effort, contraceptive services are available to no more than 15 percent of the population of developing countries. Although this is a long-term problem, some success is evident in countries such as the Philippines, Indonesia, and India. Future programs will focus on building the institutional framework for family planning through: -effective information systems to reach the rural and urban uneducated poor to encourage positive family planning decisions; -expanding research for better understanding of the economic, social, and other factors which affect population growth; -developing trained manpower; -improving administration and management. Integrated, low-cost health and family-planning delivery systems, imaginatively adapted to the needs of the rural and urban poor, are essential: -Eighty-five percent of the people in developing countries have no regular access to health services. -The expensive medical and health education systems of the industrialized countries are beyond the means of most developing countries. To help meet these pressing problems, our development assistance programs are working to help developing countries: -design low-cost comprehensive health services delivery systems, including family planning education and services; -develop imaginative and adaptive new approaches to the problems of preventive and curative medicine, nutrition, endemic disease, environmental sanitation, and potable water supply. Development and education of human resources-people equipped with the knowledge, skills, and attitudes necessary participate and contribute to their societies-is the bedrock on which all progress has been founded. Lack of educational opportunity prevents the poor majority in the developing countries from participating effectively in the productive process and sharing equitably in its benefits. To contribute to the solution of this fundamental problem, our development assistance program seeks to help developing countries to: -making practical and relevant learning opportunities available to a greater number of people at lower cost; -develop innovative and imaginative nonformal educational and learning techniques to equip the poor majority with the essential knowledge and skills necessary for effective participation in the societies in which they live. FOREIGN DISASTER RELIEF AND RECONSTRUCTION The American people have always helped to reduce human suffering abroad brought about by natural and manmade disasters: -Special disaster relief funds available through the foreign assistance program enable the United States to provide swift assistance in food, shelter, and medical care to people suddenly cast into situations of severe hardship. -The recent appointment of the Administrator of AID as the President's Special Coordinator for International Disaster Assistance provides a means for assuring prompt, effective and well-coordinated responses to disasters abroad by U.S. agencies and between the United States, multilateral agencies, and other donor countries. A new international Disaster Assistance fund is proposed to further improve our ability to alleviate human suffering due to disasters. The fund of not more than $20 million would permit : -rapid responses to urgent relief needs; -transition from short-term relief activities to rehabilitation efforts; -assistance for disaster preparedness, contingency planning, and disaster preIdiction activities. Longer-term reconstruction assistance, which often requires substantial levels of funds, would be subject to separate congressional action. SECURITY SUPPORTING ASSISTANCE The President has ordered a review of our Middle East Policy. We will subsequently be in a position to consider and then propose country assistance levels and their program composition. Similarly, we may be submitting assistance program proposals for: -Portugal, when we have had the opportunity for further discussion with the new Portuguese cabinet on its policies and programs; -Cyprus, when we can make realistic projections on Cypriot refugee relief and rehabilitation needs. Meanwhile, specific program requirements are proposed to finance: -grants to Malta under a NATO defense agreement; -cultural, educational, and scientific programs in Spain pursuant to the Base Agreement of 1970; -technical assistance in management and administration to Bahrain; -economic assistance to Laos formerly provided under the Indochina Postwar Reconstruction program. LEVELS OF TOTAL FOREIGN ECONOMIC ASSISTANCE Despite the growing needs of developing countries, total levels of economic assistance from industrialized countries have been declining in real terms: -Over the past decade, the real per capita income of donor countries (members of OECD Development Assistance Committee), rose 50 percent. -In the same period, the real value of total official development assistance from these countries fell by 7 percent. -As a result, the real value of official development assistance provided to developing countries declined by 30 percent per capita after taking into account population growth. Complementary systems of bilateral and multilateral assistance are essential to maintaining and increasing the flow of assistance to the developing countries: -Both the "old rich" industralized countries and the "new oil-rich" countries can choose the channels