Maya Gainer is a second-year student in the International Development program at SAIS and the editor-in-chief of SAIS Perspectives.

In the third Development Roundtable of the spring semester, Mercy Corps’ Vice President of Technical Leadership, Dina Esposito, discussed how food assistance has shifted from “in-kind” food transfers to cash transfers, and how aid organizations can take the next step of supporting markets in fragile contexts. A SAIS alum and former Presidential Management Fellow, Esposito played an instrumental role in United States food aid reform as Director of the Office of Food for Peace at USAID during the Obama administration.  She is helping lead a sector-wide shift from in-kind food assistance to vouchers, cash, and beyond. Below are some key takeaways from the discussion.

Food Aid Reform

Historically, U.S. food assistance has been dominated by “tied aid”—shipments of U.S. crops on U.S.-flagged vessels—intended to benefit American farmers and the U.S. maritime industry as well as people in developing countries. However, over time, the nature of U.S. food assistance changed and with its current primary focus on helping hungry people in times of urgent crisis, tied aid often proved to be inefficient and sometimes counterproductive.In addition to high costs and often slow delivery of food to faraway areas of crisis,tied aid risked distorting local markets: American crops delivered to crisis-affected areas could push down prices and harm local farmers’ livelihoods. 

Esposito worked hard during the Obama administration to build on the bipartisan support evident in the Bush era to untie U.S. food aid. In addition to gaining some flexibility in the 2014 Farm Bill overseen by the Agricultural committees of Congress, a major breakthrough came when the Foreign Affairs committees decided to authorize flexible food assistance through new legislation outside of the traditional Farm Bill vehicle.  In 2016, an all cash emergency food security program was authorized by part of the Global Food Security Act, a bill that demonstrated the United States’ continued support for building resilience and fighting hunger and malnutrition. The program built on ongoing USAID efforts and allows for local or regional food purchases closer to disasters as well as cash transfers. “In kind” U.S. food aid went from about 86% of the total USAID food aid portfolio in 2010 to roughly half in 2015.  And by 2017, USAID for the first time had more resources for cash-based programming than U.S. “in kind” food, allowing the U.S. government to ensure that the right response tool is available for any given context. The overall cash programming budget has also grown dramatically, from around $300 million in 2010 to over $1.8 billion last year.  For the first time last year, USAID served more people through cash-based programming than U.S. “in kind” aid.

Cash and vouchers now make up 50% of Mercy Corps’ humanitarian programming, and to date, the organization has distributed $72 million in 13 countries to survivors in urgent need of humanitarian assistance. These important gains were protected in reauthorizations of the Global Food Security Act and the Farm Bill in 2018.

The Next Step: Markets and Resilience

Despite their greater efficiency and flexibility,cash transfers are still a short-term coping mechanism. Drawing on Mercy Corps’ 2018 report Beyond Cash: Making Markets Work in Crisis, Esposito shared how humanitarian aid can better support individuals by helping build resilient food systems. Rather than focusing on short-term assistance in Nepal, Mercy Corps built households’ capacities to plan ahead and reduce risks through savings and improved agricultural production techniques, significantly reducing hunger despite external shocks. 

Resilient systems also requiremarkets that remain functional even during conflict. For instance, in Syria, Mercy Corps brought flour to bakeries struggling to stay open in conflict zones, which helped stabilize bread prices—and maintained neighbors’ social connections far more effectively than if Mercy Corps had distributed bread directly to families. Keeping markets functioning in a crisis and helping households develop the capacity to manage shocks, opens up new possibilities for humanitarian responses and can smooth the transition from relief to long-term development.

After the talk, SAIS Perspectives caught up with Esposito to talk more about the future of food assistance.

Perspectives: In your experience, what strategies keep markets functioning in conflict-affected areas? 

DE: It depends a lot on the context—the tools we use need to be grounded in sound market analysis. It’s important to work with local traders and understand the barriers that prevent them from bringing food to conflict-affected places. For instance, in Somalia during the 2011 drought and related famine, certain traders could access areas where international organizations could not because of their clan affiliation and other relationships. In that situation, we were able to provide cash transfers to households, collaborating with traders to ensure markets could effectively absorb those transfers without creating huge inflationary pressure. In South Sudan, Mercy Corps was able to improve the supply of goods in marketplaces by partnering with local trade associations to help their members access business training and providing local traders with cash transfers so they could replenish stocks. Mercy Corps paired this intervention with household-level cash transfers so that communities in conflict areas could meet their needs. In Northern Uganda, where there are now large numbers of South Sudanese refugees, safe movement isn’t the issue; the problem is that markets in the area are very thin, and they can’t support the sudden population growth. So, we’ve been trying to crowd in the private sector by helping local agro-dealers to build agent networks, working with partners to provide loan guarantees to large input suppliers, supporting advertised discounts to refugee and host farmers, and facilitating connections between parts of the supply chain that haven’t been talking to each other, such as produce buyers in the capital city with traders in more remote areas hosting refugees. Often, the key isn’t just to find who is working in a particular area, but who plausibly could do so, and help address the barriers they face so that they can enter the market. 

