In fiscal years 2002-2004, State and USAID formally reviewed existing  bilateral economic assistance programs in the Middle East and North  Africa. State and USAID have used the reviews of existing U.S. bilateral economic  assistance programs, as well as information obtained from other U.S.  entities providing assistance in the region, to realign many existing  programs, strategic plans, and coordination mechanisms to conform to the  new U.S. policy of promoting democracy and reform in the Middle East  and North Africa. MEPI and its administrative partners  negotiated agreements with NGOs, the private sector, and other U.S.  government entities to implement more than 100 projects. MEPI and Administrative Partners Have Obligated 2002-2003 Funds

MEPI and its administrative partners have obligated the $129 million that  MEPI received for fiscal years 2002 and 2003. Reviews and Other Information Have Led MEPI to Target New Reform Opportunities

Responding to the reviews of U.S. bilateral economic assistance in the  region, as well as information provided by other U.S. entities, MEPI has  initiated reform activities that were not being addressed by U.S. agencies  in the region, including countries where USAID does not operate. For  example:    Political reform: The reviews found that in many countries where MEPI  operates, little progress had been made in political reform, including  women’s political involvement. MEPI officials told us that these observations made MEPI management  aware of the need to monitor projects’ short-term performance and hold  project implementers accountable for results. Unclear Roles and Responsibilities and Incomplete Information Have Inhibited MEPI’s Project Monitoring

MEPI’s ability to monitor the performance of its projects and measure  results has been limited by (1) unclear communication of monitoring roles  and responsibilities and (2) a lack of complete project information. MEPI and USAID  officials in Washington, D.C., acknowledged that confusion exists  regarding roles and responsibilities for project monitoring. Conclusion

In accordance with the U.S. foreign policy of promoting democracy and  reform in the Middle East and North Africa , State established MEPI to  design and fund projects supporting political, economic, and educational  reform and the empowerment of women. Without the ability to evaluate its projects’  performance with certainty, and lacking access to complete information,  MEPI’s capacity to meet its strategic goals of producing tangible results  and making results-based decisions is limited. Appendix I: Objectives, Scope, and Methodology

In this report, we (1) describe MEPI’s structure for administering projects  and obligating funds, (2) examine MEPI’s uses of the reviews of U.S.  bilateral economic assistance in the region, and (3) evaluate MEPI’s  monitoring of its projects.
Why GAO Did This Study

In December 2002, the U.S. Department of State (State) established the Middle East Partnership Initiative (MEPI) to promote democracy in the Middle East and North Africa. MEPI provides assistance for political, economic, and educational reform and women's empowerment. In fiscal years 2002-2004, State and the U.S. Agency for International Development (USAID) reviewed U.S. bilateral economic assistance programs in the region to ensure they were aligned with the new U.S. policy focus on promoting democracy and reform. In this report, GAO (1) describes MEPI's structure for managing projects and allocating funding, (2) examines MEPI's uses of the reviews, and (3) evaluates MEPI's project monitoring.

What GAO Found

MEPI has worked with U.S. embassies, USAID headquarters in Washington, D.C., and USAID missions overseas to manage projects and obligate funding. In turn, MEPI and its partners have negotiated agreements with nongovernmental organizations, the private sector, and other U.S. agencies to implement the projects. MEPI has obligated about 45 percent of the $129 million that it received for fiscal years 2002-2003, and its partners have obligated the remainder. MEPI used the State and USAID reviews of existing U.S. bilateral economic assistance programs in the Middle East and North Africa in two ways. First, in response to the reviews, MEPI targeted reform activities in the Middle East and North Africa that were not being addressed by other U.S. agencies. For example, responding to the reviews' finding that little progress had been made in supporting women's political involvement, MEPI provided funds to assist women candidates. Second, MEPI shaped its strategy in response to the reviews, particularly regarding the need to monitor projects' short-term results and hold project implementers accountable for project performance. Despite its strategic emphasis on monitoring projects' performance, MEPI's monitoring has been limited by unclear communication of roles and responsibilities and a lack of complete project information. MEPI has acknowledged these deficiencies and begun to address them; in July 2005, State and USAID agreed on a framework for project monitoring roles and responsibilities. Without the ability to evaluate its projects' performance with certainty and access to complete information, MEPI's capacity to meet its strategic goals of producing tangible results and making results-based decisions is limited.