HomeBriefings – Foreign Press Centers...FY2025 Budget: U.S. Global Funding Priorities

# 									FY2025 Budget: U.S. Global Funding Priorities							

FPC Briefing

Douglas Pitkin, DirectorBureau of Budget and Planning

Dr. Tracy M. Carson, DirectorOffice of Foreign Assistance

Richard R. Verma, Deputy Secretary of State  for Management and Resources

 Wednesday, March 13, 2024, 11:00 a.m. Eastern Time

Washington, D.C.

March 13, 2024

## 								Summary							

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Each year, the President presents Congress with a budget request to support domestic and foreign policy priorities laid out by the Administration. This year, the foreign policy priorities are particularly important, given the multiple crises across the globe, and other rising challenges. At this briefing, Deputy Secretary for Management and Resources Verma outlines the Biden Administration’s primary foreign funding objectives for the Department of State and underscores the importance and intricacies of the federal budget process. 
 

**THE WASHINGTON FOREIGN PRESS CENTER, WASHINGTON, D.C.**

**MODERATOR:**  Good morning and welcome to the Washington Foreign Press Center.  My name is Leah Knobel and I am the moderator for today’s briefing.  Today it is my pleasure to introduce Deputy Secretary of State for Management and Resources Richard Verma.  Today, Deputy Secretary Verma will outline the Biden administration’s primary foreign funding objective for the Department of State and underscore the intricacies of the federal budget process.

We are also joined by, on my far right, Roman Napoli, deputy assistant administrator for planning, learning, and resources for USAID.  Next to him, the director of the Office of Foreign Assistance, Tracy Carson; and the director of the Bureau of Budget and Planning Douglas Pitkin.  They will participate during the Q&A portion of this briefing.

Just a reminder that this briefing is on the record and we will post a transcript and video of the briefing on our website, fpc.state.gov, later today.  For the journalists joining us on Zoom, please take a moment now to rename yourself in the chat window with your name, outlet, and country.  And I would now like to invite Deputy Secretary Verma to begin with his opening remarks.

**DEPUTY SECRETARY VERMA:**  Great.  Leah, thank you so much.  Good morning, everyone.  Thank you for being here.  Greatly appreciate it.  The budget request we sent to Congress on Monday would allow the Department of State and USAID to continue advancing the Biden administration’s vision of a free, open, secure, and prosperous world.  The President’s FY2025 budget request includes 58.8 billion for State Department and USAID.  This is a $718 million increase, or 1 percent, above Fiscal Year 2023.  We’re grateful for Congress’s partnership in resourcing the State Department and USAID to meet the many challenges that we face today.  U.S. diplomacy and development are more essential than ever to solving global challenges and to upholding universal values.

Over the past year, the United States, with our friends and allies around the world, has faced a range of significant challenges, from the conflict in the Middle East to Russia’s ongoing brutal war against Ukraine to historic levels of irregular migration and forced displacement to unprecedented and growing global humanitarian needs.  Our budget request invests in the personnel, the programs, and assistance that the State Department and USAID need as we stand at the front lines of these issues.  Allow me to outline some of our highest-priority areas in the request.

First, we must employ all the tools at our disposal to out-compete China wherever possible.  The FY25 request will allow us to continue to invest in the foundations of our strength at home, align with likeminded partners to strengthen our shared interests and address the challenges posed by PRC, and harness those assets to compete with the PRC and defend our interests.  We are aligning our foreign assistance to advance U.S. values by building a network of likeminded allies and partners both globally and with concerted focus on the Indo-Pacific as a region of vital importance to U.S. and global security and prosperity.

The $4 billion discretionary request across foreign assistance and diplomatic engagement for the Indo-Pacific Strategy represents our ironclad commitment to advancing an affirmative vision of U.S. values for the region, but the request also includes $4 billion over five years in mandatory funding, including $2 billion to create a new international infrastructure fund which will outcompete China by providing a credible, reliable alternative to PRC options while also expanding markets and opportunities for U.S. businesses.  This fund will support transformative, quality, and sustainable hard infrastructure projects.