 Perspectives: What can practitioners do to increase access to and uptake of nutritious food, especially where the cheapest and most available staple foods are not the most nutritious?

DE: In some cases, as with Syrian refugees in Turkey, the local diet is quite diverse, and people can go to a store and use cash or vouchers to purchase foods they’re used to, including fresh vegetables and dairy products. However, in a place like Niger, research has shown that people tend to use a cash transfer to buy more grains rather than diversifying their diet with more nutritious food. In those cases, we’ve done behavior change communication about nutritious foods, and how they can be prepared. The structure of transfers also matters—sometimes, cash transfers are provided only once a month, so people are less likely to spend it on perishables. We’re now looking at how the size and frequency of transfers can change choices and we sometimes integrate household gardening along with behavior change communication into our food assistance programs so that people can take advantage of more nutritious options. 

Perspectives: Emergency food assistance and the long-term promotion of food security often look very different, and short-term approaches may be counterproductive in the long run. How can the international aid system better manage the transition from emergency response to long-term development? 

DE:   Our guiding principle here needs to be ensuring that we help people manage adversity and meet their current needs in ways that do not sacrifice and in fact further their future potential.  For organizations like Mercy Corps, this is embodied in our resilience framework. In practice, it means pushing the envelope on program design, for instance by supporting markets, strengthening social connections and building peace even in humanitarian settings. Humanitarian organizations also are starting to focus more on multi-year programming that incorporates more than household transfers and focuses as well on systems and institutional strengthening.  Mark Lowcock, the Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator,at the UN Office for the Coordination of Humanitarian Assistance (OCHA) said recently, “people in protracted conflicts are getting one year of aid 15 times, not 15 years of aid”.  More and more organizations are realizing that conflicts that have lasted a decade or more are unlikely to end soon and are starting to think differently about what is needed to help households and communities not only survive but thrive. One thing donors can do is to continue to allow for more flexibility and adaptation of approaches. Contexts can change quickly, and the process of making changes to an award so you can respond can be problematic. It would be helpful for donors to blend their financing or authorize a wider range of response options within a single award so that humanitarian organizations can shift away from direct relief as soon as possible and experiment with approaches that facilitate more rapid recovery, and similarly, be allowed to shift more towards relief should shocks require development programs to pivot to address a crisis.  

 Perspectives: How do you balance helping people achieve food security in conflict-affected settings with peacebuilding? 

DE: If we want to address extreme poverty, we have to figure out how to address protracted conflicts since well over half the extreme poor in the world will be living in conflict affected areas by 2030, according to the World Bank. We do want to be careful to keep the focus on generating the political will to end conflicts, rather than figuring out how to make it possible for people to live inthem. That said, we are looking intentionally at ensuring that where we are doing food security work, we are looking also at ways to help mitigate and manage ongoing and future tensions.  An example of this is our work to identify and serve vulnerable households in host communities as well as Syrian refugees in Jordan, an effort to reduce the potential for tensions between the two. Another example is our work to establish peace committees that facilitate community dialogue between farmers and herders in Nigeria when farmer fields are damaged by livestock grazing.  At the same time, we are asking if our food security work has the potential to not only mitigate or manage conflict but actually address some of the root causes of it.  If we can help rehabilitate traditional grazing areas, for example, which in turn reduces competition over scarce natural resources, we will go a long way to mitigating future conflicts.  This is also a focus of our work.       

It’s also important that we continuously analyze how the conflict is changing and how we need to respond to it, and both donors and humanitarians need to accept that we should invest in that analysis without having to label it “peacebuilding,” “emergency response,” or “development.” 

Many thanks to Dina Esposito and her team at Mercy Corps for sharing their work with us, and to the International Development program for hosting a wonderful event! To read about other Development Roundtable events, click here.

PHOTO CREDIT: Dèsirèe Tonus from Flickr Creative Commons, licensed under CC BY 2.0.