health security. The Chairwoman. Ms. Frankel? Thank you. Ms. Frankel. Thank you, Mr. Green, for being here. I want to add my compliments to your organization. I have traveled all over the world. I have met with many of your workers, the NGOs that you fund, and I just add the compliment. So don't take---- Mr. Green. My job is usually to get out of their way, quite frankly. They are talented. Ms. Frankel. So don't take my questions personally today. First, I think I will start with a story, and then I want to ask you a question relative to that because I actually had a visitor in my office a couple months ago. Her name was Celeste. She was 31 years old. She was a mother of two children from Mozambique. And I am not sure I met her or somebody who knew her, but here is the story. She had lost her husband to AIDS in 2017 and turned to the Mozambique Association for Family Development for help when she discovered she was HIV positive. The clinic set a routine for her, and she told me that if it wasn't for these visits, she wouldn't be alive. There is a however to this. Apparently when there was a cut from this clinic's money because of the expanded gag rule, it shut down, and basically she had no place to go. So my first question, because I think people maybe don't understand this, and maybe you could explain it. I know that Federal money is not allowed to be used for abortion. Is that right? So we are not going to argue with that. I don't agree with that, but I am not going to argue that today. In the past, other Republican administrations have had what is known as its gag rule, which would affect organizations that did family planning. My understanding is under the Trump administration, with what I call its abortion obsession and its desire to placate the very extreme right wing of Americans who are obsessed with abortion, that now the whole gag rule is now applied to all healthcare money, and so that it is not just in family planning, but also in healthcare. So if you could just explain that, if that is true, and what is the size of that amount of money that is being affected? Mr. Green. Thank you, Congresswoman. So it does apply to basically all healthcare funds, but I think the important thing to remember is it doesn't reduce healthcare funding one dollar. So the overall funding that is provided for our global health work is not reduced by the PLGHA. Ms. Frankel. Well, it is attempting to be reduced here in your budget by a very significant amount, which I would hope you disagree, but I am not going to put you on the spot. The fact of the matter is, I guess the question is, is there any data now that you have that indicates whether or not all these NGOs or these clinics that have been defunded have been adequately replaced, because I just gave you an example of a clinic in a small village that was doing all the healthcare for the village. It has been defunded. Have there been replacements? Mr. Green. So let me answer that with a couple of points. So first off, you began by referencing PEPFAR and the important AIDS work that is being done. Ms. Frankel. Yes. Mr. Green. Some of that obviously I will defer to Ambassador Birx for. But I know that she has said publicly that under the budget request, all those who are on ARTs, there are sufficient resources for that to continue. Secondly, on the question you are posing of all of the organizations for which PLGHA is applicable, the vast majority have agreed to the conditions that are at the heart of PLGHA. And those that have not, obviously it is on us then to endeavor to make sure there is a smooth transition to the continued provision of those services. I know that there is an overdue report to you and to this committee. It is overdue by a ways, and it is in the interagency process. We will, as we have done before, make sure we report to you completely and accurately what the numbers are to help address your question. Ms. Frankel. All right. Are we going to have a second round of questions? OK. The Chairwoman. Yes. Ms. Frankel. OK. Thank you, and I yield back. I will ask my other questions later. The Chairwoman. Mrs. Roby? Mrs. Roby. Good morning. Thank you, Madam Chair, and thank you, Administrator Green, for your testimony before our committee today. And I know that the chairman already asked about Afghanistan, but it is very, very important to me as well. And throughout my time in Congress, as you know, I have had the opportunity to visit Afghanistan 8 times, and looking forward to my ninth trip coming up. The time that I have spent in Afghanistan has been truly impactful for me, both as a member of Congress, but personally. And the purpose of our trip, of course, is to spend time with our troops, and we usually try to schedule this trip in and around Mother's Day to be with our female troops on that special day who are away from their families. But we also have the unique opportunity to spend time with Afghan people, and especially Afghanistan women, in various regions throughout the country. And whereas, again, I know this has already been brought up in terms of the AUAF, but as we look towards peace in Afghan and we hope for, of course, a conflict-free future, the path forward needs to be thoughtful and methodical. We cannot lose the gains that we have made, especially as it pertains to women's rights. So I am going to give you yet another opportunity as it relates to USAID, what does the future of humanitarian aid to Afghanistan look like? And so not to repeat the questions that have already been asked, but looking at a long-term strategy towards ensuring stability in that region. And, again, I think probably the best word that we can use as it relates to these incredible gains that have been made is that they are very fragile. And so I will let you address that. Mr. Green. Thank you, Congresswoman, and thank you for the attention that you have paid in your travels. You know, I think Secretary Pompeo has put it pretty well. There are challenges obviously even with the signing of the peace deal. Progress has been made. Right now we have a real opportunity, and we have to call upon the Afghans to seize the opportunity obviously. More specifically to your questions, humanitarian assistance, we will continue to provide humanitarian assistance. I think we all recognize that humanitarian assistance is treatment, not cure, so we are all hopeful for the day where it is not necessary. It is necessary right now, and we will continue to provide that as we can. More importantly is the development assistance and helping secure, lock in the tremendous progress that has been made in terms of women's empowerment, economic empowerment involvement in communities, and educational opportunities. That is something that is very important to us, and we will continue to work in that area. We have also been working in the region to help secure MOUs to try to build some regional energy markets. There are real possibilities there. It is very hard for a country like Afghanistan to really seize its future with the limited electrification and energy, the connectivity that is there. So that is something that is important to us as well. But we all want to see success, and we all want to build on the progress that has been made. Mrs. Roby. And last year you gave us an overview of the current transformation project being undertaken at USAID, and I understand one component of the transformation process would be to reevaluate how a country's socioeconomic progress is measured. So as it relates to Afghanistan or anywhere else, what are the markers that would be used to determine a country's success? In other words, what kind of metrics does USAID, and we have talked about this one-one-one before, use to make future funding decisions? And I think that is really important, particularly as it relates to outcomes, not just inputs. Mr. Green. Right. Mrs. Roby. You know, we can talk all day here about what we are doing and what we are investing, but I think it is important for us as we speak back to our constituents to be able to talk about outputs. My time is running out, and maybe I will save this for round two, if you want to just put that in your back pocket, and I will revisit this in the next round. The Chairwoman. Thank you. Ms. Meng? Ms. Meng. Thank you, Madam Chairwoman, Mr. Ranking Member, for holding this hearing, and thank you to Administrator Green for being here and for your work. There are currently more people who have been forcibly displaced than at any other time in our history, 70.8 million according to UNHCR. At least a whole generation of children have been born and will live their formative years in refugee camps. In light of this, I am particularly concerned to once again see that the President's budget includes plans to decouple refugee programming from the diplomatic efforts of the State Department by transitioning almost all MRA money to the International Humanitarian Assistance Bureau, even though this was expressly forbidden in the fiscal year 2020 SSFOPS appropriations. Two questions. One, how do you envision the balance between the diplomatic and developmental roles required in U.S. engagement on these refugee issues? And two, what is your ideal breakdown between PRM and a future IHA when it comes to the use of the MRA money? Mr. Green. So in places all around the world, we work hand- in-glove with the State Department. There really isn't an issue. We each have roles to play. We each have capacities to play. Obviously, State has the diplomatic lead, and it should, and in each place where we work, the chief of mission is obviously the State Department. And so the goal, I think, for all of us is to make sure that there is integration, that it is seamless, that there isn't duplication. Our role is operational. Our role is not only to move money, but to measure results and to make sure that we are nimble enough for changing needs. So I don't really see an issue. It has worked quite well, and we continue to work on better integration. I will let you pose some of this to the State Department, but I think both sides right now are comfortable with the approach that we are taking to make sure that there isn't either a seam or an overlap. You know, I think the challenge is increasingly that what we are seeing are communities in motion, and sometimes the distinction between internally-displaced persons and refugees is a relatively artificial one, and it is a moving target. And so I think what both State and AID are trying to do is to make sure that we are appropriately postured for the terribly complicated nature of these quickly-emerging challenges. So that is sort of how we view it. Ms. Meng. Are there any risks to doing this? We were told during the rollout of the budget that there are plans to co- plant or co-locate the departments? Mr. Green. We are co-located in most places, so I guess I am not sure I see either an issue or a risk. Again, we both have roles to play, and, you know, we are not in places without State Department approval, and we fall under chief of mission authority. Mr. Meng. Thank you. I wanted to follow up a little bit. We started talking about youth. Whether here in the U.S. or abroad, young people have long been at the forefront of building peace in their communities by creating youth-wide movements, organizations, and networks to mitigate negative effects of conflict and to prevent recurring cycles of violence. Inclusive peace processes are proven to more holistically address the root causes of violence and lead to more sustainable peace. Especially in countries in conflict, it will be the young people who bear the burden of sustaining the peace over generations. What kind of outreach is USAID doing to ensure that organizations led by and serve young people are engaged in conflict prevention strategies? Mr. Green. I think you put your finger on a really important topic and challenge and opportunity. So I have just returned from a visit to Tunisia, my second time there personally. I was there in a previous capacity. But as we know, it was young people in Tunisia that essentially led to the crafting of the most progressive constitution in the Arab world. And so I took the opportunity to meet with youth representatives several years later and say, OK, what do you think and where are you, and it was great to see that they had not lost their dedication and enthusiasm. They saw that there were some practical challenges that needed to be worked on. My money is on them because that energy, I think, will carry Tunisia forward, but it is that kind of involvement that I think is a good model for many places in the world. For most of the displaced challenges that we are talking about, you are dead on. I mean, it is young people who we have to point to for the future. They are the ones that, if we fail to provide them with tools and experience, will be locked into cycles, and we won't get to where we need to be, so I think it is very important. Finally, something else that I don't think gets perhaps enough attention is we talk about the challenges that we see from the Chinese model, for example, of development and assistance. I worry a great deal that young people may not even realize that their future is being mortgaged in terms of debt distress, but oftentimes loss of natural resources and biodiversity. So it is important that we involve young people up front early on so that they get to help realize their birthright and claim that future that you are pointing to. Ms. Meng. Thank you. I yield back. The Chairwoman. Thank you. We are going to begin a second round, and we will continue as long as you are gracious enough to give us your time. Thank you. I would like to continue on the Mexico City issue. It was February 2018 that the administration indicated that its 6- months' assessment was too early to determine the policy's impact, and that a complete report would be provided by December. I am still waiting for that assessment. Meanwhile, the administration has issued ``clarifications'' to the policy that make it even more problematic for overseas partners. So, first of all, when can I expect this assessment? And in June 2019, The Lancet published a study on previous implementations of the Global Gag Rule, and found that abortions went up by 40 percent in countries dependent on USAID health programming, while contraceptive use when down 12 percent. So how can the United States continue to implement a policy without knowing its effect? Mr. Green. Thank you, Madam Chair. First off, you are overdue for that assessment. The 6-month report that you pointed to, because it caught many programs or projects midstream, that is why we all felt it was too early to fully understand the impact of the new policy. The next report is overdue, and it is in the interagency, and I will do my best to get it to you as soon as we have it available. You are certainly due that. With respect to the second part of your question, the administration is confident that we can continue to meet our global health goals at the same time that we prevent taxpayer money from directly or indirectly supporting organizations that perform or actively promote abortion as a method of family planning. And, again, the report is due to you, but it hasn't reduced dollars, and as far as I know, we have not had material disruptions in services. But, again, that report is due to you. The Chairwoman. I know you are carrying out the policy, and you probably didn't make the policy, but do you think those who did are aware that abortions have gone up 40 percent? Mr. Green. I am afraid I can't answer as to what they might be aware of. The Chairwoman. Thank you. Let's talk a minute about the coronavirus. We are all closely watching the global spread of coronavirus. Disease outbreaks are becoming more frequent. The committee has tried to partner with the administration to ensure that there are funding and flexible authorities to robustly respond. Can you share with us what role, if any, USAID is currently playing in the coronavirus response, and how have USAID investments better prepared countries to respond to such disease threats, and where do gaps remain? Mr. Green. Thank you for the question. So as a general matter, over the years, we have made a range of investments that I think have built the capacity for surveillance, detection, and processing in many parts of the world. In particular, I would point to the university networks that we have invested in that help on animal surveillances. As we have discussed, one of the great challenges that we are seeing is how many of these dangerous infectious diseases are zoonotic in origin. So they are emerging from trafficked wildlife, and so that is something that is of attention or of concern to us. But I do think, as a general matter, the investments that we have all made have built the capacity to detect and to treat. I also think the public messaging networks that have been created are important. We oftentimes underappreciate how important those are. We see it, for example, in the Ebola setting. So much of what we need to do in interventions and in the case of coronavirus and, God willing, eventually a vaccine, require clear messaging to the public so that they are coming forward or that they take the appropriate precautions. Part of what we invested in is that, making sure that we have those networks that are set up. You can see, I think, the success that we have had and the role that we have played in combating the Zika virus, H1N1 flu, West Africa Ebola, and, knock on wood, the winding down of the current Ebola outbreak. But with the case of the coronavirus, there is obviously a great deal that we don't know. And as we see outbreaks, large outbreaks, occur outside of China, for example, in Iran, that creates obviously real challenges for all of us because it becomes a multipolar outbreak source. And so we are working very hard to make sure that we are able to provide PPE, but also boost the capacity of labs in various parts of the world so that we are better prepared. The other piece to it, you know, that we will all be thinking about hopefully soon are the secondary implications. So these outbreaks could destabilize health networks, health systems. We are concerned that they might sort of set back development progress that has been made. The other area that we are concerned about are the risks that some of the countries where we know there is the outbreak are potentially underreporting and not living up to the international health regulations. Those are challenges for us. So in these early days, we know there are a number of challenges out there. We are working closely, particularly with the State Department, to make sure that our resources are applied to the challenge, but, again, there is a lot we don't know. For the Trump administration very obviously, as we all know, the high priority is protecting Americans here at home, and I think you can see that in the early steps that the administration has taken and the team that they have assembled. And we look forward to continuing to support the work of the administration in this. The Chairwoman. Well, I am glad to hear you are involved because, if I am not mistaken, in January 2020 when the task force was announced, it didn't include USAID or the Defense Department, which were the two primary players in the Ebola response in West Africa. So I think my time is almost up, but I am glad from your remarks that you are being included in the discussion. Mr. Green. To be clear, we are not members of the White House Task Force, but we certainly---- The Chairwoman. Is that a mistake? Mr. Green. So we are not members of the White House Task Force, but I can tell you that we are contributing in the interagency and making sure that our assets are brought to bear. The Chairwoman. Does the White House understand when they create a task force, if they leave a critical agency out of it, or doesn't it make any difference? Are you still putting in your 2 cents---- Mr. Green. I would never say it doesn't make a difference. I will say that---- The Chairwoman. But you can correct them and say, ah, you forgot about me. Mr. Green. So, again, and we continue to do things first off, for ourselves. We are organizing ourselves and posturing ourselves so that we are better organized to be able to contribute. And secondly, we continue to provide information to particularly the State Department, members of the task force, and we work pretty closely with CDC anyway. I have regular phone calls with Dr. Redfield, so the information flows are solid. They are good. The Chairwoman. I get it. Well, I am delighted. Even though you weren't made a formal part, I am glad they are taking advantage of your expertise. Thank you. Mr. Rogers? Mr. Rogers. The U.S. Indo-Pacific strategy, your efforts, our efforts to improve market access, promote fair, free, and reciprocal trade, and help countries resist coercive economic practices. We have provided $2.9 billion from State and AID to Indo-Pacific nations for development and economic growth since the start of the Trump administration. But on the other hand, there is China. Over the last 15 years, China has fueled one of the most dramatic and geographically far-reaching surges in official peacetime lending in history. China's massive Belt and Road Initiative symbolizes Beijing's new role as a provider of development and export credits and development financing of all sorts, spanning roughly 80 countries. It can claim to cover more than two-thirds of the world's population. It could include Chinese investments approaching $1 trillion, seven times what the U.S. spent under the Marshall Plan. Seven times. It intends to strengthen hard infrastructure with new roads and railways, soft infrastructure with trade and transportation agreements, even cultural ties with university scholarships and other people-to-people exchanges. The most distinctive feature of the Belt and Road is its lack of transparency. Few outside the Chinese government and development agencies that do that lending, and the governments and state-owned enterprises that do the borrowing, know what the loan terms are. By limiting outside scrutiny, the Initiative's lack of transparency will give Chinese companies an edge in risky markets, and it allows Beijing to use large projects to exercise political influence, an un-American type of program. Understanding that the U.S. response has to come from different agencies, lots of them, what is AID's role and your strategy to counter this China model? Mr. Green. Great question. So, first, I think, as a general matter, part of what we are trying to do is help partner countries understand the bargain involved in the very different models that are out there. So the model that we offer our assistance partners is one of self-reliance. We want to help countries undertake the reforms and make the commitments that are necessary to become self-reliant, and that is what we offer at the end of that journey together. China and other authoritarians offer something very different. They want dependency, just the opposite of what it is that that we offer. And so our job, part of it is to make clear that distinction. Secondly, in more specific terms, we have some tools, particularly in the Indo-Pacific area, that we have provided to partner countries to help them objectively evaluate some of the deals that are being offered to them so that there is an objective understanding of the consequences. So it may be, you know, a cash fix up front, but the long-term consequences in terms of loss of assets and debt distress are significant. On top of that, reference was made to the indicators that we use to help guide our investments and to also guide the diplomatic discussions that we have with our counterparts. In this year's, what we call, road maps, we have provided a debt distress indicator to