Additionally, we are seeking $2 billion to make game changing investments in the Indo-Pacific to strengthen partner economies, to improve good governance and the rule of law, bolster connectivity between partner countries, and support their efforts – including through multilateral fora – in building resilience and pushing back against predatory efforts.

Our second key priority in this request is ensuring Russia’s war in Ukraine remains a strategic failure.  We are requesting 482 million, which would sustain crucial support for Ukraine in its resolute defense of its people and independence from Russia.  Our request also provides the resources needed to deliver critical economic development and humanitarian assistance to Ukraine’s brave and resilient citizens.  Let me be clear, though:  These funds are in addition to the October 2023 National Security Supplemental Request.  The FY2025 resources start re-establishing a base budget for core and enduring programming for Ukraine, but they cannot replace the funds requested as part of the supplemental.

Third, advancing peace and security in the Middle East remains a top priority for us, including working with our partners to end the conflict between Israel and Hamas and deliver lifesaving assistance to Palestinians.  The President’s request of 7.6 billion maintains our longstanding investments to support key partners in the Middle East and North Africa and their security against growing violence by extremist and Iran-linked malign actors.  The funds would unlock resources to partner with citizens of the region, foster economic growth, and advance good governance and respect for human rights.

Fourth, delivering solutions to shared global challenges such as irregular migration and forced displacement, countering synthetic drugs, a rapidly changing climate, and a growing humanitarian crisis around the world.  Now, to do this, we are mobilizing resources to promote economic prosperity, grow energy sectors, strengthen health systems, invest in food security, and to mitigate the impacts of the climate crisis.  Our partnerships are crucial to tackling these global challenges and ones that affect our own hemisphere, including irregular migration, forced displacement, and the illegal synthetic drug crisis in the United States.  Contributions to international and peacekeeping organizations include some $3.1 billion.  The United States multilateral contributions are indispensable to shaping international institutions and partnerships critical to our national security interests.  This includes 1.7 billion for contributions to international organizations such as the UN, WHO, NATO, and UNESCO; and 1.4 billion for contributions to UN international peacekeeping.

Fifth, we – we will continue to work to ensure U.S. interests and values are protected in the digital and emerging technology sector.  We are grateful to Congress for providing 500 million over five years to work with our partners and allies to secure and expand our critical semiconductor and supply chains and promote the adoption of trustworthy telecommunications technologies.

Success in all of these policy areas is not possible if we do not have the people, the platform, and the tools to achieve these objectives.  And so to that end, with FY25 funds we must also continue the Secretary’s ambitious agenda to modernize American diplomacy to ensure we are equipped to seize the opportunities of the 21st century.  The $6.2 billion request for diplomatic operations will strengthen the department by improving the global workforce, including our locally employed staff at our embassies overseas.  We’ve requested 5.6 billion to keep our people, our buildings, and our information around the globe safe and secure, including for an expanded presence in the Indo-Pacific, in Libya, and in the eastern Caribbean.  Finally, our request will enhance the department’s consular services for passports, visas, and services overseas.  Increased staffing and IT capacity will reduce wait times and improve customer service that many Americans and many visitors to the United States counts on.

So as you can see, this is a very comprehensive budget.  It does build upon our FY23 budget by 1 percent, as we’ve talked about.  We’re still waiting for the FY24 budget to finalize.  And of course we remain committed to our supplemental spending efforts.  I’m really grateful to the State Department team that has worked so hard to put this request together, including the leaders here from State and USAID who are really doing such incredible work to support our people, our operations, and our programs in literally every corner of the globe.  And so maybe with those opening comments, I’d be happy to take any questions here in the room or online.

