Audit of AID assistance to Guinea

development assistance, nonproject assistance, and food aid provided to Guinea. Program results audit covers the period FY76 through 6/87 and is based on document review and interviews with concerned personnel. The P.L. 480 food aid program has helped the Government of Guinea (GOG) meet food shortages over the years, but results of A.I.D. development projects have been disappointing because of A.I.D. management problems and fundamental policy, financial, and managerial weaknesses within the host government. One of the problems was the unavailability of counterpart funds from P.L. 480 Title I sales proceeds for development projects. Although A.I.D. management, including regional office support, has improved over the years, oversight of Title I proceeds still needs strengthening. The Office of the A.I.D. Representative (OAR/G) has repeatedly failed in its efforts to have the GOG jointly program and release Title I local currency to support development projects, as stipulated under a 1985 agreement. OAR"s failure in this regard can be partly attributed to reluctance to take strong action. As a result, about $11 million in local currency counterpart funds remain unspent as of 6/87. Also, counterpart funds were not deposited in a separate account at a parastatal bank as required. It is too early to assess A.I.D."s new strategy of providing nonproject assistance in support of GOG economic reform. In 6/87, the GOG met the conditions precedent for disbursement of an initial tranche of $5 million. OAR/Guinea agrees with audit recommendations to ensure that counterpart funds are used for development, and is taking corrective action.