help understand how close a country is coming to what the World Bank would point to as significant distress, and make sure that that is out on the table and in public for the discussions that we have. Further, USAID's role in all of this is to help take on the enabling environment. So what is it that stops American companies from investing in many of these countries? It is usually not capital. Capital is there. Capital is available. It is rule of law. It is regulatory predictability. It is the kind of transparency that you pointed to. So in the work that we do, we have tried to strengthen those aspects of governing institutions, very confident that if we are able to make those changes and reforms and strengthen it, that American business investment will take off. Market-based investments will take off. And, you know, we all know that market-based economics are the key to realizing the future for many of these countries. And so those are the reforms that we undertake. Finally, in terms of the Indo-Pacific itself very specifically, we are increasing our presence. We are adding U.S. Direct Hires. I am planning on heading to Australia soon to do a development dialogue with our friends in Australia. We hope to have a Senior Development Advisor there which will help us as we coordinate investments and reforms in the Pacific Islands and in the region. So we are increasing our presence, doubling down on our enabling environment work, and also hopefully doing a better job in helping partner countries understand the costs and the benefits of the various models. Mr. Rogers. Thank you. The Chairwoman. Mr. Price. Mr. Price. Thank you. Mr. Administrator, I want to first thank you for your answer to my question in the first round, which had to do with the cut off of funds to the Central American triangle countries that are designed to address the forces behind out migration. I want to give you a chance to say anything more you want to say about that, but then I do want to turn to another issue. But I do appreciate those reflections on the potential of foreign assistance to address the root causes of out migration. Such aid is, of course, going to be limited. Even under the best of conditions it will be limited, so it has to be targeted effectively. What I didn't hear you say, that it was helpful to cut it off completely or almost completely, which is what the administration has done in Central America. It is hard to see how that is constructive or helpful, and it is also important, I think, to note how hard it is going to be to start it up again. I appreciate you are anticipating that it will be started up again, but the implementers, mainly nonprofits, tell us that the cutoff has prompted distrust in affected communities. It has prompted an erosion of cooperative ties, and they are not going to be repaired overnight, so I appreciate your comments on the potential of such funding. And I am bound to observe that when you compare this funding to $13 billion being diverted from U.S. defense programs to build a border wall, and that border wall does nothing to address asylum seekers, who are, after all turning themselves in, the money we are talking about for these home country efforts is far less than 10 percent of that misbegotten wall funding. Now, let me turn to a critical country in our hemisphere that I am sure we have a lot of discussion going on about what on earth we do about the current lack of functioning government in Haiti. What is the potential here? What is the ability of USAID and other donors to carry out programs in Haiti? If we take a sober look at what is happening there, helping Haiti promote citizen responsive governance, including our work at HDP with the parliament, it is just not feasible in the current impasse. Both houses of the parliament, with the exception of a small fraction of the senate, have, in fact, lost their mandates because there have not been timely elections. So what is USAID doing to assess the problem, to fix the problem? No other country is in a position to take the lead in this Haitian situation. How do you assess the difficulties in governance, just basic governance, holding timely elections, other such functions? And what is your assessment of what we or anybody else can do about it? Mr. Green. Thank you, Congressman. I have made a couple of trips to Haiti during my tenure, most recently just weeks ago, and it was obviously disturbing to see the violence that was taking place, disrupting the ability for kids to go to school for weeks on end, the ability for small businesses to get parts necessary to move forward. Yeah, deeply, deeply disturbing. So a few thoughts. First, the good news is there are a number of heroes in Haiti. Small organizations, many are faith-based, not necessarily all, but some of the hospitals that I have seen and small schools that I have seen, even under trying circumstances, creating opportunities. I want to do everything I can to ensure that resources are available to build on this work, because right now with the dysfunction in the government, it is the people, it is the everyday families that are suffering terribly. And I think we are all deeply worried about a lost generation in Haiti. Secondly, there are seeds for hope. I visited a small banana farm, if you will, where they were doing some mechanization. But there was a wonderful cooperative in which they were training everyday Haitians to take on all the aspects of upgrading the operation so that the fruit can be exported into the international stream of commerce, which is the future to be able to export. The frustration of that day is they got ready to show me the operation of the farm, and only one of the lines was working because the violence had disrupted the truck traffic necessary to get the parts for the other lines. And so I saw both the hope of the future and just the frustration of the present. I have met with President Moise, and I expressed my deep, deep concern about the dysfunction in the government. And, you know, in the short term, we are bound and determined to do some humanitarian assistance, again, treatment, not cure. I can't promise you that we can always get humanitarian assistance everywhere we would like to because of the security situation, but we want to build upon some of these heroes I referred to. And finally, as I indicated to a number of people, I think the only way that you begin to restore people's faith in government there is you need some kind of special prosecutor on corruption. Until people see a couple of the big guys, using that term, behind bars for corruption, I think it is really hard for people to have a lot of faith in their government. And so we are looking at the opportunities and ways that we can play a constructive role in that. Haiti is our neighborhood. We are not going to give up. We refuse to give up. Haiti matters to us. It is a country of great interest, concern. There are so many linkages. But it is challenging work, to say the least. Mr. Price. Thank you for those comments, and I couldn't agree more about the corruption issue and how central that is to building trust. Let me just say--my time has expired--but I would just make the comment that governance is basic to everything else. And I remember very well urging Secretary Clinton after the earthquake that attention be paid to the literal collapse of not just the buildings that house the government, but the near collapse of the government itself. And so I think you will have the support of this subcommittee as you address that aspect, that critical aspect of what we all agree is a devastating situation. Thank you. The Chairwoman. I would just like to take the privilege of the chair because I appreciate my colleague's remarks regarding Haiti. This has been an obsession of mine, and most frustrating because we can't seem to do anything. I hate to say it, but when I look back, and I was there, I think it was at least 50, 60 years ago, with Papa Doc. I hate to say that. At least people weren't getting killed on the street. I would really like to work with Mr. Price and my other colleagues, and with you. I recently met with Ambassador Sison again, and before that, we have had other capable people from USAID and from the State Department working on Haiti. We don't have terrorists there yet. It is right here as a neighbor. Well, there are many things that are frustrating to me. I won't say it is the most, but it is among my top, and I would like to work with you, and Mr. Price, and others to see, I am not sure if it is more money, or more people. But we have had the best people focus on Haiti, and we can't seem to make a change, and people can't live decently. The crime is everywhere. And yet I had an experience within a group where I was complaining about Haiti, and one person raised their hand. She said I am part of a group, a medical group, in Haiti, and we are doing excellent things, so it is all not bad, but we understand the huge challenge. And I would like to say for myself, Mr. Price, and others, who really are desperate to try and find some solutions that work, we would like to work with you. And I am not sure if it is money, money and focus. We have tried everything, so I just want to say I agree with you, my good friend, Mr. Price, and I know many of us feel the same way. Mr. Green. Madam Chair, I will just say that the committee has been extraordinarily helpful. We have met with staff, had bipartisan meetings with staff actually before and after my recent trips, and I think there is broad bipartisan support looking for answers and willing to try most anything. We look forward to continuing that conversation. We all recognize how important this is. The Chairwoman. Thank you. Mrs. Roby? Mrs. Roby. Thank you, Madam Chair. So I will go back to the question where we left off. So under the transformation plan, what are the markers that would be used to determine a country's success? In other words, what metrics will USAID use to make future funding decisions? Mr. Green. Thank you. So what we try to measure are, and I think you put your finger on it, we are not measuring inputs. We are not even measuring outputs. We are measuring outcomes. We have 17 third-party metrics that we use that measure both a country's capacity in each of the key areas that we work on and are identified by our stakeholders, but also a commitment because if our host country partners are not willing to put their own skin in the game and undertake reforms, then, quite frankly, we are largely wasting our time. And so what we try to do is to plot where countries are. It is not perfect. There aren't perfect metrics out there, but we try to use it to guide our discussions. In a perfect world, what we hope to do is to have our investments prioritized according to those metrics. I understand that there will always be superimposed directives and priorities, whether it comes from the administration or it comes from Congress, and that is simply the way the process works. None of those, however, is a problem in terms of the broad way that we proceed. The most important thing that we get from our metrics, not just how it guides our investments, but it guides our discussions. And I found, when you sit down with your host country partners, and you have, for lack of a better term, honest adult conversations and say, look, you know, we are not saying we got all the answers, but this is what we see, and this is how we think we can be helpful, in almost every case I am aware of, the host country partners say, great, let's sit down and see what we can craft together. So we are interested in outcomes instead of outputs, not simply looking at the programs, but how they build the capacity of a country to eventually take these challenges on themselves. We add to it, I think, a prioritizing of domestic resource mobilization, helping them more effectively and efficiently capture their own revenues. Again, it is their country. They need to put investments into these areas. Otherwise, they become, for lack of a better term, a dependent, and no country wants to be that, nor should want to be that. So we are really trying to move in a direction in which our host country partners see us as honest friends walking along a journey with them. Mrs. Roby. Thank you, and thank you for the work that you do. And, Madam Chair, I yield back. The Chairwoman. Ms. Lee? Ms. Lee. Thank you very much, Madam Chair, and thank you for being here. Good to see you. I come from the State of California where, unfortunately, childhood poverty rates are the highest in the country, if you can believe that, from the Golden State of California. My district is one of the highest, so it is a moral disgrace, and that is what we are dealing with across the way. So thank you again. I apologize if these questions are redundant, but let me ask you, first of all, and I will try to put all the questions together. The budget cuts in HIV/AIDS funding through PEPFAR. This has been bipartisan. We are trying to achieve an AIDS-free generation by 2030, yet you have cut it by, I guess, $1.5 million below the 2020 enacted amount. I don't know what in the world could be the justification for this, but I would like to hear your answer on that. And also the Global Fund contributions. You know, we have a 33 percent limit in terms of our share. Now it is down in this budget to 25 percent. Of course, that is going to affect not only our contribution to the Global Fund, but to the operations throughout the world. Second, I want to ask you about, and we have talked a little bit about this, about Gambia. We were there with Congressman Price and our House Democratic Partnership in The Gambia, and we recognized that they really have a new government, great possibilities. They need USAID's presence. And we know there is a regional effort, but we talked to many people there, and we have talked a little bit about this. And I want to see some presence, some footprint of USAID in The Gambia. I think we have a real opportunity there, and I don't see anything in the budget creating that. And so I would like you to talk a little bit about that, if we do move ahead, to try to ensure a presence of USAID in The Gambia. And then let me just ask you about the administration's peace plan as it relates to UNRWA. You know, the administration ended all humanitarian and development assistance to the Palestinians last year, and we know, though, that UNRWA had a 70-year U.S. relationship with the United States. But also we know that not 1 cent of UNRWA funding passes through the PA. Can you kind of explain what is going to take place now under this new peace plan and as it relates to Palestinian assistance? What is going to happen as it relates to the funding for schools and hospitals and humanitarian assistance, and does this administration intend to restore aid to the Palestinian people? So thank you very much. Mr. Green. Thank you, Congresswoman. A lot of topics to cover. So on PEPFAR and the Global Fund, first, I think it is important to note that we remain the largest contributor to the global AIDS effort, as you know. In terms of the specifics on the PEPFAR front, earlier I was asked a question, and Ambassador Birx has indicated that under this budget, the resources are sufficient to continue. All those who are on ARTs will continue to receive ARTs. Beyond that, to be honest, I should defer to her as the leader of the PEPFAR program. One area that I think is exciting, that you and I both think is exciting, is the huge commitment we have now made to GAVI, which I think provides some long-term answers on a number of global health fronts. This is the largest-ever multiyear commitment. We are very proud of that, and I think it is something that we can celebrate. Second, on The Gambia---- Ms. Lee. But we shouldn't reduce it to 25 percent because that is going to mean our leverage ability for the Global Fund goes down. Mr. Green. Right, and that is separate from GAVI obviously. Ms. Lee. Yeah. Mr. Green. On The Gambia, you and I have spoken. I share your concerns, and so we are looking at that. Now, there are some potential restrictions because of trafficking in persons and it is something we are looking at closely. And, again, you and I have discussed that. I share your prioritizing because we have real hope in moving away from an authoritarian past, and we certainly don't want to lose it, and if we do, things don't get better. We know things get worse. So that is something that we are looking at. Ms. Lee. OK. Well, as this bill moves forward, I would like to work with you and Price and our chairwoman to see what we can do in this bill as it relates to Gambia and USAID. Mr. Green. Great. Ms. Lee. OK. Mr. Green. No, no, most certainly. Ms. Lee. OK. Thank you. Mr. Green. On UNRWA, that is better addressed to the State Department. UNRWA related to the State Department. On the peace plan, what I can say is in terms of our West Bank Gaza presence, we have no plans to close it. We are trying to continue our presence there. The 45 local staff that are part of their presence are currently involved in helping USAID programs in other areas and other missions. And we are hopeful for a day when the work can resume as part of the peace plan. Ms. Lee. Thank you, Madam Chairwoman. The Chairwoman. Mr. Fortenberry. Mr. Fortenberry. Thank you, Madam Chair. My children's great-great-great great-great-grandfather was Haitian, and when I met with the Haitian president, I told him that, and he said, welcome home. I missed the fullness of the discussion in this regard, but clearly it is important to a lot of members. Haitian culture, Haitian history is so inextricably intertwined with America. I think there are 11 million Haitians, people of Haitian origin in the United States. Multiple school groups, church groups have connectedness to various projects there, and yet the problem is so vexing of governance, criminality, a lack of seemingly sustainable economic dynamics. Madam Chair, if I could be presumptuous and suggest something. Perhaps we should invite Ambassador, the excellent ambassador, Sison here. And, Mr. Administrator, if you might be able to join in that conversation, to just start unpacking layer by layer. We have a huge amount of resources there. We have done so for a very long time. It just deserves more than 3 minutes here. Perhaps I can talk to the chair afterward about that idea. Mr. Green. I share your love of Haiti. You know, first off, one of the things that always move me when I go to Haiti, and you travel around and you see the buzz of activity---- Mr. Fortenberry. There is a joy on the street there. It is amazing. Mr. Green. Very much so. Mr. Fortenberry. Yeah. Mr. Green. So the problem isn't with the Haitian people. Mr. Fortenberry. Yeah. Mr. Green. As I point out, certainly Haiti has been struck by numerous natural disasters, as we all know. But when people protest, they are not protesting the hurricanes, right? They are protesting an entirely unresponsive government, a government that refuses to get itself in order to deliver even the most basic of services. A quick story. My last trip down there, I was at a dinner with a number of Haitian business leaders, and in the middle of the dinner, one of the leaders got up and walked out. And then they leaned forward and said he had just gotten a phone call to say his brother-in-law been kidnapped. I mean, that is just sort of the daily life that we are seeing there, and we cannot rest with that happening. Mr. Fortenberry. I appreciate your comments, and I am sorry to expedite along here, but my time is just so short. If the chair would consider my request, I would be happy to talk to you afterwards about that. I think some type of working group to get us beyond just the touchpoints in the hearing. In the last omnibus bill, by the way, there is some language that we got included that tries to get you to look more seriously at the border crisis issue with the Dominican Republic, which is one of the underlying factors of disruption of the economy. So let's put that on the side for another day. I want to return back to the food security piece and Government Accountability Office request that I look at this mapping strategy as to how our programs, the other important food security programs costs, World Food Program, can be possibly better integrated to ensure that we are a force multiplier to go to the heart of what this transformational idea is in terms of stabilization and human flourishing. So I want to get you a copy of that. I would appreciate it if Chair Lowey and Ranking Member Rogers would look at this as well. If I could include it in the record of this hearing, I would be grateful, Madam Chair. Again, it is the letter that I sent to the Government Accountability Office. The Chairwoman. With pleasure, without objection. Mr. Fortenberry. Thank you, Madam Chair. And finally, let's turn to the issue of northern Iraq quickly. We have been there together. In this past budget, not in report language, but in bill language, we were finally able to get what you and I have talked about in terms of security. Conceptually, that the ethnic religious minority community ought to be integrated into the national security structures of the Iraqi government. It is clear language. It is pointed to that. We are in dialogue with the Defense Department now. I want you to be aware of that. Can you give me an idea of where we are in terms of economic aid, and then as we move forward on the security component, which would be potentially implemented obviously in strong solidarity and partnership with the Iraqi government, but also by other international partners, how it could lead to sustainability for the hundreds of millions of dollars that we are spending there in terms of stabilization? Could I get your update on that, please? Mr. Green. Great. Thank you, Congressman, and I do remember the trip we took together, and your follow-up on the security front is deeply appreciated. As we discussed then and recently, it is very hard for us to succeed in the goals that we have of creating an opportunity for those in Northern Iraq, religious and ethnic minorities from Yazidis to Chaldean Catholics, to come back, or to at least stay and see it as their home, if we don't get security right. Even in the challenging environment that we all see, there are investments coming in, and we have had some sessions recently on the ground in which we have seen investors come in. I just recently met with a businessperson, who is looking to invest in a bottling and canning operation in the region, so there are opportunities. There is interest. If the environment is secure, if the government realizes that these are not really minorities, but, in their terms, component communities, part of the whole, there is every reason to believe that this can recover some of that wonderful tradition and mosaic of ethnicities and faiths that has been something we all admire in northern Iraq. The Chairwoman. Ms. Frankel? Ms. Frankel. Once again, thank you for your service. I do want to note that the administration has paid some attention to women's economic empowerment in regards to there are a couple of pieces of legislation, the WE ACT. There is a new Women's Global Development Prosperity Initiative. But I just want to say that, you know, there is an old expression, don't cut off your nose to spite your face. It is all well and good that the administration would seek to change property laws in countries or find capital for women's businesses, but when you are cutting the budget to educate girls, there are 130 million girls in this world who are out of school. So this budget is asking to cut hundreds of millions from education. And the other thing is, women have to be and girls have to be healthy to be successful. This budget proposes a billions of dollars cut to global health, which gets me back