most appropriate to their interests. -The international financial institutions offer channels through which large amounts of development financing can be provided on an objective, technical basis. -Bilateral programs are more responsive to the particular priorities and foreign policy interests of donor countries. -Continued U.S. participation in both bilateral and multilateral assistance systems is vital to the needs of developing countries, to U.S. foreign policy interests, and to the encouragement of further increases in assistance flows from other donor countries. U.S. bilateral assistance provides a means for focusing our resources: -on the key problem areas affecting the poor majority in developing countries in innovative ways; -on the countries most seriously affected by the food and energy crises; -on problems and areas of critical U.S. foreign policy importance. The United States must maintain mutually beneficial and interdependent relationships with a wide spectrum of developing countries, ranging from the poorest and most seriously affected, to the newly oil-rich, but less-developed, by choosing the most appropriate techniques at our disposal: -bilateral assistance; -reimbursable development assistance; -contributions to multilateral institutions; -export credits; -guaranty of private investments; -trade preferences. The Development Coordinating Committee, created by the Congress in the Foreign Assistance Act of 1973 under the Chairmanship of the Administrator of AID provides the mechanism for analyzing and coordinating U.S. policies and programs affecting developing countries. THE FISCAL YEAR 1976 ECONOMIC ASSISTANCE REQUEST The fiscal year 1976 request for economic assistance is summarized in the tables which follow. Further detail will be found in: -the next section of this volume, entitled fiscal year 1976 Budget Request; -the supporting volumes which cover proposed programs in: Africa. East Asia. Latin America. Near East and South Asia. Interregional. Management, Personnel, Operating Costs. APPENDIX 2 LIST OF UNFUNDED PROJECTS The following is a partial list of projects proposed to AID missions in the past 2 years either formally or informally-which AID did not agree to finance as they were inconsistent with the main emphases of the new legislation : AFRICA Cameroon-Trans-Cam railroad, third stage. Malawi, Botswana, Swaziland, Lesotho, et cetera-roads. West Africa-telecommunication project. LATIN AMERICA Bolivia-medium-large farmer project. Honduras-urban development. NEAR EAST SOUTH ASIA Bangladesh-shallow tubewells (benefit larger farmer). Pakistan-bread factories in big cities (upper income group was primary beneficiary). Tunisia-national engineering school. EAST ASIA Indonesia-Trans-Java highway, Bandung power distribution, East Kalimantan power generator, Gresik cement-second expansion, Luwu regional development: Airstrip and harbor sections, medical hospital, and major dams. Thailand-urban health centers. (41) APPENDIX 3 STATEMENT OF HON. JOHN E. MURPHY, DEPUTY ADMINISTRATOR, AGENCY FOR INTERNATIONAL DEVELOPMENT, BEFORE THE SUBCOMMITTEE ON FOREIGN OPERATIONS OF THE SENATE APPROPRIATIONS COMMITTEE, JUNE 13, 1975 (1) Section 103: Food and Nutrition Mr. Chairman, members of the committee, I am pleased to appear before you today in support of AID's proposed fiscal year 1976 food and nutrition program. We are requesting an appropriation of $534.5 million to help carry out the purposes of section 103 of the Foreign Assistance Act which are to alleviate starvation, hunger, and malnutrition, and to provide services to poor people, enhancing their capacity for self-help...". 66 Our food and nutrition program for fiscal year 1976 totals $582.3 million, of which $466.2 million is proposed as loans and $116.1 million as grants. This is an increase of $172 million over the comparable program estimated for fiscal year 1975 and represents over 60 percent of the funds planned for activities in the five functional categories. The program is apportioned as follows: Section 103 is broadly interpreted in the legislative history to consist of activities in support of rural production rather than simply agriculture, with the emphasis on mutually supporting linkages between agriculture, industry, and marketing. Thus, our 1976 program includes projects conceived to achieve objectives such as: -Increased food production. -Improved food distribution and marketing. -Improved nutritional content of food. —Provision of information on modern nutrition practices. -Increased income for the rural poor. -Provision of inputs necessary for productive agriculture, such as: -Pesticides. -Seed. -Machinery. -Development of rural market areas and towns. -Development of small scale rural industry related to agriculture. -Development and improvement of rural cooperatives. -Improved rural services, farm -to-market roads, and irrigation systems. -Improved agricultural research necessary to achievement of a number of these objectives. We propose to finance the program as follows: New appropriation__. Recoveries Millions $534.5 47.8 582.8 The "Assessment of the World Food Situation" prepared for the World Food Conference indicates that long-run trends in food production and demand are foreboding. However, I believe that the current U.S. strategy, if vigorously pur |