**MODERATOR:**Great.  Thank you.  For those of you in the room, if you have a question, raise your hand and wait to be called on.  And please project your question and please state your name and outlet.  A reminder for journalists joining us via Zoom:  Please be sure your screen name includes your name and media outlet.  And we will take questions from journalists in the room first.

Start with Alex in the back.

**QUESTION:**  Thank you so much for doing this.  I have two questions.  One is on Azerbaijan, if I may.  Unlike last year, in your request this time, you did not include any funding for anti-terrorism and demining and related areas.  I’m just wondering whether this is related to 907.  It doesn’t say anything; there’s some ambiguity in the document about that.

And secondly, if I may, slightly different on Ukraine.  Yesterday, President sent a memorandum to the Secretary asking him to furnish up additional 126 million to Ukraine.  Is it part of the current FY23 – is it in addition to yesterday’s 300 million?  And how is it going to be allocated?  Thank you so much.

**DEPUTY SECRETARY VERMA:**Yeah, thank you for the questions. On – look, on Azerbaijan, I think you know the U.S. Government partners with Azerbaijan in a range of areas on several key topics that are a priority for both our countries.  The FY25 request includes support for inclusive economic growth and trade expansion, English language training opportunities, civil society and independent media, as well as organizations defending human rights and opportunities for regional dialogues and confidence-building measures.  I think the request comes in around $12.5 million in bilateral assistance; that’s down slightly from last year.  Any additional statutory obligations that we have, that we have to certify to Congress, those continue.  And so I guess I’d view that – view the request separately from 907, as you referenced it.

On the Ukraine, the PDA announcement yesterday, grateful to our colleagues at DOD and across the interagency for making that possible.  Of course, you’ve seen what we have in the supplemental request, and you’ve now heard what we have in FY25 for Ukraine.  The 300 million, whether it was part of FY23 or not, I would differ to Tracy, who will have a little bit more detail on that.  Yeah.

**MS CARSON:**  Yeah.  For the assistance that was announced, it’s really what we’re doing ongoing right now.  And what we are sort of focused here, the 482 million, is sort of what we’re thinking about our needs to be two years – or as we plan for the future out for Fiscal Year 2025.

**QUESTION:**  (Inaudible) which president is asking the Secretary to allocate 126 million.  I’m just curious if it is part of the 300 million from the supplemental, or where is it coming from?

**MS CARSON:**  We’ll take the question back to make sure we get the specifics.

**QUESTION:**  Thank you.  Robert Delaney with South China Morning Post.  Just a question about COFA funds for Marshall Islands, Micronesia, and Palau.  We saw that the funding finally passed Congress this week, but given that we’re hearing – increasingly we’re hearing criticism from many of these Pacific Island nations that a lot of the funding is really getting caught up in the geostrategic competition with China.  What can we expect in terms of non-COFA investments in ports that are not necessarily tied to military operations – roads and other projects that could be related to sustainable development?  You mentioned the infrastructure fund in your opening remarks, but could we get some more details on that?

**DEPUTY SECRETARY VERMA:**  Sure, happy to break that out for you.  And I’m – I’ve been really proud of the assistance and the commitment that we’ve made to the Pacific Islands, and each one of these relationships really does stand on its own.  Had the good pleasure of being in Fiji recently, where we’ve increased our USAID presence there substantially.  We have opened up new embassies across the Indo-Pacific, and our level of commitment to the region – again, Tracy, feel free, and Doug, you can feel free to jump up here and talk about both our aid and our operational presence.

**MS CARSON:**  I’ll point to two places in the foreign assistance budget.  First, you’ll see there’s roughly about $100 million in what we’re doing with both regional programming and bilaterally for a number of our partners in the Pacific Islands.  It essentially doubles the level of programming that we’ve been doing relative to Fiscal Year ’23.  And then to what you referenced, the Partnership for Growth and Infrastructure Investment, is really a fund of $250 million, focused globally, but on taking opportunities to really help with technical assistance and capacity-building with regard to infrastructure for our partners in the Pacific Islands, but globally as well.  And those are the two places I’d point to.