to our initial discussion of the Global Gag Rule, which I think I let you slipperly slide by. And I want to just read something so people understand what it is and how damaging it is because it is not really about Federal funding of abortion. It is about keeping girls and women from access to full healthcare and to truthful information from the healthcare providers. ``The Global Gag Gule is one of the most deeply damaging policies ever enacted on foreign assistance funding. The gag rule blocks U.S. Federal funding for nongovernmental organizations that provide abortion counseling or referrals, have a gate to decriminalize abortion, or expand abortion services, even when those activities are funded independently of USAID. Reinstated by President Trump shortly after he took office in 2017, the newly-expanded version of the gag rule targets organizations working on any program funded by U.S. global health assistance, including programs that expand access to contraceptives, reproductive healthcare, HIV testing, treatment, and prevention, efforts to fight malaria, and public health programs working to improve child and maternal health outcomes.'' And this, I will agree with those who say, ``represents the most dangerous version of an already-damaging legislation ever stated.'' And just to give an example so that people are clear, we don't allow Federal funding of abortion. That is another issue. But if you go into a clinic, like I mentioned before, in a small village in Mozambique where people get their general healthcare, if a woman who is pregnant even asks the question where can she get abortion, she is not allowed to be told that, or this clinic loses its funding. Even if there happens to be a pamphlet lying on a table that actually doesn't mention abortion, but actually mentions the name of another healthcare clinic or organization that actually gives abortion referral that does abortions, they lose their funding. So, again, I want everyone to be clear about this obsession that is hurting millions and millions of women all over the world now. I am going to ask you a question. You don't have to defend this policy. I am not asking you to do that. I don't think you can. But I do want to ask you about the Women's Entrepreneurship and Economic Empowerment Act, which identified key barriers to women's economic empowerment, including child marriage, female genital mutilation, access to education, gender-based violence. It unfortunately did not mention healthcare, but that is for another day. Could you just tell us whether or not, given especially these suggested cuts, do you have the staffing and training needed to conduct the gender analysis that is required, and to really get into sort of the meat and potatoes of the legislation? Mr. Green. Good question, and thanks for your great support of the gender work that we are all talking about. So the President's National Security Strategy recognizes that gender empowerment, women's empowerment is a national security matter. And feel as though we have, in the last couple of years, gotten some new exciting tools from WE ACT, to WGDP, to Women Peace and Security. And so we are excited about it. And just in the first year of WGDP, 12 million women have been touched and new opportunities created. So we can always do more, but we believe we have the resources necessary to continue on with this work. And we are excited to partner with you and to show you some of the early results, but to keep it going because it is a, I think, one of those great bipartisan areas where there is a very bright future. Ms. Frankel. And, Madam Chair, I want to just add one thing. A lot of people don't understand why we care on this committee and in Congress about healthcare in other parts of the world. Why would we care if somebody in the village has access to healthcare? Why do we care if a woman has access to contraception? Because you know what? If there is no better example of how we are all interconnected is this coronavirus. And when you look at the spread of disease and the spread of terrorism, what we know and is pretty clear, which is why you are in the business you are in. And I thank you again because I think this is such an important part of our government, is that when countries are more prosperous, when they are healthier, they are safer and the world is safer. And with that, I hear the knocking of the paddle there, and I yield back. The Chairwoman. Thank you, and I will yield to Ms. Meng. Ms. Meng. Thank you, Madam Chair. Last week, the GAO published a report on diversity at the State Department, which indicated that under multiple administrations, there has been a failure to ensure that our Foreign and Civil Service reflects our country's diversity. Between 2002 and 2018, the proportion of racial or ethnic minorities working at State full time has only increased by 4 percent, and those in the Civil Service has decreased by 1 percent. This issue is exacerbated as members of the Foreign and Civil Service rise in their careers. The report did not include USAID's workforce, but I wanted to ask a couple questions. One, can you tell us whether USAID's efforts toward a more diverse and inclusive workforce have made more progress than those at the State Department? Two, has USAID allocated funds to expand recruitment to minority communities, and what types of steps are you taking to diversify? Mr. Green. Great question. So I have not read the GAO report, and I am not going to comment on other agencies. What I will say is building a more diverse workforce and, perhaps even more importantly, creating more career opportunities for that diverse workforce, is a very high priority for me personally because I think part of the strength of our Agency and American leadership is to project leadership that reflects America, and so it is a high priority. Our hallmark program for this is the Donald M. Payne Development Fellowships, and I certainly would invite members of the committee to accept Don Payne fellows. They are always looking for opportunities, and we would be very happy to work with you on that. But on top of that, I will say that, and I think, Madam Chair, you know me well enough. I don't like pointing to the past where things have been, where I have seen problems coming in. This is a problem I saw when I first arrived at USAID, and it is no one person or administration. It goes back some years. We are doubling the number of people who are involved in administration of EEOC complaints to make sure that everyone is comfortable and we have a respectful, inclusive workplace. We have tried to create new standards of employee conduct, and we have been training around that. We have tried to create a single point of entry for those who feel as though there have been problems of lack of inclusivity or harassment so that it is easier for people to come forward and report. It is a work in progress. But I will say when I arrived, it was an area in which I felt as though we were lacking. We are not there yet, but I hope and believe that we are making some progress. Ms. Meng. Thank you. Different topic. According to UNICEF, roughly half the schools in low-income countries lack adequate drinking water, sanitation, and hygiene. Lack of privacy and sanitation results in inadequate menstrual hygiene and causes millions of girls to stay home from school each month. What are the advances the global community have made in the area of menstrual hygiene, and what more can be done by USAID and others to ensure that girls are able to simply attend school and stay in school? Mr. Green. Great question, and I know it is a particular concern of yours, and I appreciated that you have always raised the issue as something for us to look at closely. So on one level, we now endeavor to include in our humanitarian emergency response materials appropriate menstrual hygiene materials because we know that is often lacking in those emergency situations. But, more significantly, to your point, you are right that a lack of menstrual hygiene materials and understanding is an important indicator of gender equity. And so we are working to create opportunities to approach the topic in schools, in particular. I am aware of a pilot program we undertook in Ghana that had significant outcomes in improving for young girls and women not only improved self-worth and a sense of independence in being able to pursue opportunities, but actually and, perhaps more importantly, help young men in terms of image and outlook. And I think those are projects that should be expanded because I think, again, it is hard to get at full economic opportunity for young women if they are held back in this way. So you are right to raise it. It is something that we are trying to bolster because we think it makes a difference. The Chairwoman. Mr. Rogers. Mr. Rogers. Mr. Ambassador, we thank you for giving us plenty of time here today with you, and thank you, most importantly, for the work that you are doing. We are trying to put together on the Hill a supplemental appropriations bill for the coronavirus matter. What do you need? In addition to your regular budget, what do you need, besides that, to help fight this matter through? Mr. Green. Thank you for the question, and my team will work with yours. I think one of the important things to recognize when it comes to the broad response is that the coronavirus outbreak is going to create tremendous burdens on a number of healthcare systems, and so I think we need resources to help strengthen and replenish those. I think also we need to recognize that this is going to be a development setback in many countries, and so making sure that there are adequate resources to help bolster the secondary impacts. I think also the most obvious, additional resources to train healthcare workers to both the ability to test and diagnose for the coronavirus. I think additional resources to help health facilities. And I think, in some ways, most importantly, resources to help convey clear, accurate information to the public. What we have seen with various outbreaks over the years, and the coronavirus being the most challenging because it is global right now, covering obviously every continent but Antarctica, is combating some of the misinformation that is out there. We have seen some powers, such as Russia, quite frankly, put out lots of misinformation on the coronavirus in an effort to cause mischief. Whatever we can do to provide clear, accurate information on what it is and what it isn't, on the importance of coming forward, on making sure that people have trust in their healthcare facilities, I think that is a really important part of the long-term solution on this. So there are a number of ways in which we believe we are part of the long- term answer. Mr. Rogers. We thank you for your testimony here today, and we wish you good luck. The Chairwoman. In conclusion, and I thank you for your last comment because it is a perfect segue to an issue which we haven't talked about this morning, and that is USAID Countering Malign Kremlin Influence framework. The Russian government, as you said, is pursuing efforts to undermine democracy, interfere with elections in the United States and in Europe, and fanning the flames of nationalism in Europe. Last year, USAID rolled out its Counter-Malign Kremlin Influence Development framework. I would be interested to know something about it because I know almost nothing. How has the framework impacted USAID programming in the region in results to date? How is USAID supporting regional programs in Europe, including in Central Europe, to address disinformation and rising nationalism? How much funding does USAID devote to civil society and other regional programs in Central Europe? And once again, the administration is proposing significant cuts to bilateral development aid to countries like Ukraine, for which the administration proposes a 42 percent cut; Georgia, for which the administration proposes a 54 percent cut. So how can you explain to us and assert that the administration is serious in pushing back against Russia while proposing cuts to countries such as these that are on the front line of Russian aggression? I know the hour is late, but there has not been any discussion, and many of us are very, very concerned, especially with the elections coming up here. Thank you. Mr. Green. Thank you, Madam Chair. I have actually had a couple of trips to Europe recently. I was at the Munich Security Conference, and then prior to that took my first trip to the Balkans and was in North Macedonia, Albania Kosovo, and Bulgaria. And in each of those areas, we spoke a great deal about the Countering Malign Kremlin Influence framework. So what we are trying to do regionally and, in some cases, country by country, is develop economic independence so that they are less dependent upon, for example, Moscow, for energy sources. Also in some cases, like Ukraine, help strengthen their ability to protect against cyberattacks. In the region, a lot of our attention is now in bolstering transparency in government. One of the best ways that we can think of to counter these influences is to create transparency so citizens are aware of influences, and they are able to push back. I point to, for example, the U.S.-Albania Transparency Academy that we are preparing to launch. We hope it will be not only what the prime minister there is asking for in terms of a tool to fight corruption and malign influences, but perhaps even a model for the region. Another tool that we are working on that I think holds great promise, we often talk about the importance of creating independent, trustworthy media, and that is important. I think we need to go one step further because the other side isn't playing by the media rules that, you know, we believe in. I think it is also media literacy, and it is helping citizens to recognize disinformation, misinformation, malign influences in the media process. That is something we are attempting to strengthen and we will continue to build. So we have a lot of work to do, but we remain committed to countries like Ukraine and their stated goal to look more westward. And we will do everything we can to make sure that they have the tools and resources to pursue that. The Chairwoman. Let me just say in conclusion as I close the hearing, this is a very personal interest of mine. I am passionate about it. And perhaps I can have a roundtable where the people who are working on this issue could come and brief us because I know many of us are concerned about this. So perhaps, first, you can do a memo for us just giving us a better idea of exactly what you are doing, where you are doing, and then we can follow up with a discussion. But as I close this hearing, I want to thank the committee. I want to thank you for your time. This concludes today's hearing, and the Subcommittee on State, Foreign Operations, and Related Programs stands adjourned. And thank you so much for appearing before us. [Material submitted for inclusion in the record follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Wednesday, March 4, 2020 EXPORT AND FINANCE AGENCIES BUDGET REQUEST FOR FISCAL YEAR 2021 WITNESSES THOMAS HARDY, ACTING DIRECTOR, U.S. TRADE AND DEVELOPMENT AGENCY KIMBERLY REED, PRESIDENT AND CHAIRMAN, EXPORT-IMPORT BANK OF THE UNITED STATES ADAM BOEHLER, CHIEF EXECUTIVE OFFICER, U.S. INTERNATIONAL DEVELOPMENT FINANCE CORPORATION OPENING STATEMENT BY CHAIRWOMAN LOWEY The Chairwoman. Good afternoon. The Subcommittee on State, Foreign Operations, and Related Programs will come to order. Chairman Reed, Acting Director Hardy, CEO Boehler, thank you all for joining us today. Unfortunately, the administration has once again signaled its ill-advised and irresponsible approach to foreign affairs by proposing a nearly 20 percent cut to foreign assistance at a time when actors do not share our values. China and Russia are increasingly influencing foreign development assistance. This proposal, if implemented, would be disastrous with no coherent strategy. The budget request demonstrates that the administration does not grasp the impact of global development on our own national security nor the benefit of efforts that promote economic growth while engaging American companies. Though the administration touts increases to private sector engagement in global development, the budget proposes exorbitant increases to some programs while cutting or even completely eliminating others that are proven to have a substantial role in engaging the private sector to invest in risky emerging markets. The administration's proposed shutdown of the U.S. Trade Development Agency is one example of the lack of understanding by the administration and I, clearly, do not support this proposal. USTDA facilitates opportunities for U.S. companies that promote sustainable development across the globe and levels the playing field, thereby increasing exports for American companies of all sizes and jobs for American workers. Further, the agency has secured a $111 return on investment for every dollar spent. That is $111 in U.S. exports for every dollar in invested in emerging markets. It does not make sense, in my judgment, to hold USTDA's ability to provide such results which achieves strategic foreign assistance objectives and, indeed, put America first. EXIM Bank also supports these priorities and helps American companies and small businesses export abroad through financing support and also by reducing the risk for U.S. goods and services to compete in overseas markets. In fiscal year 2019, nearly 90 percent of EXIM's transactions supported small businesses. This promotes job creation and global competitiveness for local American businesses, and now that EXIM is reauthorized through 2026 and has quorum restoring EXIM to its full financing capacity, I am interested in strengthening its ability to ramp up support for U.S. business overseas. I have been proud to support the United States International Development Finance Corporation along with colleagues from both sides of the aisle. However, I am concerned that a 288 percent--you hear that? Two hundred eighty-eight percent increase for a consolidated account line that includes the DFC's Equity Finance Program may be too much too soon. The DFC has only been operational for three months and for this committee to further invest in a new institution we must see evidence of success, which will take time. Building a sustainable institution must be done strategically and with consideration to lessons learned through past efforts, the context of evolving markets and related needs, and data-driven programming. The President's budget proposal focuses on the short term and would both hurt American businesses and damage our local standing. This is particularly concerning now as the spread of coronavirus has disrupted markets and the potential for future shock exists. Fortunately, this committee recognizes that strong sustained U.S. leadership combined with a global effort that leverages private sector resources towards sustainable development helps open global market opportunities. The complementary efforts of USTDA, EXIM, and DFC are critical to this process. This is why I would like to see all of them succeed, which requires adequate resources and thoughtful policy. As chairwoman, I have every expectation that we will produce a bill that maximizes each taxpayer dollar while maintaining responsible investment in export and financing efforts that promote U.S. businesses while supporting sustainable global development. Before we move to your testimonies, let me turn to Mr. Rogers, the ranking member, for his opening statement. OPENING STATEMENT BY RANKING MEMBER HAL ROGERS Mr. Rogers. Thank you, Madam Chair. Mr. Boehler, Chairman Reed, ActingDirector Hardy, welcome to the Subcommittee on State and Foreign Operations. This hearing involves important agencies of the government that are at the junction of development policy and commercial diplomacy. Nearly two decades ago, a distinguished American diplomat wrote that the position of the United States as, quote, ``The best place in the world to do business, the most reliable in which to buy, the most lucrative in which to sell, and the safest and surest in which to invest or raise capital. It is the cause, not an effect, of American global leadership,'' end quote. He went on to say that protecting and expanding the U.S. role as the world's supplier and customer of choice for goods and services, ideas, capital, and entrepreneurial energy should be a foreign policy objective second only to security homeland. That statement is even more true, I think, today. The global economy has undergone a dramatic transformation in recent decades with U.S. competitors using comprehensive national strategies to promote trade and investment through robust export and project finance, extensive technical assistance, and strong political backing from their national governments. We need look no farther than China's ambitious Belt and Road Initiative with its aggressive use of government financing for infrastructure development in emerging markets to see the clear relationship between commercial diplomacy and U.S. national security. The Congress supported creation of the new U.S. International Development Finance Corporation in large measure because of the growing geoeconomic challenge from China. Another motivation was the realization that a more strategic approach was needed to address key U.S. development priorities such as more effectively partnering with the private sector to expand economic opportunities in frontier markets. I look forward to discussing the changes in the DFC's program funding for this fiscal year including financing of equity. I am glad to see that another important tool of our economic statecraft, U.S. Export-Import Bank, has a fully functioning board at last and a new long-term authorization because export credit agency financing is a powerful instrument used by other countries to gain competitiveness for their industry. In the absence of competitive private sector loans, financing from EXIM is often the critical factor in completing the deal. This is particularly true of smaller U.S. companies who may need assistance with supply chain finance. Technical assistance, grants from the U.S. Trade and Development Agency such as for feasibility studies and technology training visits, is also a critical element of their ability to help U.S. companies build relationships with clients in challenging markets. Despite the proposed elimination of USTDA in the budget request, key stakeholders continue to praise its technical assistance as an important tool to neutralize destructive practices by U.S. competitors. We appreciate the role all of your agencies play in helping to strengthen U.S. commercial competitiveness and advance our national interests abroad. We look forward to your testimony, and I yield back. The Chairwoman. Unfortunately, we are called to vote, an important part of our responsibility, and I want to apologize in advance that I am going to have to stay on the floor because the supplemental will be coming to the floor. One of my colleagues will return and she will have the pleasure of hearing your testimony with my other colleagues. So I am going to adjourn. Mr. Rogers. Recess. The Chairwoman. Oh, recess. I am going to recess and--did you vote? Ms. Frankel. No. The Chairwoman. Some of our colleagues are on the floor now and are voting and coming back here. Thank you again in advance for appearing before us and I look forward to reading your testimony. Thank you. [Recess.] Ms. Lee [presiding]. OK. The hearing is called to order. Thank you very much for being here. I will be calling on members based on seniority of the members that were present when the hearing was called to order and I will alternate between majority and minority. Each