Two projects—coal industry restructuring and housing sector reform—met or exceeded their objectives. Three projects—health care, commercial real estate, and environmental policy—met few or none of their objectives. These projects were effecting change because they had sustainability—benefits that extend beyond the project’s life span—built into their design and they focused on issues on a national or regional scale. Also, Russian officials said the project had little or no effect on the availability of commercial real estate in their cities. Common Themes to Successful Projects

Successful projects (1) had strong support and involvement at all levels of the Russian government, (2) had a long-term physical presence by U.S. contractors in Russia, and (3) were designed to achieve maximum results by supporting Russian initiatives, having a broad scope, and including elements that made them sustainable. A critical element to a project’s success was the degree to which Russian officials were committed to reform in the particular sector. In contrast, some projects were not designed to maximize their potential impact. However, to respond quickly, USAID made certain exceptions to its normal procedures and processes. USAID/Moscow has adequately managed and monitored the project. The project did not contribute to systemic reform and was not sustainable. This regulation contributed to the poor results of the project. III.1 and III.2.) 3. 4. 5. 6. 7. Although we recognize that this project was only one of many in the energy sector, we found that the project is unlikely to contribute to systemic reform because of its design and the lack of monitoring and follow-up by USAID.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the Agency for International Development's (AID) assistance projects in Russia, focusing on whether: (1) individual AID projects met their objectives and contributed to systemic reforms; (2) the projects had common characteristics that contributed to their successful or unsuccessful outcomes; and (3) AID adequately managed the Russian projects.

What GAO Found

GAO found that: (1) some of the projects reviewed fully met or exceeded their objectives, while other projects met few or none of their objectives; (2) three AID projects contributed to fundamental structural changes in Russia because they had sustainability built into their design and they focused on national or regional issues; (3) the successful projects had broad and strong support from all levels of the Russian government, U.S. contractors with long-term physical presence in Russia, a broad scope to maximize benefits, and specific sustainability objectives, and complemented or supported Russian initiatives; (4) Russian officials' commitment to reform in certain sectors was critical to project success; (5) the unsuccessful projects were poorly designed and implemented and often had little or no impact on problems; (6) AID made certain exceptions to its normal procedures and processes in its desire to respond quickly to assist Russia; and (7) AID failed to adequately manage some projects because of problems in delegating management and monitoring responsibility to the Moscow AID office, inadequate staff, and inadequate management information systems.