**MR PITKIN:**  And in terms of implementing these programs, our Bureau of East Asia and Pacific Affairs has the lead.  And so for the third or fourth year in a row, we propose a fairly robust increase in EAP Bureau operations and staffing.  We’ve certainly mentioned the new embassies we’ve opened up in Vanuatu and in Tuva.  And in this request we propose resources to facilitate opening some type of presence in Kiribati, subject to the internal process and consultation with Congress, but also staffing across the region, because in many cases the support and policy and other economic programs will be managed across a regional platform.  So EAP will continue to grow its capacity to help facilitate this across the whole interagency.

**QUESTION:**  Could I just ask a follow-up on the possibility of an embassy Kiribati?  Where does that stand?

**MR PITKIN:**  We have requested resources in the budget to enable that as part of the request for EAP.  And then our Bureau of Diplomatic Security, our bureau of embassy construction, OBO, will then have the actual specifics.  But we have yet to develop a specific proposal, but we actually are planning for it in the months ahead.  But nothing has been formally transmitted to Congress, and that’s the first step, is consulting with Congress on the specifics of our plan, and that is still in the works.

**DEPUTY SECRETARY VERMA**:  I’d also say it’s – again, just given my recent travel out to the region, there’s a whole set of activities going on.  I was able to travel with our director – our Ambassador for Cyber Security Nate Fick, and the amount that’s happening just in the technology cooperation and ensuring there are trusted networks and trusted providers for secure communications and advanced kind of 5G networks in the Pacific Islands is also very significant.

Also was so grateful to our USAID colleagues for really increasing their presence across the region and doing work in every element – from health to economic development to training.  So there’s a lot happening.  We are so grateful that the COFA compact was finally gotten through.  And that now gets us across that hump, but back to some regular and deepening cooperation with our Pacific Island partners.

**MODERATOR:**  In front here.

**QUESTION:**  Thank you.  Diyar Kurda with Rudaw Media Network.  I have two questions on Iraq.  When – about the war security protection, what we mentioned – what you mentioned in your report that there’s a slightly increase in that numbers.  Why there’s an increase in this comprehensive (inaudible)?  And also, you were the largest funder for the Iraqi Kurdistan, where (inaudible) one million refugees and IDPs, so do you have any breakdown from that – from the (inaudible) Iraq, to the Kurdistan region of Iraq?

**DEPUTY SECRETARY VERMA:**  Yeah.  I’m going to ask both Doug and Tracy to jump in.  I’ll just say the WSP number is really our Diplomatic Security presence, and we are in more places with more challenges.  And so it would only make sense that that number continues to increase a little bit, as the responsibilities increase and as our global footprint also increases.

**MR PITKIN:**  There’s, I think, two elements.  One is just the normal contract growth because we rely, of course, on a range of contract vehicles to support our presence, and so we’re seeing, in this market, particularly for DS, a global pattern.  In fact, our request for DS specifically is about a 4 or 5 percent increase, so a higher rate of growth for that part of our responsibilities and others.

And particularly, of course, we’re also expecting the consulate in Erbil to be fully operational.  We know that, of course, there were some slight delays in the completion.  But by ‘25, we expect it to be fully operational, and so DS will take on a larger share of security operations in Erbil by the end of this period.

**MS CARSON:**  And then foreign assistance, I’d point to two places.  If you look at the Iraq bilateral budget, it’s roughly about $285 million.  And there’s two areas of focus.  There are economic assistance with support to the financial sector, energy security, and a range of programing, as well as our military assistance.

To your point on humanitarian assistance, typically we request this globally.  So you’ll see a request of $10.3 billion, which we use in the year that the funds are available to respond to a range of crises in the Middle East and beyond.  And so that’s the source of resources that we use for our humanitarian response.