member is asked to keep their questions within five minutes per round. Acting Director Chairman Reed, Boehler, we will be happy to place your full testimonies into the record. So if you would be kind enough to summarize your oral statement. I want to make sure that we leave enough time for everyone's questions. So we will begin with Acting Director Mr. Hardy and then Chairman Reed and finishing with CEO Boehler. Thank you. OPENING STATEMENT BY MR. HARDY Mr. Hardy. Vice Chair Lee, Ranking Member Rogers, members of the subcommittee, thank you very much for having me here today. It is my pleasure to be able to be here to talk about USTDA and its work around the world and the impact it is having both on our partners abroad and right here at home. As Chairwoman Lowey noted, the President's fiscal year 2021 budget proposes to eliminate funding for the U.S. Trade and Development Agency. As such, in today's testimony I want to focus on USTDA's statutory mission and what we are currently doing to advance our sustainable economic growth in our partner countries and how that is opening markets for U.S. goods and services in a dramatically changing and increasingly competitive international environment. As we all know, the American worker is the most productive, innovative, and dedicated the world has ever known. When given a fair opportunity, U.S. workers and U.S. companies compete and win anywhere. Too often, however, our products and workers are blocked by trade barriers that restrict market access or are disadvantaged by subsidized foreign competition that creates an unfair playing field. Congress created USTDA under the Jobs For Exports Act to, quote, ``promote United States private sector participation and development projects in developing and middle-income countries with special emphasis on economic sectors with significant U.S. export potential,'' closed quote. USTDA is, therefore, mandated to engage the private sector in infrastructure projects when technology options and project requirements are being defined. This early engagement ensures an honest and thorough evaluation of the impact on labor as well as the environment, and the financial sustainability of all activities USTDA supports to ensure they can be financed on commercial terms. To accomplish our mission, the agency provides grants to overseas project sponsors that contract with American firms to undertake these project preparation activities. This funding may support a feasibility study, launch a pilot project, or support an array of technical assistance. USTDA also connects project sponsors with U.S. businesses through its reverse trade missions that bring foreign decision- makers to the United States to see the design, manufacture, and operation of U.S. goods and services before a procurement decision is made. These activities produce results, as Chairwoman Lowey noted, for our foreign partners and U.S. industry. For every dollar USTDA invests in its project preparation activities, it is generating, on average, $111 in exports of U.S. manufactured goods and services. This success is made possible by USTDA's ability to make a small investment up front that paves the way for financing of major infrastructure from the likes of Export-Import Bank, the United States International Development Finance Corporation, multilateral development banks, and regional lenders. Last summer, I was fortunate to see firsthand the real- world impacts of this investment, namely the opening of a cancer treatment center in Lagos, Nigeria. This resulted from a USTDA-hosted reverse trade mission for Nigerian hospital officials that introduced those officials to American health care technologies. These hospital officials were from the Lagos State Teaching Hospital. As a result of USTDA's early and targeted investment, the Nigerian Sovereign Investment Authority financed the establishment of this world-class oncology center that is transforming cancer treatment in the most populous and largest country in Africa. As the President stated in his National Security Strategy, the United States must strengthen cooperation with allies on high-quality infrastructure. As a result, USTDA is utilizing its current appropriation and transfer funding from the Department of State to further open markets for U.S. companies and unlock infrastructure development opportunities. At the direction of the NSC, USTDA is working with Japan and other likeminded partners in new and unique ways to advance this quality infrastructure priority in line with the National Security Strategy. Critical to this effort is the administration's Indo-Pacific vision. Today, USTDA is utilizing its resources to advance this vision which is responsive to our partners' needs for quality infrastructure solutions in the energy, transportation, health care, and ICT sectors. This work is directly countering China's Belt and Road Initiative. As you all know, you have seen firsthand in your travelthat BRI poses serious economic and geopolitical challenges, not just for the United States but for our partners around the world. As a result, USTDA is deploying all of our tools to support sustainable economic growth in our partner countries that provides a quality option and helps our partners and allies avoid China's debt trap diplomacy. This investment is laying the foundation for strong and stable states in the Indo-Pacific region and around the world-- states capable of preventing conflict, states capable of managing crises, but perhaps most importantly, states capable of promoting prosperity. It is my pleasure and great privilege to lead the U.S. Trade and Development Agency and a staff that is dedicated to advancing and achieving these critically dual trade and development mandates. Thank you very much. I look forward to your questions. [The prepared statement of Mr. Hardy follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Ms. Lee. I go now to Chairman Reed. Thank you. OPENING STATEMENT BY MS. REED Ms. Reed. Vice Chair Lee, Ranking Member Rogers, Representatives Torres, Frankel, Meng, and other members of this subcommittee, thank you for inviting me to discuss the President's fiscal year 2021 budget request for the Export- Import Bank of the United States. EXIM was established in 1934 and it is an immense honor to be the first woman and the first West Virginian to lead this agency. Since being confirmed on a strong bipartisan basis 10 months ago, we have been hard at work to fully reopen, reform, and reauthorize EXIM to provide results for our nation's workers while protecting the U.S. taxpayer. Now that we are back in full operation, we are very focused on communicating to all of our stakeholders in the United States and around the world that EXIM is now able to offer all of its financing options to support U.S. exports. EXIM, the official export credit agency of the United States, has the important mission of supporting American jobs by facilitating U.S. exports. Our vision is Keeping America Strong, Empowering U.S. Businesses and Workers to Compete Globally. I love this mission and this vision as the U.S. worker is at the heart of everything we do. The President's budget for EXIM requests an administrative budget of $100.9 million which will enable the agency to effectively administer its operations and continue the transition to full capacity by focusing on leveling the playing field for U.S. exporters, supporting our nation's small businesses, and minimizing risk to American taxpayers. The request also proposes restoring EXIM's administratively determined pay authority which EXIM had up until 4 years ago to support the agency's efforts to attract and retain a talented EXIM workforce. AD pay is a very important tool to help us carry out our mission. When EXIM is fully operational, it is a self-financing agency because of the fees and interest it charges to the foreign buyers for the use of its programs. After paying its operating and program costs, EXIM has contributed a net of $9.4 billion to the U.S. Treasury since 1992. EXIM estimates that in fiscal year 2021 it will fully cover the costs of its administrative expenses, resulting in a net zero appropriation and, based on projections, we will remit an estimated $610 million to the U.S. Treasury at the end of the fiscal year. In fiscal year 2019, EXIM authorized $8.2 billion in financing that is estimated to support 30,000 American jobs. This was more than double the $3.3 billion in financing that EXIM authorized in 2018. We expect to build on that progress. In fiscal year 2021, EXIM forecasts that the requested budget will enable the agency to support $20.9 billion in new authorizations, supporting approximately 159,000 jobs in districts like yours across the country. EXIM has averaged a default rate of less than one-half of 1 percent over the past decade as a result of strong underwriting, effective risk management, and due diligence exercised during the authorization process and post- authorization management of transactions. We achieved a major success for our nation's businesses and workers when Congress passed and the President signed into law on December 20, 2019, a 7-year reauthorization of EXIM, the longest in EXIM's 86-year history. I am grateful for the strong support of our bipartisan leaders in Congress including members of this committee for this historic effort. This reauthorization provides important long-term certainty to the world so that American businesses of all sizes can compete and win in a very competitive global marketplace. We are beginning to implement the legislation and look forward to working with you as we continue to analyze the requirements and resource needs associated with full implementation of this landmark reauthorization. I briefly want to touch on some of the new congressional requirements included in EXIM's 2019 reauthorization. First, the law provides clear direction to EXIM to address the threat China poses to America's economic and national security. EXIM is working to establish a program to advance our country's comparative leadership in the world, directly neutralize competing Chinese exports subsidies, and support American innovation and employment in 10 transformational industries including wireless communications, 5G, biotechnology, and water sanitation, to name a few. Next, Congress has again called on EXIM to increase its financing to support small business exports as well as those related to renewable energy, energy efficiency, and energy storage. We are passionate about this work and taking steps to better reach and educate more businesses that could benefit from EXIM. I am excited to continue working with you and your staff in order to do great things on behalf of America's workers and help see more exports stamped with those four beautiful words ``Made in the U.S.A.'' Thank you for this opportunity and I am pleased to answer any questions. [The prepared statement of Ms. Reed follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Ms. Lee. Thank you very much. Now, CEO Boehler. Thank you. OPENING STATEMENT BY MR. BOEHLER Mr. Boehler. Vice Chairwoman Lee, Ranking Member Rogers, members of the subcommittee, thank you for the opportunity to speak today. The United States International Development Finance Corporation became operational on December 20th, 2019, propelled by bipartisan support in Congress and the support of the President. As a newly modernized agency, our mission is to invest with private sector partners to advance the interests of American people through development in emerging markets. Many of the nations that I visited over the past five months face economic uncertainty and poverty. Despite incredible challenges, these countries and their people hold enormous potential. I personally witnessed how unleashing the power of the private sector advances United States interests and transforms the lives of people throughout the world. I have also witnessed the great demand for a U.S. alternative from authoritarian governments. The BUILD Act enables the United States to be that alternative. DFC, with our private sector partners, are addressing the world's most critical development challenges by increasing access to water, closing the financing gap for women entrepreneurs, and building quality infrastructure. We are excited to take on this tremendous responsibility. A strong well-resourced DFC complements and amplifies the foreign assistance efforts of our partner agencies such as USAID, the Department of State, MCC, and my partners seated here next to me today. Together, we can foster sustainable economic growth and advance U.S. foreign policy interests. We work best when we work together. As we scale our operations to deliver on the BUILD Act's promises, the administration is requesting the resources necessary to make DFC's model of public-private partnerships an important tool of U.S. development and foreign policy. The total budget request is $836 million. The request consists of $136 million in administrative support including a new inspector general, chief development officer, chief risk officer, as well as $700 million for DFC programming. These request reflect DFC's increased portfolio cap from $30 billion to $60 billion that was authorized by the BUILD Act as well as the additional responsibilities requested by Congress. In addition to our legacy finance programs, the BUILD Act provides DFC with several new tools. Among the most important is equity authority. This greatly expands on our ability to deliver on the developmental and foreign policy goals that you have set forth. The BUILD Act also established new and important other priorities such as feasibility studies and technical assistance. When Congress established DFC it specifically included the word development in DFC's name to reinforce our core mission. The DFC is already making significant progress on our development mandate. We are creating a new state-of-the-art development scoring system called the Impact Quotient, or IQ score. We built this system with extensive input from the interagency and the broader development community. IQ will enable DFC to more accurately measure and monitor the development impact of every dollar that we invest. We are also expanding promising and proven programs such as the 2X Women's Initiative. The 2017 National Security Strategy identified women's critical role in achieving global peace and stability. DFC is proud to support this commitment through W- GDP, which seeks to economically empower 50 million women across the developing world by 2025. DFC is promoting economic opportunities for women around the world by expanding programs such as the Women's GDP 2X Initiative and we look forward to working with Congress as you seek to codify W-GDP. I am also pleased to announce that we hired our chief development officer, Andy Herscowitz, who is behind me over there. Some committee members may be familiar with him because he led Power Africa and I worked closely with Ambassador Green, and with Bonnie Glick to identify a candidate like Andy to take our development efforts forward. I will close by noting that I really appreciate the foresight of Congress in passing the BUILD Act. The strong support of Congress indicates that investment and development is not a partisan issue but an American priority. The U.S. International Development Finance Corporation, when combined together with our U.S. government partners, is an unparalleled tool for lifting people out of poverty and laying the groundwork for market-based economies across the world. Thank you, and I look forward to answering your questions. [The prepared statement of Mr. Boehler follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Ms. Lee. Thank you very much. OK. I have a couple questions for all three at this point. Each of your agencies I would like to get a response. First of all, all of you promote private sector engagement in different ways and so from your agencies' work what are some of the barriers for U.S. businesses to engage in abroad? And then sometimes there are business opportunities in areas where the private sector's capacity is limited due to governance issues, and so how do you handle that? Then the second question, of course, is around coronavirus in terms of how it has disrupted markets and caused upheaval in production and supply chains across multiple industries and sectors. So how does really a shock like this public health crisis affect your agencies' work and to date have you seen an impact on private sector engagement from your agencies' standpoint? And, if possible, are there plans to mitigate the impact? Should we be looking at something to support what those plans are? So we will start with Acting Director Hardy. Mr. Hardy. Thank you very much. I think the barriers that USTDA sees and the barriers that U.S. companies see are straightforward. They are China. We hear this from our partners around the globe and in the Western Hemisphere. Last week, Kim and I had breakfast with ambassadors from the ASEAN countries and our partner countries are looking for an alternative. They are looking for quality solutions that are built to last, that will provide long-term benefit to these countries, and China right now is investing--overwhelming what the U.S. is doing on a dollar for dollar basis. But what the U.S. provides is quality and long-term solutions and they are looking for that alternative and we hear that from our partners around the world, and that is what is driving the demand for us right now. I will say just this past week I had a really interesting conversation with a company, a manufacturer in Wisconsin who manufactures cranes and is retreating from the international market because they can't compete. China's state-run company is putting $100 million into local manufacturing of cranes in China and they can't compete on a dollar for dollar basis, and they are coming to us saying, what can you do--what can the U.S. government do to be responsive. And this company's tagline is integrity, commitment to stakeholders, and passion for excellence. And right now, we are pulling our interagency together to figure out a solution, how can we help change this paradigm not only with this one company but around the world. Ms. Lee. And on coronavirus? Mr. Hardy. Oh, on coronavirus---- Ms. Lee. How is it affecting your agencies? Mr. Hardy. I think at this point it is much more at a agency level. We have travel restrictions now that are going to limit our ability to do outreach to develop our program. We haven't seen a direct impact on the private sector as of yet. But I think that there will be definitely direct and short-term impacts as travel restrictions continue to increase. Ms. Lee. So are you all developing plans now, looking forward to this possibly happening to mitigate the impact or are you waiting? Mr. Hardy. We have put into place travel restrictions. Everything needs to be personally approved by senior management for any travel. We have, obviously, invested in the IT infrastructure that allows telecommunication whether it simply be Skype calls. Our partners around the world are--very frequently we use those in our normal course of business. So we are just trying to look at different ways to achieve our mission that don't require us to be on the ground as much. It will be difficult but it is something that we are prepared to implement. Ms. Lee. Chairman Reed? Ms. Reed. Thank you. Your question gets to the heart of what EXIM does and I am so thrilled that we are now fully reauthorized and giving the world certainty that we are around through 2026. When it comes to barriers in private sector capacity, EXIM comes in with those specific tools such as export credit insurance, working capital guarantees, direct loans or loan guarantees to help our businesses compete and some of those, when the private sector is able to compete and help our businesses win deals we can come in and guarantee the loans that the private sector offers. But as Director Hardy mentioned, EXIM was not fully open for about four years and when I became a nominee in 2017 there were about 90 some export credit agencies around the world. I even had one of them tell me to my face, we are glad you are closed because we get your jobs. And so when I finally was confirmed 10 months ago there are now 113 export credit agencies around the world, and China has two formal one informal one, and China does more than the G-7 countries combined. And so we are very honored to have a long-term reauthorization and also now are very focused on implementation of this new mandate that you have given us to compete with China and make sure that we are doing all we can to help our workers win deals around the world. Of course, we care about things like default and so we will be very prudent with the taxpayer dollar and review things with all the standards that we have. And I will tell you that the rest of the world has told us, we are glad you are back. The U.S. makes the best products in the world and we are very happy to have this tool to help us buy them. When it comes to coronavirus, we are actively watching. We come in when there are problems in our country for our workers and so that is why we have things like export credit insurance to help our businesses and we stand behind all of our products. We did the same after the 2008 financial crisis. Right now it is too early to predict. But we stand ready and we are monitoring closely. Ms. Lee. Are you planning any mitigation efforts based on impact or are you sort of---- Ms. Reed. If there are claims filed we will honor those claims to support our small businesses. So thank you. Ms. Lee. Thank you. CEO Boehler? Mr. Boehler. So to be additive, I am going to agree with what my partners said, to be additive. I would say sometimes it is access and familiarity with a particular market, particularly when you are talking about frail states or smaller markets. U.S. investors don't have a lot of deals to look at and so if you are talking about a small entrepreneur, let us say, in a small country in Africa, people won't necessarily have familiarity because they don't see a lot of deals. So if we can bridge and take some risk out of the equation for private businesses, it opens up an onramp. So I think sometimes familiarity and access is a limiter. But the second thing I will note as a limiter are structural barriers and let me use a specific example. In Ethiopia, there are certain structural barriers to investors putting dollars there. And so we are trying to address that even at the prime minister level to say, look, we would love to invest and so would other private capital; how can we help you with technical assistance? And we are working with Treasury on this to potentially adjust some of these things which would benefit Ethiopia so we could flood the market with private capital. So those are kind of things that often we would see out there. From a coronavirus perspective, I would say there are two areas where we are traveling--and onsite. One is, let us say, the sourcing of deals, meeting with governments, et cetera. And then the second one is we have pretty stringent requirements for when we do a deal to ensure that it doesn't violate our environmental standards, human capital standards, and a lot of times, if there is any question in those deals we go onsite to ensure that we are meeting the requirements set forth in BUILD Act. So what we are trying to do is, one, how much of that can you do over video, quite frankly, and maybe we change some practices and make lemonade out of lemons a little bit and say, OK, is that visit necessary. I just did a video conference with the Indonesians the other day and not everything has to be a physical visit. Some things do. So I think in addition to normal, protecting our workforce from a travel perspective we are really trying to push the envelope to see