it is always important to broaden the field of participants, we consider it a higher priority in the next five
years to endeavor to improve the structures and mechanisms of competition themselves, and to hold
government more accountable to all citizens between elections.
Nevertheless, it is important to emphasize that there is a great deal of absorptive capacity for donor
support in Peru, primarily within vibrant civil society organizations.  If additional resources were to
become available to USAID's Democracy and Governance programs (which we would strongly endorse),
much more could be done to promote a new and more diverse generation of leaders, and to involve larger
number of citizens in positive experiences of democratic governance, particularly at the local level.
USAID's Prior Strategy and Existing Program
USAID/Peru made many sound strategic judgements over the last five years that need to be built into
strategic recommendations. First, the Peru Mission concluded several years ago that both inclusion and
competition issues deserved greater attention in the present context. In 1996 and 1997, it became clear
that the initial optimism about direct support for government institutions and reforms following the 1995
elections was unwarranted. In response, USAID/Peru modified its strategy to focus directly on preparing
for the 2000 Presidential elections, highlighting increased citizen preparedness to exercise their rights
and responsibilities. USAID severely curtailed assistance to government institutions and initiated a series
of pre elections activities to obtain meaningful political participation (e.g., using the mass media,
working with policy advocacy groups, targeting activities geographically to reach the most voters,
integrating democracy themes and activities into USAID's work in other sectors, and highlighting
election participation and observation).
The soundness of these decisions, in turn, earned USAID a great deal of respect within sectors formerly
critical of U.S. policy, particularly within civil society and the human rights community. Most of Peru's
democracy program continues to be implemented through grants to local NGOs, although USAID
partners also include the 
Defensoria del Pueblo
, one of the most autonomous and respected institutions
within the government today.   Since many local NGOs are proven and successful partners, a move away
from the present strategy is likely to disappoint and even potentially alienate these groups. 
The strategy
recommendations outlined below seek to preserve the respect that USAID has earned and to build upon
ongoing activities, to the extent that they are tied to the democracy priorities identified through our
Activities of Other Donors
USAID's involvement in an active donor coordination group related to democracy and governance was
effective in encouraging other donors to enter the Democracy and Governance area and to co fund
entities like the 
, thereby guarding against criticisms that these institutions
are controlled by the U.S.  Based on this precedent, it seems likely that USAID could engage other
donors to work together on a new strategy, and/or to assume responsibility for funding former USAID
grantees that are less critical for this new stage, such as those partners that focus on conciliation and on
general civic education.  Similarly, because the World Bank and IDB give priority to government led
programs, USAID might explore the interests of these institutions in assuming potential future
interventions with the Judiciary, Congress or local government, as opportunities arise, since these
programs can be extremely costly.
H:\INCOMING\July24\MSI Submission\Fn Email.doc

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