**QUESTION:**  You mentioned about your new facility, U.S. consulate in Erbil.  Will there be an increase of the staff, diplomatic staff, in Irbil when this facility completed by the end of this year?

**DEPUTY SECRETARY VERMA:**  Yeah.  So it’s a great question.  I mean, I was just out there.  So I do actually work in Washington periodically but – (laughter) – most of the time.   And it was a – really a very inspiring visit to Erbil, not only to meet with our people but to meet with senior government officials as well, and very impressed with our level of commitment with the facility there.

Doug, I don’t know if the actual numbers will tick up, but it is one of – it will be one of our most significant presences in that part of the world, and it will be a very kind of full-service capability there.

**MR PITKIN:**  There’s no specific increase, but because of the reduced pace of operations because of the situation in the region, we may expect the staffing to gradually grow, but not estimating the growth, but it’s designed to accommodate more staff.  But we can expect that, but not a dramatic growth.

**MODERATOR:**  Okay.  Seeing no other questions in the room, we’ll go to Farrah on Zoom.  If you could please turn on your —

**QUESTION:**  Hello.  Can you hear me?

**MODERATOR:**  Yes, we can hear you.

**QUESTION:**  Thank you.  Thanks very much for doing this.  Look, one year ago tomorrow, actually, President Joe Biden, our Australian Prime Minister Anthony Albanese, and British Prime Minister Rishi Sunak got together in San Diego to unveil AUKUS, which as you all know is the big plan to help Australia acquire a fleet of nuclear-powered submarines to safeguard the Indo-Pacific amid the threat of China.

However, the latest budge reveals that you’re only seeking funding for one Virginia-class submarine to be built in the coming year, and that’s well below the production rate of 2.33 subs a year that the U.S. has told us is necessary to sell any submarines to Australia.  This has obviously raised concerns both from the Hill among some congressmen I’ve spoken to, and also among Australia and other allies, about America’s commitment to deliver on what was promised through AUKUS.

Can I get a sense from you, please, as to why the U.S. would propose such a funding cut of this nature, given everything you’ve said about safeguarding the Indo-Pacific?  And also, is, I guess, the broader question of does the U.S. remain wholly committed to the AUKUS pact and does it remain a reliable partner to deliver on it among its allies?

**DEPUTY SECRETARY VERMA:**  Thank you for the question.  I was just in Australia as well, and I can tell you that AUKUS is one of the transformative agreements.  We are very proud to be strongly supporting it, moving forward with it.  I think the budget reflects kind of the pace and scope and scale that all sides have agreed to.  I saw only a – incredible enthusiasm and commitment from our State Department, DOD, the larger technology community – because as you know, AUKUS doesn’t just have a – one pillar.  It has two pillars, which is also about our collaboration across the defense and technology sector.

So I actually saw quite an incredible commitment to it, a lot of enthusiasm, a lot of appreciation, and a lot of forward movement with actual operational plans.  That’s how I would answer the question.

**MODERATOR:**Okay.  This ends the Q&A portion of today’s briefing.  Deputy Secretary Verma, do you have any final remarks you’d like to share?

**DEPUTY SECRETARY VERMA:**Just thank you – thank you so much.  Thank you for giving us this opportunity to lay out some of these details.  We know it’s a challenging budget environment in the United States, but we also appreciate the great support – bipartisan support – that we have in these programs, in our operations, and in our people.  And look forward to working with colleagues to see that this gets implemented in addition to finishing out the work of FY24, and of course our incredibly important supplemental request.  Thank you.

**MODERATOR:**This concludes our briefing.  I want to give a special thanks to our briefers for sharing their time with us today and to those of you who participated.  Thank you.

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Budget ReportBureau of Budget and PlanningDeputy Secretary of State for Management and ResourcesDistrict of ColumbiaForeign Press CentersForeign Press CentersNew YorkOffice of Foreign Assistance

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