what can we really do without traveling, if that is the case, and maybe even learn something along the way out of it. Ms. Lee. And do you have any specific plans or are you kind of putting it together? Mr. Boehler. Yes. I mean, obviously, so the immediate thing that we did is we said listen, and just following best practice from the USG is only mission-critical travel, not to these so following CDC, et cetera. So that was an immediate, and now what we are developing is the specific. OK, what are, if you will, the work-arounds in lieu of travel which would be more, hey, when can we use teleconferencing in this. And I am having my team also look at for meeting the deal requirements what can we actually check off without being physically there. And there are some things that we will probably need to be physically there and that might delay a few things. But what do we need to meet to make sure we meet our statutory obligations. Ms. Lee. Thank you very much. I will turn now to our ranking member, Mr. Rogers. Mr. Rogers. Mr. Boehler, you were recently in Colombia I think a couple of times in the last few months. A natural ally of ours, our best partner in the region, and yet Colombia is suffering from various scourges, one of which affects us and that is the drug production. And now, with the trouble in Venezuela, 2,000 Venezuelans a day seeking asylum in Colombia, and it seems to me that--and I think you agree--the ultimate positive answer in Colombia is a strong local economy--small business, small manufacturing to absorb some of the refugees as well as supplant or undo the drug traffic. Do you agree with that? Mr. Boehler. I do, Ranking Member. And the way I think about it is Congress, in the BUILD Act, set three priorities for DFC: one, drive development worldwide, two, advance U.S. foreign policy and national interests, and three, protect taxpayer capital. Those are the three things I always focus on, and I think Colombia has the potential to be a best-case scenario in all because from a foreign policy perspective, as you mentioned, we have a domestic issue drug wise. They have an issue drug wise. And you mentioned the Venezuelan migrants, the million and a half people that are there crossing the border. Investment could alleviate that and should alleviate that, done well. But beyond that, where you are talking about investment in that case. The farmers that produce coca are in rural locations, that produce coca because they don't have a good economic alternative, because there aren't good roads to transport out coffee, cacao, palm oil. And so, to me, it could be a wonderful opportunity to achieve our mandate across development as well as advancing U.S. interests. Mr. Rogers. Are you having good relations with President Duque? Mr. Boehler. Yes. I have been quite a bit, and it was a pleasure to see him this past Tuesday at the meetings that he had in the United States. Mr. Rogers. Does he agree with you on this concept we are talking about? Mr. Boehler. He does. We spent a lot of time with the administration of Colombia. Obviously, something of this magnitude and making a difference has to be done in partnership. So, absolutely, Ranking Member. Mr. Rogers. More than 95 percent of the world's population is outside of the United States. Eighty percent of the world's purchasing power outside the U.S. So we are starting from scratch here. Those are pretty difficult odds to deal with. Your agencies have a role in trying to expand U.S. trade with our neighbors around the world. How can your agency--I am going to ask each of you--how can your agency play a significant part of expanding jobs in America with exports? Please keep it short. Mr. Boehler. Sure. I will make the comment that of every visit I have met out there with heads of state, the No. 1, top thing I heard repeatedly 100 percent is, we did not want to take investment from that autocratic country. We wanted a U.S. alternative and where were you? And they have a good point, and I think that between the three of us, as well as other government agencies, we are that answer. And I think that means a significant amount for the prosperity of U.S. businesses as we look at those markets, as we invest and create that alternative. People want American companies. People want American businesses. They know what we represent--quality, infrastructure, rule of law, transparency. And I feel very good about our prospects together. Ms. Reed. EXIM is dedicated tohelping our small businesses and now that we are reauthorized we have given the world certainty that we are going to be around through 2026. That is key to getting us where we need to go. I had a great experience in your district, sir, visiting a wonderful company called DecoArt Paints in Stanford and spending some time with CEO Stan Clifford. Because now we are good to go for a long tenure. We are able to come in and help the world say, hey, let us take a look at the United States again. It is a lot of work to get our small businesses up and running with exports and so we are partnering with organizations like the Independent Community Bankers Association and ABA and others, and also working with something called delegated authority so that our banks on the ground-- when you are a small business you go into your local bank--so they are equipped to help share some of those tools. And, of course, now that we are able to do those large transactions over $10 million, we got $40 billion in the pipeline when I showed up as the new chair and reopened EXIM, and so we are thoughtfully going through those applications. And we lost some of those applications. We lost, in fact, $20 billion worth while we were shut. So it is getting the word out. Working with each of you, coming and helping the world know that we are back and the world should pick us. Mr. Hardy. Thank you. Thank you, Chairman Rogers. USTDA is using its current funding as the tip of the spear to feed the pipelines of the financial entities--EXIM Bank, OPIC, the DFC--using a small amount of money, as I said in my testimony, to develop the infrastructure and the roadmap to encourage financing. And we have a history of success. I think that the three of us and our agencies work well together. As I looked and prepared for this testimony I reviewed a geothermal power plant that is currently operating in Honduras, financed by the DFC or the previously OPIC. Just last year, work we did directly with Senegal to help them expand transmission and distribution is in the pipeline for EXIM right now under the $500 million commitment. So USTDA's role is to develop those projects so they can get to financing and with that having USTDA's export mandate where we are bringing in U.S. technology, goods and services into the thinking and the process and the development of these projects is going to best position U.S. companies to succeed internationally. Mr. Rogers. I yield. Ms. Lee. Thank you very much. Now I will yield to Ms. Torres from California. Ms. Torres. Thank you, and thank you to all of you for being here. I do want to do a quick follow-up to the coronavirus issue. As you know, we are starting to see an increase here. The county of L.A. just declared it also an emergency. I have learned that the Commerce Department sent out a notice last week that highlighted a change to Chinese regulations which would make it easier for U.S. companies to export medical supplies, medical supplies that are in critical shortage here in the U.S. such as masks that--I have a family of three nurses. They can't get masks while they are working front lines in the hospital. I went to five different stores over the weekend trying to find hand sanitizer. It is all completely out. So my question is the EXIM Bank consulted with the U.S. Coronavirus Task Force to ensure that we are not supporting the exportation of critically limited supplies that our first responders need in order to protect our communities? Ms. Reed. Thank you. We take the coronavirus very seriously. EXIM comes in with those very important tools to help our exporters be successful and we have supported in the past medical equipment and---- Ms. Torres. I am sorry. Just a quick yes or no. Ms. Reed. Yes. Ms. Torres. The Commerce Department and EXIM coordinate to make sure that we are not drawing down on supplies that are not available to U.S. citizens in the homeland. Ms. Reed. So I have communicated with all key parts of our administration that we stand ready to be helpful in any way. Again, we need to have applications come in to us and we will promptly review any application to help our exporters get medical equipment to China or other places around the world. Ms. Torres. China is important but, you know, the most important--for us, the priority should be to ensure that we have these medical supplies here at home, available to first responders and to American citizens before we begin to export them out, right? Ms. Reed. Our mission, though, is a very specific mission to support the export of -- Ms. Torres. But our mission--we cannot cut our nose in spite, you know, of our face. We have to protect our health needs in the U.S. So the left hand has to communicate with the right hand and we can't say our priority is to, you know, allow folks to pay $150 for a tiny bottle of hand sanitizer because it isn't available anywhere here in the U.S. Meanwhile, you are working to send these critically needed supplies to China. Ms. Reed. I would be pleased to work with you take a really hard look at our legislation and anything we can do to help support our country. Ms. Torres. I am just saying common sense--let us look at it and please work with the current working group that the President has set up to ensure that they have all of the supplies that they need before we start exporting them out. In this case, exports are no bueno. In relationship to the Northern Triangle of Central America, I am very concerned that we have not paid attention to major concerns and issues of public corruption. Every businessperson that I talk to that is trying to do business in the region, their number-one concern is having to pay off local governments and corrupt elected officials in the region in order to do business. So incentivizing by providing--the DFC signed an MOU with Guatemala to catalyze $1 billion in private sector investment. Mr. Boehler, what does catalyzing $1 billion in private sector investment mean and are we exposing our business community to huge losses, potential huge losses, because they are investing in Honduras, a narco government, in Guatemala, an extremely corrupt government. Mr. Boehler. Congresswoman, I want to note I agree with you on this and I think something like a memorandum of understanding, if used correctly, establishes kind of a framework to say this is the potential. This is the potential if you start really clamping down on corruption. I went to the inauguration of the Guatemalan President Giammattei and, you know, he spoke extremely well about it. But action has to follow words. Ms. Torres. And his actions have been, you know, to punish NGOs who are trying to promote rule of law and good democracy standards. Mr. Boehler. Yes. Ms. Torres. So we cannot incentivize these corrupt officials to continue with their corrupt ways that are causing all of the mass exodus in those countries, leaving families, babies, at our southern border seeking assistance. We have to provide the political support to the region and we cannot do that by incentivizing American dollars to corrupt or narco traffickers in the region, even if the narco traffickers are the President and his entire family. Mr. Boehler. Look, I 100 percent agree. I mean, this MOU is not a commitment and these things are not conditionless or blank checks. So I agree with you. Ms. Torres. The BUILD Act--I had an amendment and my amendment specifically says that assessments prior to providing funding must occur and must be based on these policies and procedures. The law requires DFC to have these policies and procedures in place, and I hope that you have policies already and that you can follow up. My time is up so I can't continue to take time from the panel. But I hope that you can follow up with my office. Mr. Boehler. We will. Ms. Torres. And that we can get a briefing exactly on what this MOU is because it is not--there is nothing transparent about this MOU. And I yield back. Ms. Lee. Thank you. Ms. Frankel. Ms. Frankel. First off, thank you all for being here. I appreciate your efforts. Let me start by saying thank you for mentioning the women's economic initiatives and which I support. I am going to have some questions to that but I just want to say something for the record, which is nothing personal against you all. But I agree with this initiative to empower women economically all over the world. But I am just--I just want to say for the record it is contrary to this effort for the Trump administration to come in here in another forum and ask for cuts in girls' education and women's health care, specifically access to reproductive care. So with that said, I will get to some questions for you. So the BUILD Act, we said that for DFC to prioritize the reduction of gender gaps and maximize development impact by working to improve women's economic opportunities throughout the DFC's portfolio. There was another provision in the BUILD Act that calls for gender-segregated data. So I would like you to, if you could, comment on each of those areas on how you are moving forward. And then one other question I have in this regard is the OPIC staff had been looking into EDGE certification, a global certification standing for gender equality, and I am wondering whether or not you are continuing to explore that. So those three questions, if you could respond. Mr. Boehler. Sure. And I am sorry. Could you repeat the first one again? Ms. Frankel. OK. The first one, the BUILD Act requires the prioritization--I will read it specifically--to prioritize the reduction of gender gaps and maximize development impact by working to improve women's economic opportunities. Mr. Boehler. Yes. And so on the first one, obviously, 2X and our collaboration with W-GDP has been a huge focus. We set up a goal initially in the first year of a billion dollars of investment. We exceeded that. I think we were $1.3 billion, $1.4 billion. We then set up -- Ms. Frankel. Where are you investing? How are you investing? Mr. Boehler. Yes. All over the place. I mean, let me give you a specific example. When I was in India last week I visited one of our investments called Satara, which is focused on affordable housing for women. We are backing up mortgages for women that are working mothers and so got to see this right in place. You have got a number of different initiatives focused on rural communities. One of the things I find with women in emerging economies and rural is that it is very difficult for them to leave and work. And so some of the technology initiatives we are looking at, for example, coding, if there is internet access, can be a really effective way to improve employment on the women's side. But our position has been, you know, how can you be a successful country if you haven't empowered half of your workforce. And so that is something that we have pushed very hard. Your second question, I think, really relates to our monitoring and reporting back, and you will see that as per the BUILD Act. We see those requirements. That is what we are building toward. And then your third question around EDGE certification, we did get EDGE certification and I actually was looking at the numbers a couple days ago. Not only we got it last year, but our focus on the women's and minorities' side has resulted in much higher increase actually in the amount of women. One thing that I noticed when I came on board is that we were over 50 percent women, but at the very senior level, that was not the case. Our management team has greatly expanded toward women even since the year of our EDGE certification. So I think we are very much moving in the right direction and we have an increased commitment there. Ms. Frankel. I think maybe you answered. The question is whether you are going to actively work to identify partners who prioritize gender equality. Yes. Mr. Boehler. Yes. It is one of the considerations, actually, we look at. In our evaluation of deals there is a 2X focus, and when we do our IQ score being women-focused increases your development score, which would greatly enhance our probability of funding the deal. Ms. Frankel. OK. I want to thank you and I thank you for your commitment to that. And not to be sarcastic or rude, I just want to say, as I conclude my remarks, that the women we are getting mortgages for they need access to contraception. And I yield back. Ms. Lee. Thank you very much, Ms. Frankel. Now I will turn to Ms. Meng. Ms. Meng. Thank you, Madam Chairwoman. Ms. Frankel asked most of my concerns and my first question was about women's empowerment, too, especially women's access to credit. Just wanting to make sure and if you have any insight on how we are making sure that, especially with the 2X initiative, that women's access to credit will be institutionalized, made permanent, dependent, regardless of who is in charge. So that is my first question and I will just go to my second question on a totally different subject, but climate. Climate change poses great risks to the ability of many low and lower-middle income countries to fulfill development goals. One, although the Trump administration has announced that the U.S. will leave the Paris Climate Agreement, to what extent will the DFC help countries implement their nationally determined commitments to international conventions? And, two, in 2017, despite having strengthened its environmental and social policies, OPIC financed four oil and gas projects, which, collectively, represented over 2.3 million tons of CO2 per year in emissions or a 14 percent increase in annual emissions in these countries. Will the DFC continue to finance projects that rely on fossil fuels? Mr. Boehler. So on the first question, I spoke about it a little bit. The other thing I will just note on the side is the visibility that Ivanka Trump has given the 2X Initiative I think actually has mattered a lot. Because I know at the head of state level when we meet with countries, they will very much highlight their Women's Initiative. And so that focus has made it a constant thought process and I think that other countries know that as they look to ally with the United States this is an important consideration that we look at. And I think it has started to become really institutionalized. So, one, I think that is really positive and I think women's access to credit and financing, limits on those are not acceptable and really hinder. So a lot of our focus on investing has been how do you get out and remove those barriers from a financing perspective. So yes. Ms. Meng. Right. Yes. Those are all positive and just wanting to make sure, like, in a potential--in a future administration that the priorities would be the same even if the administration was---- Mr. Boehler. Yes. I think the nice thing--it feels like this focus on women is becoming institutionalized, and so I think that is really nice. I think, especially as Congress thinks about codifying W- GDP, the 2X brand, et cetera, it feels like it is settling in. And, if you will,--it feels very American and continuing, and not a partisan issue, which is really nice. Ms. Meng. Thank you. Mr. Boehler. Your second question around the 2017 deals, obviously, I wasn't there in 2017 but I will tell you what I am focused on, which is renewable energy. Over 80 percent of our deals are in that space and anything that is not renewable, based on the guidelines, that BUILD Act that Congress gave us, the bar is high. It is very high. It is looked at with increased scrutiny if it is not in that category. So that is my general commitment. I will tell you, I would much rather do a deal renewable than not, and so it will face a higher bar based on the statutory requirements that we have in BUILD Act. Ms. Meng. Thank you. I yield back. Ms. Lee. OK. Thank you very much. Let me ask a couple of questions of all of you in terms of--my first question has to do with the utilization of minority-owned businesses. As I travel throughout the world, I am always looking to see what partnerships and what contracts where there are business arrangements with U.S. firms. I never see African- American companies, I never see Hispanic companies, and I never see Asian Pacific-American companies. How do you all--first of all, when you do business with American companies as partners in any of your programs, how do you address this? And I would like to also ask if we could get a report back with regard to the utilization, the partnerships, the arrangements you have with minority-owned businesses disaggregated by African American, Asian Pacific-American, and Hispanic businesses. Mr. Hardy. Mr. Hardy. Thank you. I think I will start at the big macro level, which is the small business, and then get down to the micro level. USTDA is proud that we have over 60 percent of our FAR contracts are committed to small business, and when we drive down deeper a significant portion of those are dedicated or in the 8(a) program that oftentimes are designed for a minority-owned business, Hispanic-owned businesses. We can give you a clear breakout, but a significant amount of our FAR contracts are set aside for that 8(a) program and our overall number is over 60 percent of all contracts at USTDA funds under the FAR is small business. Ms. Lee. OK. I would like to see that breakout. I am a former 8(a) contractor myself and it was very difficult as an African-American woman to break in. And so I would like to see, again, the data disaggregated based on the good work that you are doing in terms of the U.S. Trade and Development Agency. Mr. Hardy. We would be happy to, and we have--the 8(a) program has been very successful for us to get companies, small companies, that have--and as you know as an 8(a)--former 8(a)-- having that mentorship that that 8(a) program provides to small business has been very helpful for us to get not only smaller business started but help them get the capacity to expand longer term. Ms. Lee. OK. Thank you very much. Ms. Reed. I am really taking this program that we have at EXIM called Women and Minority-Owned Businesses to the next level. I love it and I believe in it. We have got a great staff and we know that it takes a lot of dedicated staff time to ensure that we are reaching out, especially as Director Hardy mentioned with our small businesses. So in fiscal year 2019, we did $441 million in authorizations for women- and minority-owned businesses and we are going to increase our staff that focus on that at EXIM over the next few months. We are going to go from 11 to 13 of our staff. And I want to just touch on some of the groups. You asked us to identify who our partners are and so I have partnered with the Minority Business Development Agency, the National Minority Supplier Development Council, Women's Business Enterprise National Council, the U.S. Hispanic Chamber, and the National Veterans Business Council. But really look forward to doing more outreach, coming with you and doing that, and as one of the 100 women leaders in STEM I know that we need to do all we can at all levels, in the private sector as well as in government. So I am pleased to say that of our 373-person workforce at EXIM, 40 percent--46 percent identify as nonwhite and 53 percent of our workforce is female. Ms. Lee. Thank you very much, and I would like to get a report back, though, with, again, disaggregated--African- American, Hispanic, Asian Pacific-American. Ms. Reed. With those numbers. Ms. Lee. Thank you very much. Mr. Boehler. Vice Chairwoman, got you on the report. I will be happy to do it. I think two things, to be additive. One is I think when we invest in countries in the United States, we have great Diaspora populations. I mentioned Ethiopia before. You have a great Diaspora population in Virginia, really close. A Caribbean population in the United States. On the Western Hemisphere, a Latin American population in the United States, which I think you have people that have moved from those countries, which could be great opportunities and I think that will be phenomenal. The second thing is Kim and I share different reasons--Kim being newly reauthorized, my agency being newly created-- probably some opportunity to go out and to let U.S. businesses know who we are. So I think it is probably helpful and we could do a tour together but happy to do it together with Members in districts to advertise this, too, because we can always do better and we are new. So I think that would be helpful. Ms. Lee. Thank you very much. And, again, whatever data you have I would like that back. Mr. Boehler. Understood. Yes. Ms. Lee. But I would also suggest that you look at the Tri- Caucus, the Black, Hispanic, and Asian Pacific-American Caucus, as you move out to raise awareness about this. Mr. Boehler. Yes. To do that. Ms. Lee. Mr. Hardy, let me ask you about your agency. Now, the Access to Africa Initiative, that has helped facilitate transactions that build sub-Saharan Africa's infrastructure using American goods and services. And as we know, in the President's budget it zeroes out TDA operations. So if TDA operations cease, what do you anticipate will happen, first of all, to ongoing projects in sub-Saharan Africa, but secondly, and again, as I move through the continent of Africa quite a bit every year I understand the investments that China is making. I see this each and every day, and if in fact we want to be competitive and want to have a larger footprint there for all of the reasons you stated, why in the world would we zero out operations that would help U.S. companies and help ongoing projects in Africa? Mr. Hardy. Let me start with the ongoing projects. We have worked closely internally within the agency and OMB to manage how we would draw down the agency, draw down staffing, and the long-term projects. Because you are right, those do take a long time to--for our investments to come forward to financing, and that would include potentially having to move some of our authorizations and commitments to another government agency in the out years if, in fact, that Congress and the administration move forward with closing USTDA. What would it mean if USTDA was eliminated? I think that we would--there would be a hole. But U.S. companies would be able to step into that hole. It would be--it is a challenge, as I talked about in my testimony, and there is a very competitive market. You have players that are not playing by the rules and companies are suffering. U.S. companies are suffering greatly. Companies in your district, companies around the country. And there would be a hole if we weren't there but it would be a hole that the budget request says that U.S. companies could step into. Ms. Lee. I think it would be a deeper hole just in terms of the geopolitical dynamics that this message would send in terms of the U.S. versus China. I mean, I think that this is something I hope this committee will look at and address. Let me ask you, Mr. Boehler, the relationship between the African Development Bank--I think it was $54 million request for the first aid installments--and the Millennial Challenge Corporation, I think it is $800 million. It is down from $905 million in the past 2 years. What does the relationship between the African Development Bank and the MCC look like? I have visited the African Development Bank a few times and I think it is doing quite an amazing job with minimal resources. And so I am trying to understand what is taking place now in terms of the partnerships and this reduction in funding. Mr. Boehler. First, so Vice Chairwoman, I am not 100 percent sure related to MCC and the African Development Bank. I know that we have looked to partner with them at DFC, so we established kind of a memorandum of understanding to look at joint projects in Africa together. I met Dr. Agustina a number of times and really, I think they are aligned in our view and I always like partnering with local partners. But I couldn't comment--I wouldn't want to comment in detail on MCC and that area because I am not---- Ms. Lee. Well, maybe there isn't a relationship between--I mean, you know, there are so many different agencies. Mr. Boehler. Yes. Ms. Lee. And I am trying to see how the coordination and collaborations take place specifically on the continent of Africa since it is such a neglected continent. Mr. Boehler. What I could reflect on, if it is helpful, Vice Chairwoman, is how we work with MCC with it in Africa or-- would that be helpful? Ms. Lee. Yes, that would be helpful and also just in terms of your background. Mr. Boehler. Yes. Ms. Lee. You know, in business it is a very difficult region in Africa. Mr. Boehler. Yes. Ms. Lee. And so some countries in Africa receive the private investments. Others receive little or none. Mr. Boehler. Right. Ms. Lee. And so I am glad you are there. But it is a challenge. Mr. Boehler. Yes. Ms. Lee. And so I am going to try to stay on top of this with all these agencies because I think we have a window of opportunity now. We are losing that window very quickly. Mr. Boehler. Yes. And you correctly identified, Chairwoman, around China and the issue there, which is, as you know, very real. So I will reflect a little bit on MCC and then what we are trying to do not only in bigger countries that are known, like South Africa, but other countries that are not as developed. Within MCC, when MCC enters into a compact, it can take a while. There are a lot of requirements. And so one way that Sean, who runs MCC, and I have looked at working together is beforehand investing to help countries reach that threshold potential so that they could enter a compact, because there is a lot that can happen before that. And then even once they enter a compact, because his money is grant money, how could we surround and work together. And, again, I think we are best when we work together and I know that we have meetings, actually us, with MCC all the time around, now we are looking at this--how could we have EXIM come in and how could we do technical assistance before they get to that threshold. So I think it is a really good way we can work together and I think you are right, our timing is good because we are finally operational and there is a lot of focus on it, given development in China. And then the only other thing I will note is I very much view our focus at, because we are a development agency first and foremost, is to enter into fragile states and developing states and not just where it is easiest. And so that will continue to be our clear mandate because that is what has been given to me by Congress and I will follow that mandate. Ms. Lee. Great. And my final--did you have something? Mr. Hardy. Thank you. If I could just follow up on Africa. I want to assure you that Africa is not the neglected region. I have spent over 20 years working in Africa and have seen success after success after success of USTDA making that early investment and how it has transformed people's lives. Whether it be a digital inclusion in the townships outside of Cape Town, the deployment of what is now a subsea--undersea fiber optic cable that is bringing broadband access from the southern tip of South Africa all the way up to Egypt and the transformative impact that that is having. And just this past year at the CCA conference we launched an initiative called Access Africa that is designed to take those successes and expand our investment in ICT infrastructure to ensure that the IT infrastructure is best being able to help Africans across the continent. Ms. Lee. Yes, Chairman Reed? Ms. Reed. Thank you. Vice Chairwoman, I just want to underscore how committed EXIM also is to sub-Saharan Africa. Congress has asked us to prioritize sub-Saharan Africa, and back in September we stood up a Sub-Saharan Africa Advisory Committee. They sent a report to Congress with some wonderful recommendations. My fellow board member, Judith Pryor, I have asked her to take on that as one of our key objectives. And just so you know, we have reopened EXIM. We approved the largest deal in the history of EXIM last year and that was to the country of Mozambique, a $5 billion deal that will transform the country. And because EXIM was reopened, originally China and Russia were in the deal and they got kicked out because the Mozambique government and those in Mozambique wanted to buy our U.S. goods and services. So that is going to support 16,400 jobs across the country and we are working really hard. I don't know if you know Florie Liser, who heads the Corporate Council on Africa, but she is on our advisory committee and I am going with her to Africa in a couple months. As soon as I was sworn in, President Trump asked me to lead his delegation to the swearing in of Cyril Ramaphosa in Pretoria, South Africa, and it was such an honor to be there and sit down with all of the potential business leaders--actual business leaders--but for our potential business deals that could happen now with Africa. So we have done preliminary commitments in Cameroon and Senegal to help some small businesses be successful there and I really hope that we get to celebrate something from your district to Africa as well. So we will work hard on that. Ms. Lee. Thank you very much. OK. Mr. Boehler, on thinking out of the box and really coming up with new ideas, this new form of financing--hybrid financing--it is intended to be like equity but treated like a loan under the Federal Credit Reform Act, is it equity? Is it not equity? Is it another form of--seems like it is another form of debt financing, which OPIC has been doing for some time. Can you kind of drill down just a little bit on that? Mr. Boehler. Yes. I think when you think about the difference between debt and equity, there is a whole spectrum of different products within there, and so kind of some of the concept here is, and really, ultimately, what is the difference between that debt and equity because they can look like each other. A lot of times, it is where you sit in the stack where first money comes out, your governance rights is common, and whether there is redemption. Those tend to be the three differences. And so as you move towards senior lending you move up the stack, mezzanine lending, more senior loans. And so the idea is really to be off--to be able to offer a spectrum of different products that fit the right situation. There are times, for example, when the senior lending stack--if you will, the mezzanine stack--that is a riskier layer. So you won't find theprivate market willing to do that. But they would take a certain stack. There are times where equity is really appropriate. I will give you an example. If you are a small entrepreneur in Africa, like we are talking about, saddling that entrepreneur with debt, probably be counter to what we would want to do in terms of--to your point, out of the box, is really to have a spectrum of products so that you can use the right thing for the right situation. Ms. Lee. OK. Well, you have a development mandate, though, right? Mr. Boehler. Absolutely. Ms. Lee. So this is more associated with more of a business model. Mr. Boehler. What I would say on this is, to me, it is not business model. Again, it is using the right product for the right situation. So by way of example, if you are using a riskier debt product that a private market won't take, you are enabling the private market to do deals to drive development. This equity example, you are enabling entrepreneurs that you wouldn't want to saddle with debt. So when I think about our financial products, we are always using them to drive a development purpose. That is our mission. Ms. Lee. So are you testing it or are you using it without, say, modeling it? Mr. Boehler. There is nothing we won't enter into that is not heavily modeled and then evaluated not only by our internal credit process, which is an independent credit process, all the way through, but then over by OMB as well. So everything we do, it is always a refined, specific process that is career led from that perspective, too. Because I think it is critical that we have an independent view from a credit perspective and then it goes over to OMB and, you know, they have sharpened pencils there. Ms. Lee. Well, keep us posted on how this is going. I am very interested in this. Mr. Boehler. Yes. Ms. Lee. Making sure that it is going to do what it is supposed to do. Mr. Boehler. That makes sense. Ms. Lee. OK. Thank you very much. Let me thank the panel for your time. It has been very informative and interesting, and glad to see you here. And any reports or any requests that members made we look forward to receiving those in a, hopefully, expedited fashion. So this concludes today's hearing. The Subcommittee on State, Foreign Operations, and Related Programs stands adjourned. Thank you again. [Material submitted for inclusion in the record follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] Wednesday, March 11, 2020 DEPARTMENT OF THE TREASURY WITNESS HON. STEVEN MNUCHIN, SECRETARY, DEPARTMENT OF THE TREASURY OPENING STATEMENT BY CHAIRWOMAN LOWEY The Chairwoman. The Subcommittee on State, Foreign Operations, and Related Programs will come to order. Secretary Mnuchin, thank you so much for joining us today. The administration's fiscal year 2021 budget request, which proposes unsustainable cuts of nearly 20 percent for foreign assistance, demonstrates once again that the administration just does not value the impact of the global economy on our national security, nor does it recognize the merits of poverty reduction through multilateral development. Fortunately, this committee does. The Treasury Department's international programs are central to achieving strategic objectives overseas, and investing in these areas and our multilateral partners builds resilience and promotes stability that is essential to American interests. The administration's repeated attempts to end cooperation with multilateral organizations threaten our economic and national security and weaken our global influence and credibility. This creates opportunities for other countries, such as Russia and China, to further encroach into areas where we have chosen to diminish our leadership on the world stage. As they continue to expand their reach, they will not represent American values or interests. With the effects of climate change increasing, I am worried about the message we send to the rest of the world by reneging on prior commitments, such as cutting in half the U.S. pledge for the Global Environment Facility, providing less than half of the $3 billion pledge to the Green Climate Fund, and withdrawing from the Paris agreement. This is of particular concern, given the administration has touted that tree planting--although it is a good idea--but that tree planting will solve our climate crisis. Given that climate change will impact almost every program funded by this bill, I, frankly, don't understand why the administration refuses to stand behind commitments or make investments that could harness the power of U.S. businesses to innovatively address this challenge. Further, by neglecting to contribute to the Global Agriculture and Food Security Program and the International Fund for Agricultural Development, this administration signals a fundamental lack of understanding about the importance of risk mitigation and preparedness. Just as the novel coronavirus has disrupted markets, shocks like droughts, floods, or invasive pests can wipe out crops and contribute to food price spikes that quickly create conditions for instability, violence, and migration. While we don't always know when these events will occur, we know there is an increasing likelihood they will become more frequent and severe due to climate change. When communities are prepared to mitigate the impact of such events, they are better able to prevent lasting effects that are costly and threaten our own security. Diligence and leadership matter. We must demonstrate that the U.S. is a strong, reliable partner, just as we must stand unwaveringly behind our commitment to promoting democratic values. I am concerned about the Treasury Department's engagement in U.S. efforts to combat terrorist financing networks and enforce sanctions against rogue nations. While sanctions can be a valuable tool to mobilize governments to cease human rights violations and take democracy and rules more seriously, the administration's approach is neither consistent nor effective. Not one of the dangers I have just outlined is positively addressed by your budget request. As chairwoman, I have every expectation that we will produce a bill that maximizes each taxpayer dollar while maintaining responsible investment with our multilateral partners. Again, I welcome you here, and before we move to your testimony, let me turn to Mr. Rogers, the ranking member, for his opening statement. OPENING STATEMENT BY RANKING MEMBER ROGERS Mr. Rogers. Thank you, Madam Chair. And Secretary Mnuchin, welcome to our subcommittee. We appreciate you being here and look forward to your presentation on Treasury's fiscal 2021 international programs request. Your Department is seeking $1.59 billion in the coming fiscal year for international programs. That is about 8 percent less than the fiscal year 2020 enacted level. Key elements of the funding request would go towards meeting the annual U.S. commitments to the international financial institutions, debt restructuring, and Treasury's Office of Technical Assistance. The decrease from the enacted level apparently is primarily due to a negotiated reduction in the pledge to the International Development Association of the World Bank Group. This outcome is part of a larger package of reforms that the U.S. has advanced at the World Bank, and I look forward to hearing how those initiatives more closely align the World Bank with U.S. national security, foreign policy, and economic priorities. In addition to such reforms, I hope you will address with us this morning your role in providing the highest level of oversight to these institutions. I will get into more specifics during our question and answer period. Mr. Secretary, another topic that we would like to hear about, of course, is China. As you know, our Government has identified the renewal of great power competition as a defining feature of the 21st century. With respect to China, the United States has developed a whole of government approach to respond to Beijing's expanding global reach. For the Department of Treasury, this response must include countering China's authoritarian development with a more transparent and market-oriented model. I hope you will address this on the elements of a comprehensive U.S. economic strategy toward China that offers a meaningful alternative to Beijing's predatory trade and infrastructure financing. Finally, I would be remiss if I didn't raise the issue of the day, the spread of COVID-19 from China to much of the rest of the world and its impact on the global economy. I hope you will speak to the ways in which the administration and Treasury are helping to mitigate the economic impact of this disease, both domestically and internationally. We appreciate your service to your country, and look forward to your testimony. I yield back. The Chairwoman. Thank you. I will be calling on members based on seniority of the members that were present when the hearing was called to order. I will alternate between majority and minority. Each member is asked to keep their questions to within 5 minutes per round. Secretary Mnuchin, we will be happy to place your full testimony into the record. I know you have a hard stop of 12:00, noon. So if you would be kind enough to summarize your oral statement, I want to make sure we leave enough time to get to everyone's questions. But, Secretary Mnuchin, please proceed as you desire. Thank you. OPENING STATEMENT BY SECRETARY MNUCHIN Secretary Mnuchin. Thank you. I will be very brief. But first of all, thank you, Chairman Lowey, and thank you, Ranking Member Rogers and the members of the subcommittee. I am pleased to be here with you today. I first just want to emphasize the administration, through the White House task force, is doing everything possible to address the risks associated with the virus. And while public health is our highest priority, I assure you that we are also working on economic programs to support hard-working Americans and businesses that are affected by the disruptions associated with the spread of the virus. We are also coordinating with international organizations and our counterparts. The 2021 budget makes clear that we prioritize some very important issues. We have $1.6 billion for international programs. I would just highlight approximately $1.5 billion for the MDBs, as well as $33 million for OTA and $78 million in relief for the heavily indebted poor countries. I also just want to apologize in advance. I normally wouldn't do this, but I may look at my cell phone a couple of times during the meeting, given everything that is going on. And Chairwoman Lowey, I also want to recognize and thank you for the previous work we were able to do together on the bipartisan spending bill, and I look forward to Congress working together to address these very important issues associated with the virus on a timely basis. [The prepared statement of Secretary Mnuchin follows:] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] The Chairwoman. Well, thank you very much, Mr. Secretary, and I know that our work together with the Speaker was really invaluable. And you offered such important contributions to the effort. So welcome today. The 10-year Treasury yield fell to a record low due to fears about the novel coronavirus. There are concerns of its impact on economic growth. I think that is the understatement of this hearing. Mr. Secretary, how will this affect the economy at home and abroad, and are you coordinating with the State Department and USAID on how global economic upheaval due to the novel coronavirus could impact underdeveloped nations? Is there a way to mitigate the impact on U.S. business interests abroad? And by the way, I realize that you are right in the middle. So all these questions I am sure are on your agenda, and if you could share with us some of your thoughts, both here and abroad, we would be appreciative. Secretary Mnuchin. Well, let me just comment that the situation is obviously moving very quickly and rapidly. So we are literally meeting every single day, 7 days a week, on this on the task force. Steve Biegun from the State Department, the Deputy Secretary, is on the task force. I actually was meeting with Secretary Pompeo this morning, and we updated each other on the issues directly as well. So State and Treasury are very much coordinated. We have a large team at Treasury, both consisting of international and domestic people, looking at these issues. We are coordinating on an international basis. We are the host of the G-7. So we have been hosting both G-7 calls. We have been having bilateral calls. We have had conversations with the IMF and the World Bank. We are also on a domestic basis in touch with all the regulators. I hosted a call yesterday of the President's working group, which included all the major regulators. So I assure you we are not only focused on the health issues, but the economic issues and coordinating across the board on these. The Chairwoman. Secretary Mnuchin, I just can't resist saying at the outset of this hearing that I appreciate your involvement. I know that you, the Speaker, and I work closely on many issues as they come forward. I appreciate you being here today. You should know, as a member of the President's Cabinet, that Secretary Pompeo doesn't feel he has any responsibility to come before this committee and other committees just to keep us abreast of what he is doing. So just thought I would let you know, as a member of the Cabinet. And again, we appreciate you being here today. Climate change. It is a threat to every investment made by this bill from natural resources to food security and global health to peace building. Yet this administration has systematically withdrawn from activities to address climate change. Businesses here and abroad have experienced the negative impacts caused by rising seas, erratic weather patterns, lost productivity, and it makes it much more critical to uphold and strengthen our multilateral partnerships. The administration has justified cutting the United States pledge for the Global Environment Facility in half, suggesting that doing so will incentivize burden-sharing among other donors. Mr. Secretary, given our lack of participation on climate change, do our multilateral partners believe we are even serious about tackling this problem? Secretary Mnuchin. Well, let me first say that the President very much cares about the environment and, specifically, clean air and clean water, and we are doing everything, both domestically and internationally, from a technology standpoint and a policy standpoint to focus on clean air and clean water. I would just also comment, and I don't want to minimize the issue of climate change, but I was at Davos last month where the only thing people wanted to talk about was climate change. And it was a month ago I was emphasizing to people there are other very important issues, such as the health issues. I think people underestimated globally the impact of this when China was quarantining 12 million people. So I want to emphasize that we look at the environmental issues broadly, and this is one of the important international issues, but not the only important international issue. The Chairwoman. I appreciate that, and I would be interested to know has the administration's approach to really beat up on other countries to do more, has he been successful in getting others to step up? Secretary Mnuchin. Well, I wouldn't use the word ``beat up.'' I would use the word ``encourage.'' And yes, the President believes in burden-sharing. So whether it is other countries paying their fair share of NATO, or it is other countries paying their fair share for international organizations or doing what they need to do, we have had specific conversations with both China and India as a result of environmental issues there, and the President is very focused on that. The Chairwoman. Has their increased participation made up the gap from our retreated efforts? Because I understood that, when you were saying he was trying to encourage greater participation, which is a good thing. But has the gap been made up? Secretary Mnuchin. I think in most cases, it has. But I would also just emphasize, it is not just the contributions of money. It is the policies. So the United States is the most advanced on clean energy. I think as you look at, you know, what we are doing on tax credits for carbon recapture and other ideas, I mean, technology is moving quickly. And we are looking at technology for efficient and clean energy. The Chairwoman. Thank you. Mr. Rogers. Mr. Rogers. Mr. Secretary, let me ask you briefly about the economic impact. Obviously, we are experiencing some heavy interference in the normal business activities because of the virus. Should we be getting more help from international financial institutions like the World Bank, and should we not expect more out of them? Secretary Mnuchin. Well, let me just comment that, again, I think, as you look at, there is no question that as a result of the virus, in many parts of industry, the economic actions are actually well in advance of what might be the health issues at this time. And there is no question as it relates to both domestic and international travel, it is down considerably. On an international basis, both the IMF and World Bank have committed significant resources. The IMF has made a commitment to $50 billion of loans, and again, let me just say these are loans, not grants. So we are pleased with that. And the World Bank has announced about $12 billion, I think, which is split with about $6 billion of loans and $6 billion of grants. So I think it is important both these institutions, we have had conversations with the leadership, both bilaterally again, as well as the leadership calls that they have hosted. So we are working with them closely. Mr. Rogers. What could you tell us about measures currently under consideration to stabilize the global economy, both at home and abroad? What do you need from us in that vein? Secretary Mnuchin. Well, I think, as you know, the President's major concern is focusing on the U.S. economy. So we do want to make sure we coordinate on an international basis, but our first concern is protecting the U.S. economy. The immediate issue, and we are working with the Speaker and Leader McConnell, and we urge Congress to pass legislation quickly. The first priority is funding that will go for small and medium-sized businesses that are directly impacted by this. There are a large number of workers that are going to be required to self-quarantine or be at home to take care of family members who are self-quarantined. For small and medium- sized businesses, we think it is appropriate for the Government to pick up those costs. This is a little bit like a hurricane, and we need to cover these outside of normal expenses. We are also looking to increase SBA lending dramatically. We have a current program. We need more authorization for that program. We are also looking, and this we can do on an administrative basis, we don't need Congress, but we are looking at providing substantial relief to certain taxpayers and small businesses who will be able to get extensions on their taxes. And we think we can provide over $200 billion of liquidity into the economy by delaying certain tax payments. But we urge Congress to act quickly. The President very much wants to consider a stimulus bill, whether it is through a payroll tax or otherwise. We realize that may not get done this week. So we want to get done what we can do this week, and we will come back. I will also say there may be specific industries. And I want to be clear, this is not bailouts. We are not looking for bailouts. But there may be specific industries that are highly impacted by travel that have issues with lending, and just like after September 11th, the Government authorized certain loan guarantees, we may consider that. And I would just say the loan guarantees are a very effective way of making sure that the Government is paid back without putting the Government at risk. Mr. Rogers. I would assume that would include the airlines? Secretary Mnuchin. I would assume the airlines would be on the top of the list, but it would be--again, it may include other areas, such as hotels, cruise lines, and others. And again, this is something we will be working with industry and coming back to Congress. But the President feels very strongly that we need to protect industry, not bailout, but provide relief to small and medium-sized business. And whatever powers we need to make sure our airlines and our travel industry can get through this, we will. Mr. Rogers. This question is going to refer not necessarily to the monetary end, but the health side. We are being told that large gatherings are not to be attended to avoid passing of germs. We have got the National Basketball Association NCAA tournament coming up with huge gatherings of fans all across the country. Do you anticipate that there would be a move to prevent the public from going to those ballgames? Secretary Mnuchin. Well, let me comment first. I have enormous confidence in our professional health professionals. This is an area that I haven't previously spent anything like this period of time. I am immersed on this in the committee. And whether it is the people at CDC, whether it is the people at NIH, whether the people at HHS, we have enormous expertise. This group is advising the task force and the Vice President daily. This group is coming out with guidance to the States. I would say in general, most of these decisions will be decisions of the Governors on a State-by-State basis. But we are--we will be updating the guidance. We are meeting, actually, with the President today to give the President an update on guidance. I am not going to answer your specific question, but I can tell you those are the types of things that the task force is reviewing. And again, I would say it is mostly--it is most likely going to be State-by-State recommendations. So this is not a ``one size fits all'' approach necessarily. Mr. Rogers. Well, of course, these national associations that we are talking about, our national programs like basketball, NCAA, is not subject to local control. Governors don't control the NCAA. Only national associations that I am talking about. Do you anticipate that those national associations would come to some agreement to restrict the attendance of the public at these large sports events, for example? Secretary Mnuchin. I am not trying to deflect your question. We are addressing these types of issues, and the task force will be making recommendations. As you have said, in certain cases, these will be Governor decisions. In certain cases, they may be Federal decisions. In certain cases, they are private decisions. So I can tell you private companies, as I have said, have already reacted to pretty much canceling all large events. I can tell you I saw on the news yesterday Coachella in California is postponed until October. So, again, I don't want to give you an answer to a specific event, but I can tell you these issues are being addressed, and recommendations will be made by the task force. Mr. Rogers. Mr. Secretary, we appreciate your work. This is tough stuff you are going through. And none of us, especially you and the administration, have ever been through this before. So this is we are in a new field here. But thank you for your service, and thank you for staying with it. Secretary Mnuchin. And again, thank you for saying that. And I want to acknowledge these are difficult issues, but I also want to just put this in perspective, as I have said before. Both on the economic side, when there was a financial crisis, people were concerned that was going to go on for years. This will not go on for years. I am highly confident, listening to the medical professionals, that the medical approaches will develop quickly in being able to address these that, again, this is something we need to deal with for a period of time. And again, I want to just emphasize for children, this is less harmful than the flu. For most young or middle-aged Americans, this will be similar to the flu. And that there are parts of our population that we are particularly focused on that are the elderly, particularly with other issues, that are having more impactful. But I want to emphasize to the committee and to the American public we will get through this. Mr. Rogers. Thank you. The Chairwoman. Thank you again. Ms. Lee. Ms. Lee. Thank you, Mr. Secretary. Good to see you. I would like to ask you a bit about Sudan. I visited Sudan a couple of months ago with Congresswoman Bass and a bipartisan delegation, and we were cautiously optimistic about the progress of the new government. I have to ask you these questions because Secretary Pompeo won't come, and I know some of this jurisdiction is probably within State, but I know you do have some jurisdiction with regard to terrorist financing and what have you. First of all, Sudan is on the list of state sponsors of terrorism. We were looking at should we de-schedule or not, and we have introduced legislation asking to expedite this review process. One of the issues we learned when we were there was that it is very difficult to identify any terrorist financing because of sanctions and because of multilateral sanctions and also because other countries are caught up in the United States, of course, sanctions as it relates to, or as a result of, state sponsors of terrorism. And so, again, I understand the State Department is responsible for delisting or de-scheduling if, in fact, that is going to happen. But I would like to get your take on the sanctions, the multilateral sanctions and the issue of terrorist financing because I know that someone, that Mr. Marshall Billingslea was in Sudan this past weekend looking at this. And so how does all of this work with other countries and other multilateral organizations because of what the United States has not moved forward yet on? Secretary Mnuchin. Well, on sanctions broadly, we coordinate very, very closely with the State Department. Certain of the sanctions authorities are managed by the State Department in consultation with us, and certain are the other way around. But I assure you, we are very much coordinated. Secretary Pompeo and I have specifically talked about these sanctions. I will also tell you I have spent an incredibly large amount of time with both the Foreign Minister of Sudan and the Water Minister of Sudan because you may have seen in the press at the President's request, I have been helping to negotiate an agreement between Egypt, Ethiopia, and Sudan on their dam. And I feel that, first of all, let me just say I think the government in Sudan is absolutely making the right improvements and working in the right direction. We like what they are doing. I would also say if we can reach an agreement on this dam, it will bring tremendous economic benefits to Sudan. The creation of electricity, as you know, there are many people in Sudan that do not have access to electricity. It will also bring important economic help to the region. So I can't comment specifically on this, but I can tell you we are in direct discussions with the State Department on the sanctions. Ms. Lee. Sure. But what I wanted to drill down a bit on is in terms of terrorist financing, that is within your jurisdiction, right? Secretary Mnuchin. Yes. Ms. Lee. And so I know that this is an impediment, having Sudan on the state sponsors of terrorism. How does that work with regard to our assessment of whether or not terrorist financing is taking place, as well as other countries and other multilateral institutions who, as a result of what we are doing, they have a problem also? Secretary Mnuchin. So we have given very direct input, both us and the State Department, to Sudan, what they need to be doing. As you said, Marshall, who works for me, was there this week. So we have had very direct discussions. In this environment, obviously, in an open environment, I cannot go through the specifics with you. But we are in very direct conversations with the government there. Ms. Lee. OK. Then I would like to follow up with you because I think, based on what we learned and what we saw, we have a very short window to move forward in terms of supporting the new government of Sudan or we will see some backwards turns in terms of where they are heading. On Iran, let me ask you about the maximum pressure campaign and the drastic implications it has on the Iranian people now in terms of just financing humanitarian imports, given that Iran has one of the highest numbers, actually, outside of China is one of the epicenters for the COVID-19 virus. And so, yes, much of the blame is on the Iranian government. But reports indicate that sanctions really may inhibit now the importation of test kits and medical equipment and medical devices. So can you kind of let me know what is taking place in terms of direct assistance maybe to Iran through a third country, or what is the status of this, given the state of the emergency? Secretary Mnuchin. Sure, thank you. That is a very good question. So our sanctions programs have always allowed for exceptions for humanitarian aid and medicine, and our--we have always made very clear our issues are not with the people of Iran. We want to make sure that they have access to that. Even before the virus, we started working on what we call the humanitarian channel with the Swiss. Last year, we were able to do the first transaction through that. And what that means is that countries or entities that want to provide humanitarian aid, in essence, if you go through this channel, OFAC will, in essence, provide a green light for that transaction. It is a heightened due diligence transaction. And we did that even before the virus because we wanted to make very clear our issue is not with the people of Iran. I can tell you I have made very clear at the G-7 and the G-20, again that that channel is open, that people that want to, particularly as a result of the virus, contribute to Iran, we support the people of Iran. Our issue is with the government of Iran, and they are using the people's resources on nuclear development. Ms. Lee. OK. If we have a second go-around, I have another question that I would like to ask you later. Thank you, Madam Chair. The Chairwoman. Thank you. And following up on your question, the fact that last week the Treasury Department decided to exempt humanitarian trade involving the Central Bank of Iran from economic sanctions in light of the coronavirus. How is Treasury planning to ensure that the Central Bank of Iran uses this humanitarian exception appropriately? Secretary Mnuchin. We would be happy to follow up with your office because it is a long and technical answer. But the answer is we have put through on this Swiss channel what we call ``heightened due diligence.'' So it allows OFAC to have complete visibility to where the money is coming from, where the money is going to, and for us to make sure it is not diverted for illicit activity and things that should be sanctioned. But we would be happy to follow up on a technical basis and explain that to your staff. The Chairwoman. Thank you. That would be very helpful. Oh, Ms. Meng, I think you are next. Ms. Meng. Thank you, Madam Chair. Thank you, Mr. Ranking Member. And thank you, Secretary, for being here today and for your leadership during this difficult time. I wanted to ask about a letter I wrote to you in December, expressing concern about an American Muslim woman from New York City who used her Venmo account to pay for a meal at a Bangladeshi restaurant named al-Aqsa restaurant. She was soon contacted by Venmo to ask for a full explanation of her transaction. And what we have been hearing is that this is part of a larger trend in which banks have closed, often without justification, credit and bank accounts of customers perceived as Muslim. And for an American Muslim or anyone to learn that their account, including identifying personal and financial information, has been flagged to OFAC based on simple search terms that implicate them in terrorist activities is unsettling. According to your office's response--and thank you for the response--OFAC encourages companies to use the specially designated national and blocked persons list to employ a risk- based approach to sanctions compliance but does not mandate or require any specific screening regime or stipulate specific terms for our financial institutions to use. So my question is when a Venmo or a PayPal account is flagged for the inadvertent use of a term that is on that SDN list, what personal information from that account, if any, does OFAC retain, and is that information used for any other purpose? Secretary Mnuchin. I actually do read the letters that you all send to me. So I want you to know that. I don't always remember every single letter, but I actually do remember your letter. My team just handed it to me, but I don't need to look at it because it was one of those letters that was very specific. And I do remember I inquired with our team about and saw our response. I don't know the exact answer to what you are describing because it is highly technical, but I will ask my team to follow up. But I was assured when I reviewed this that this was not as a result of something that OFAC was doing. Ms. Meng. OK, sure. I would love to follow up because I think people are just very nervous. This was in this case a young girl, woman who was just going out to eat at a restaurant with her local friends and was just trying to Venmo the money back to her friend to repay. And well, can I ask, will OFAC work with companies like Venmo to ensure that they are using smarter technology to contextualize transaction descriptions that might overlap these types of terms in order to avoid infringing on the privacy of users who are clearly not supporting terrorist organizations? Secretary Mnuchin. Let me just emphasize it is unfortunate of this specific situation, and when I looked into this, I wanted to make sure. OFAC puts out guidelines, and I don't think anything in the OFAC guidelines is what caused this. We put out guidelines how people administer the BSA and the sanctions list. Obviously, we encourage companies to have different approaches. So I am not sure it is OFAC's job to go out and fix every single company's issues, but I assure you there is nothing in OFAC's guidelines on that we think would encourage this type of behavior. And as I said, we will follow up with you more on the specifics. Ms. Meng. Thank you. I appreciate that. My other question is coronavirus related. I know that you have been named as a member of the President's coronavirus task force. I wanted to ask about comments. Last week, Lea Gabrielle, the coordinator of the Global Engagement Center, warned that Russia is coordinating millions of online false personas that seek to spread misinformation about the virus. What is the task force doing to combat this and to ensure that accurate information about this pandemic is the prevailing online narrative? I am concerned that the President's comments, which have gone against CDC guidance that coronavirus isn't really dangerous, that people with minimal symptoms should continue to go to work, that those comments would feed into this Russian propaganda threat. Secretary Mnuchin. I don't think that the President's comments are inconsistent with the guidance. What I would say is that this situation is evolving very, very quickly, and the---- Ms. Meng. Sorry, Secretary. He has made comments that people with coronavirus could and should continue to go to work and that the coronavirus isn't really dangerous. Secretary Mnuchin. I don't believe he said that people with the coronavirus should go to work. I think what he said was that for most people, OK, that they can go about their business, that the coronavirus, OK, that the risk for most people getting it is very low. And if someone gets it, it is very low. That is still true. Having said that, our guidance is now more specific. There are areas of the country where the guidance has changed. And again, this guidance has been reviewed with the President, and he agrees with that. It is now much more specific. And as it relates to the first part of your question, I am not familiar with that, but I don't consider that to be the task force responsibility, but I can assure you the intel community looks at those types of things. Again, I am not familiar with it and can't opine on it. But what you are referring to sounds more like an intel community issue than a task force issue. Ms. Meng. My time is up. Thank you. I yield back. The Chairwoman. Ms. Frankel? Ms. Frankel. Good morning. Thank you, Madam Chair. Thank you, sir, for being here. I want to pick up on some of the coronavirus questions. So what industries do you expect are going to be hardest hit? Secretary Mnuchin. I think at this point, it is clear that the travel industry in particular is going to be the hardest hit. That what we are seeing is similar to after 9/11, there is a big impact on airline travel. Unlike a recession where airlines lower the price of tickets and more people fly, this obviously, we just have a complete decrease in volume. So as I said earlier, there may be needs to come back to Congress like we did after September 11. And again, I don't want to--this is not a bailout. This is considering providing certain things for certain industries. So I would say, you know, airlines, hotels, cruise lines I believe are the areas that are impacted. But again, our focus is also on small and medium-sized businesses that are particularly associated with these industries. There are many industries that will go on fine. Many industries can telecommute very easily. Many areas of the country still don't have cases or have very few cases. So, again, this is something we are going to have to look at very specifically. Ms. Frankel. I am sorry, Madam Chair, if I am repeating some questions that were asked. But what are some of the ideas that you are circulating in terms to help these industries? Secretary Mnuchin. Right now, our focus--and again, I would kind of say this is the first and second inning. Right now, we are working with Congress on making sure that we can reimburse workers who have to be home on sick leave, OK? For many times, they are quarantined for 2 weeks. They may or may not even be sick. They may have been in contact with someone who is sick-- -- Ms. Frankel. So, excuse me, just to reclaim. So that would be something like paid family leave? I am assuming that is something I know I have heard the President mention. Is that something that is on your list of---- Secretary Mnuchin. It is, and I have spoken to the President and the Speaker and others about that, and that is what is being worked on immediately. Ms. Frankel. And what would be the form of the payment in the plan that you are working on? Where would the money come from? Secretary Mnuchin. Well, the money would come from the Federal Government. We are actively looking at how we disburse it. There are alternative mechanisms that we are exploring on how we can most effectively disburse. But this would be the Federal Government reimbursing companies so that they could pay the workers, and whether the money goes direct to the workers or the money goes to those companies to the workers, we are figuring out the most efficient way---- Ms. Frankel. Well, let us just make sure that--first of all, I think this is a good thing to be looking at paid family leave. I just want to make sure that the workers actually get it. Which gets me to the next--there had been some talk about a payroll tax cut, and I have a question relative to that because I think would--this sounds sort of---- Well, let me just ask the question. A payroll tax cut could actually encourage someone who was sick to come to work? Secretary Mnuchin. No, I don't see that as the case at all. Ms. Frankel. Let me ask you that question a different way because I want to be fair here. What do you think a payroll tax cut would do in this environment? Secretary Mnuchin. There are two ways of dealing with the issue. One is dealing with very specific issues, as I have just said. A person is in home quarantine, they are not even sick. They are in home quarantine because they randomly came in contact with someone. They work for a small business. They don't get covered. We think those people should be covered. That is very direct. So there are---- Ms. Frankel. Be covered by what? Secretary Mnuchin. They should--the Federal Government should make sure those people get paid for those 2 weeks. Ms. Frankel. So that is--OK. Secretary Mnuchin. So there are some very specific things. Ms. Frankel. I could agree with that. Secretary Mnuchin. OK. As it relates to there are other issues where the entire economy is slowing down, again only because not because of a specific issue that anybody is sick. Because every company in the U.S. right now is stopping travel, stopping meetings, and everything else. That has impacts on restaurants, hotels, everything. Ms. Frankel. I understand that, but just get to the payroll tax cut. How would that help? Secretary Mnuchin. The payroll tax cut, the payroll tax cut is a stimulus mechanism of putting money into the economy. Ms. Frankel. But is that why--oh, I am sorry to interrupt you. That is why putting--that puts money into the individual worker's pocket. Is that correct? Secretary Mnuchin. That is correct. Ms. Frankel. OK. So I am just putting this out there. I am going to ask you this question. Do you have to come to work or not? Do you have to come to work to earn the money for the payroll tax cut, or are you thinking of a scheme where you were going to get that money regardless of whether you come to work? Secretary Mnuchin. Well, I don't like the word ``scheme''-- program. Ms. Frankel. Program, program. Program, program. Secretary Mnuchin. Again, let me just say there are two different things, and I want to emphasize this, and it is an important issue to understand. Ms. Frankel. Yes, OK. Secretary Mnuchin. I want to emphasize this. Ms. Frankel. Thank you. Secretary Mnuchin. One is there are people who we are encouraging not to come to work, OK, because based upon State guidance and CDC guidance those people should be in self- quarantine. We don't want to penalize those people from not getting paid if their company is not covering it. Ms. Frankel. Right. Secretary Mnuchin. JP Morgan and the big banks are covering it. We don't need to reimburse them. Ms. Frankel. So you want to give them some money back, and I am sorry to keep---- Secretary Mnuchin. I want to make sure that those hard- working Americans get paid for the 2 weeks---- Ms. Frankel. And how will that happen? What are the ideas for that? Secretary Mnuchin. I have just said to you there are two ways of distributing the money. One is directly to that person in the form of a debit card or a direct deposit. Ms. Frankel. Got it. Secretary Mnuchin. The other is making sure that the companies continue to make those payments and that the company will be reimbursed. The only difference is we are just trying to figure out very quickly mechanically how we can do it. It is not a philosophical question. Ms. Frankel. OK, but that is not a payroll tax cut. Secretary Mnuchin. That is not. The payroll tax cut has nothing to do with whether you are home sick. The payroll tax cut is money--it is an efficient way of getting money to all the hard-working Americans. Ms. Frankel. But you have to come to work to earn that money. Correct? Secretary Mnuchin. Let me be clear, OK? If you are home because you are in a sick situation, you would get that money as well. That money would go--that money goes to everybody across the board to stimulate the economy. So it doesn't in any way encourage you you have to work or you don't have to work. It is completely independent. Ms. Frankel. All right. Yes, I think I have used up my time. Thank you, Madam Chair. I yield back. The Chairwoman. Mrs. Torres? Mrs. Torres. Thank you, Chairwoman. And thank you for being here with us once again. I want to continue on a little bit just because I think it is really important. Constituents that I represent don't get to have an audience with you. So that is my job to do. China shut down a lot of its shipments into the Port of L.A. and Long Beach. My constituents work when shipments are coming in or leaving to those locations. So let us just take Amazon as an example. There are employees that work directly for Amazon. I assume those employees will be taken care of. But there are contractors that do data entry for Amazon whose contracts have already been canceled. Many of them are independent folks. Gig workers such as Uber drivers are already being impacted because, as you have stated, there are cancellations of conferences and different things. As an example, coming here on Sunday night from Dulles to DC, my Uber driver worked 12 hours on Saturday night, and he earned $60. So this is not someone who is just sitting at home, waiting to be called back to be returned to work. It is simply there is no work out there for them. I want you to think about it from the perspective of when the bottom fell out of the housing market. We want to make sure that we are protecting people that need to pay rent, that need to pay their mortgage, and I want to applaud the effort that you have talked about to temporarily halt payments to the IRS that are due April 15. That is a good step in the right direction. But I want to make sure that while we are looking to--and I know you don't want to use ``bailout.'' But while we are looking to assist the airline industry and major cruise airlines, I am not going to vote for a bill that comes before me that does not include the poor working people that I represent or the people that I come across every single day. I just want to make sure that you understand that. That is going to be what I am looking at very, very closely. Secretary Mnuchin. I appreciate that, and let me just emphasize that is also the President's No. 1 concern. Mrs. Torres. Thank you. Secretary Mnuchin. So, as I said, I want to emphasize it is critical that Congress act quickly. This isn't going to be the first time--I mean, this isn't going to be the last time we do this. So we want to get something done quickly, but I can assure you we are going to be back one, two, three, four times. The hard-working people, small and medium-sized independent people that are directly impacted by this, OK, that is where we need to provide economic support. And the President and I agree with you 100 percent. Mrs. Torres. I also---- Secretary Mnuchin. I have addressed people who may be home because they are sick. There are also areas, as you said, where kind of having no fault of theirs, because travel has shut down, all of these other people that work around these industries will need to be helped. Mrs. Torres. It is also my job to ensure that you are addressing public corruption in the Northern Triangle, and so I want to discuss OTA, what OTA has done in Central America. Migrants continue to come north. The government in Honduras is maxed out on corruption. I don't know that there has been an envelope that hasn't been given to the president that he has not accepted in cash payment. So in your 2019 project report, we saw that OTA engaged with Guatemala and Honduras, but not on issues of economic crime. Whereas, OTA worked with other countries on money laundering and anti-corruption measures. Is OTA really interested in dealing with the root causes of migration in Central America? Secretary Mnuchin. I think they are, and I think OTA provides very important resources, and we appreciate the committee funding it. And as to the specifics of what you are talking about, we are happy to follow up with your office. Mrs. Torres. You are asking for an increase, $33 million in fiscal year 2021. So what kinds of programs does OTA plan to use that funding for, and would OTA look into using this funding to increase the work within the Northern Triangle, including Panama? We talked about a lot of letters that come to your desk. I wrote a letter in November of 2017. The NGO Global Witness alleged that there was drug trafficking and money laundering that occurred that might have involved the Trump Ocean Club Panama. I still haven't heard anything on that. So I want to make sure that we are focused. If you are asking for an increase, that that increase is going to be to deal with crimes of public corruption and drug trafficking as it relates to money laundering. Secretary Mnuchin. I agree, and we will follow up with you. Mrs. Torres. Thank you. I yield back. The Chairwoman. My friends, I think we will do another round, although, Mr. Rogers, you are sitting there lonely. I will ask a question, then I will turn it over to you. One of my favorite issues not because they are so successful, but I keep trying to get information and hope they will be successful, and that is the Office of Technical Assistance. The Office of Technical Assistance often sends technical advisers to work beside officials in host countries for an extended length of time in order to help improve their capacity to manage public finances. I would be interested to know if there are partnerships that have worked according to your standard. Are they achieving the intended objectives? How does this support help keep countries from falling into debt traps? And how does it decide where to engage? For example, your office, this office I believe was involved in Afghanistan when Ashraf Ghani took control. Many of us had great hopes for Ashraf Ghani because of his prior work experience. Just as an example, if you could discuss that or any other area where perhaps you can share some successes of this office? Secretary Mnuchin. Well, I---- The Chairwoman. I see you are smiling. Secretary Mnuchin. I am smiling because Afghanistan is obviously a complicated situation an---- The Chairwoman. You can use other examples of this office. Secretary Mnuchin. I am sorry. This office is OTA, or this was the---- The Chairwoman. It is the Office of Technical Assistance. Secretary Mnuchin. Yes. So I think there is really in many places, let me just check. I think, again, we had a question earlier on the Northern Triangle, but El Salvador, Guatemala, Honduras. I know there are countries in Africa. I know there is--really, this has been a project where I really think it has been successful all over the world. And the real issue for us is it is only $33 million, and we have to figure out how we limit our resources because I constantly have countries who ask us for technical assistance. So whether it is around raising revenues or other issues, this is--you know, we have asked for a small increase, but this is something that we think is well paid for. The Chairwoman. I would appreciate it. To me, this is one of the most important functions, and I would appreciate following up with you. If there are examples of success, how did it work? What happened? Northern Triangle was another story. This committee was pretty outraged. The Government--our Government just held up the money for 6 months. Secretary Mnuchin. I understand. The Chairwoman. We never sent the money over there. I don't know if you had anything to do with it, but if you did I would love for you to have the opportunity to tell me about it. Secretary Mnuchin. I had no involvement in it. And let me just make--I think I made a comment earlier, and somebody in the room must have picked up. I was referring to our No. 1 economic priority was on small and medium-sized businesses. Someone interpreted that I think incorrectly in the room back there. Our No. 1 priority is obviously protecting health and human life. I was only referring to the economic issues. The Chairwoman. But in any event, I would like to follow up on OTA, and I think it would be helpful for us--oh, my goodness, isn't that good? So your staff is giving you some additional information. Secretary Mnuchin. What we are going to do is I will send you a report that you can distribute to the committee that has a full analysis over the last year, these are the countries we have provided assistance, and this is what we have done. So there is complete transparency, and the committee can understand that. The Chairwoman. And in fact, it doesn't have a huge amount of funds. But these services, in my judgment, have been desperately needed in so many parts of the world. And it would be very good if, in fact, you can give us examples of success and where we can use these principles---- Secretary Mnuchin. We will absolutely do that. And you know, I am known as a micromanager, but this is something that is actually even below my radar. So we will provide you the report. The Chairwoman. I am known as a micromanager, too. But I really don't know of examples of success there. So I thank you. Mr. Rogers? Mr. Rogers. Thank you, Madam Chair. Mr. Secretary, as you know, China's Belt and Road Initiative has both undermined U.S. influence and brought with it a wide range of problems associated with corruption and debt burdens. Many have focused on the new U.S. International Development Finance Corporation as the principal means by which the U.S. can counter China's lending model. While the DFC is an important tool, we need everyone working toward this effort in a concerted way. In this regard, how can Treasury help shape the rules of the road and bring greater transparency to China's opaque practices abroad? Secretary Mnuchin. As you mentioned, the U.S. Development Finance Corp, it is one of our tools. But that is just one of our tools. And we are very focused, both at the IMF and the World Bank, on debt transparency. We think this is critically important. And in certain programs, we have required in these institutions for the countries to get the programs renewed that we had complete debt transparency as related to loans with Belt and Road in China. And I want to be perfectly clear. We are not using and we are not ever going to be using money from these international organizations to pay back China. Mr. Rogers. How do you see the role of the World Bank and the Asian Development Bank countering the China model in the Indo-Pacific region? Secretary Mnuchin. Well, I think the World Bank in particular is incredibly important, and this has been a great institution, post war institution. The U.S. has shown great leadership. We are very pleased that David Malpass, who used to work for me at Treasury, is now leading the organization. He has been moving forward many reforms, and we think that it is a great source of funds to countries that need it. Mr. Rogers. Switching subjects, Mr. Secretary, last year as we hosted the eighth annual national Rx Drug Abuse and Heroin Summit in Atlanta, at which the President and First Lady attended--and by the way, the ninth edition of that summit is coming up in early April, becoming now the premier place for the discussion of opioid research. I know combatting the flow of fentanyl and other opioids into the U.S. has been a top priority of this administration, and we thank you for that. I am cautiously optimistic that we are making some progress with China on fentanyl and other opioid issues, and I hope you agree. I know that Treasury's Office of Foreign Assets Control has used the Foreign Narcotics Kingpin Act to target the assets of Chinese fentanyl traffickers. What can you tell us about this effort and the efforts of the men and women working on issues of terrorism and financial intelligence to help break these trafficking networks? Secretary Mnuchin. Thank you. I think this is an issue that is very important to the President, as you know. China has made significant progress. That is the result of at one of our summits, President Trump specifically asked President Xi to change the laws, which he agreed to do and has been working with us. Notwithstanding that, there are times where there are things going on that they even can't control, and OFAC will use its tools, as you have identified, to do whatever we can to stop illicit activities. Mr. Rogers. Well, the experts tell us that within the world of opioids and look-alikes that fentanyl is by far the most deadly and the one most difficult to stop. So I appreciate the work that you are doing and the administration in fighting this fight. It is way from over. We need to keep more pressure on the Chinese because that is where all of the fentanyl is coming from. It is not just a piece of the world. It is the world of fentanyl. And we ask you to keep up the good work. Madam Chair, I yield back. Thank you, sir. The Chairwoman. Ms. Lee? Ms. Lee. Thank you very much. OK. Mr. Secretary, let me ask you a couple of questions. One is you are on the interagency task force, right, as it relates to COVID-19? Secretary Mnuchin. Yes, the White House task force. Ms. Lee. Yes, OK, White House task force. Excuse me. I asked Dr. Redfield yesterday about this. Every committee hearing I am attending I am asking, so I can wrap my hands around what is going on as it relates to hand sanitizers. And Dr. Redfield said yesterday it was the White House task force that was looking at this or responsible for it. CDC did not know the lack of availability. First of all, when you look at the directives from CDC and our health agencies, the directives are in terms of prevention of the transmission or contracting the virus is washing one's hands at least 20 times. But secondly, if that is not available, and a lot of places don't have clean water, use the hand sanitizers. Well, first of all, if you can't find the hand sanitizers. And you know, I have been in 3 cities in the last 7 days. None, there are no hand sanitizers available. What does one do? I started looking and doing some research and found that now people are making their own, using alcohol and aloe vera. I guess sooner or later, alcohol will not be available. What is the task force doing in terms of the supply chain and the directives for people in terms of the public health directives are useless if, in fact, you can't find hand sanitizers. And Dr. Redfield said the task force is responsible for this. Secretary Mnuchin. First of all, let me say thank you for raising the topic. I think on the hand washing, I just want to clarify, I am not 100 percent sure, but I think you are supposed to wash your hands for 20 seconds. Ms. Lee. I mean--what did I say, 20 minutes? Secretary Mnuchin. Twenty times. Ms. Lee. Twenty times. Twenty seconds, excuse me. Secretary Mnuchin. I just wanted to, for everybody's benefit, clarify that. Ms. Lee. Twenty seconds. Secretary Mnuchin. It may end up being you wash your hands 20 times a day as well. Ms. Lee. Or more. Secretary Mnuchin. Specifically, I will follow up on this. The answer is we have the task force. There are then subcommittees of the task force. I am sure somebody is looking at this. I will follow up. Ms. Lee. I hope so, but no one has been able to answer, and I am getting ready to go to Ag, and I understand FDA now is the authority. Secretary Mnuchin. Well, we are having a committee meeting this afternoon. I assure you I will address it. Ms. Lee. You will do that, and would you let us know the response right away because people are becoming very concerned about this. The second question I have is just going back to Iran and secondary sanctions. If banks can't purchase humanitarian supplies, medical supplies, how are what we are doing allowing these supplies to be distributed in Iran, given the emergency? So how do secondary sanctions weigh in with this? Secretary Mnuchin. Both primary sanctions and secondary sanctions, there are exemptions for humanitarian transactions. So banks are able to participate. And again, these transactions need to be properly vetted. Ms. Lee. Sure. Secretary Mnuchin. And the reason why we set up the Swiss channel, but the answer is in this case of this channel, obviously, banks are involved. And again, if you go through the Swiss channel, effectively you get a Good Housekeeping seal of approval, and the bank doesn't have risk for that transaction. Ms. Lee. OK. Secretary Mnuchin. So that is why we wanted to facilitate that. Ms. Lee. Thank you very much. The Chairwoman. Secretary Mnuchin, I know how busy you are. I want to thank you for your time. I want to thank you for appearing before us. And this concludes today's hearing. Secretary Mnuchin. Thank you for letting me out early. The Chairwoman. The Subcommittee on State, Foreign Operations, and Related Programs stands adjourned. Thank you so much for being here today. [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]