Updated September 10, 2019
U.S. Trade and Development Agency (TDA)
The U.S. Trade and Development Agency (TDA) is an
independent U.S. government export promotion and foreign
assistance agency. TDA aims to support U.S. jobs by
linking U.S. firms to export opportunities for development
projects in developing and middle-income countries
through funding “pre-export” assistance. TDA is authorized
permanently under the Foreign Assistance Act of 1961
(FAA), as amended (22 U.S.C. §2421), and operates under
the Secretary of State’s policy guidance. In 1992, Congress
established TDA as an independent agency (P.L. 102-549),
but its predecessor dates to the 1980s. The TDA Director is
appointed by the President, by and with the Senate’s advice
and consent. President Trump’s continued request for
funding to eliminate TDA, as well as other legislative and
policy developments, may intensify debate over the
arguments for and against TDA, its role in supporting U.S.
exports, and its relationship to other federal agencies.
Funding. TDA is small relative to other U.S. export
promotion and foreign assistance agencies. President
Trump’s FY2020 budget requests funding to implement an
“orderly closeout” of TDA; the Administration’s view is
that the private sector is better suited to serve TDA’s
mission, and that other federal agencies can continue to
support U.S. exports, U.S. businesses overseas, and
international infrastructure development. Congress did not
implement similar requests by the President in FY2018 and
FY2019 to eliminate TDA, instead funding TDA’s
continued operations (see Table 1).
Table 1. TDA Funding ($ millions) and Employment
Source: CRS, based on appropriations laws and budget documents.
Notes: (a) Requested. (b) FTEs: Full-time equivalents. (c) Estimated.
Programs. TDA provides grants to foreign project sponsors
(public or private entities that can make decisions and
implement projects), who select U.S. firms (primarily
smaller firms) to perform TDA-funded project preparation
activities. TDA activities include (with examples of
Feasibility studies that assess technical, financial, legal,
environmental, and other aspects of infrastructure
development projects that may lead to follow-on
business, to assist projects in securing financing and
achieving implementation (such as feasibility studies for
renewable energy projects in sub-Saharan Africa); also,
in some cases, pilot projects to demonstrate U.S.
sellers’ goods, services, and technologies in the foreign
buyer’s setting, for testing and scaling up in order to
secure project funding.
Technical assistance to support legal and regulatory
reform, the establishment of industry standards, and
infrastructure-planning activities, to enhance the
business environment for U.S. exports (such as for
aviation-related projects in China and India, and a
cybersecurity project for the Brazilian energy sector).
Training programs for foreign decision-makers on
technology, regulatory requirements, or other areas to
support U.S. exports (such as partnering with Japan’s
Ministry of Economy, Trade, and Industry (METI) to
train decision-makers in the Indo-Pacific on sustainable
gas infrastructure procurement best practices).
Reverse trade missions (RTMs) to bring foreign
delegations to the United States to meet with U.S. firms
and observe the design, manufacture and operation of
U.S. goods and services, to foster commercial ties (such
as a health care RTM for a Chinese delegation and a
ports development RTM for an Egyptian delegation).
Conferences and workshops to connect U.S. firms
with foreign project sponsors (such as hosting the
Association of Southeast Asian Nations (ASEAN)
Connectivity Through Rail Forum (Jakarta, Indonesia)
to connect project sponsors with U.S. providers of
technologies and services to advance ASEAN’s rail
infrastructure development goals).
TDA partners with public and private groups, domestic and
overseas, to advance certain initiatives through its programs.
Global Procurement Initiative: Training and other assistance
for procurement officials on best practices and policies to
calculate the total costs for infrastructure projects.
U.S. Gas Infrastructure Exports Initiative: Feasibility studies,
RTMs, and other support to connect U.S. companies with
infrastructure export opportunities across the gas value chain in
Making Global Local: RTMs, conferences, and other support to
expand TDA outreach to U.S. businesses, especially smaller firms.
TDA participates in the Trade Promotion Coordination
Committee (TPCC), an interagency body that coordinates
U.S. government export promotion efforts. Some projects
that use TDA-funded services may use financing from the
Export-Import Bank (Ex-Im Bank) for exporting. For
example, in 2018, TDA provided a grant to Ghana’s
Ministry of Energy for a feasibility study to expand energy
access through solar-based, independent “minigrid” energy
systems, with the aim to use Ex-Im Bank financing to
implement the minigrids. TDA also collaborates with other
agencies, such as the U.S. Agency for International
Development (USAID), on Administration initiatives.
U.S. Trade and Development Agency (TDA)
Requirements. The FAA directs TDA to promote U.S.
private sector participation in developing and middleincome countries and to give special emphasis to economic
sectors with notable U.S. export potential, e.g., energy,
transportation, telecommunications, and the environment.
The FAA also instructs TDA to, as much as possible,
require firms and other entities to share the costs of TDAfunded project planning and to reimburse TDA for its
expenditures if project implementation is successful.
Activity. TDA targets its support in projects that it has
determined offer solid prospects for success, U.S. export
growth opportunity, and strong development benefits. TDA
prioritizes projects where its support could sway an
opportunity in favor of a U.S. firm against a foreign
competitor or help a key project reach final stages. In
FY2018, TDA obligated about $58 million for program
activities (see Figure 2), down from $70 million in FY2017
and comparable to the $59 million it obligated in FY2016.
Figure 1. TDA FY2018 Value of Obligations
measure the impact of its program activity on supporting
U.S. exports. For the most recent ten-year period, TDA
reported a record-high export multiplier of $104 in U.S.
exports for each dollar of TDA programming.
TDA monitors and evaluates its activities to determine their
effectiveness, inform funding decisions, and support
oversight and accountability. The TDA Office of Program
Monitoring and Evaluation tracks projects after TDAfunded activities are completed to analyze the link between
funding and project outcomes. TDA employs outside
contractors for some project evaluation.
Issues for Congress
Rationales for and Against TDA. Supporters of TDA,
including many in the business community, hold that TDA
programs are key to U.S. export promotions and help U.S.
firms compete with foreign firms that have access to similar
support through their national programs. TDA’s role may
be especially critical for smaller firms with insufficient
resources to conduct their own project preparation analyses.
Supporters also note that users share the costs of TDAfunded activity and that some TDA costs are reimbursed.
Critics argue that TDA distorts market conditions by
encouraging commercially unviable activities and, in turn,
inefficient use of resources. Critics also contend that TDA
activities may provide unnecessary assistance to businesses
at the expense of taxpayers.
Effectiveness and Efficiency. The effectiveness and
efficiency of TDA may be a key issue in any debate over
potential reorganization of certain federal agencies, a
continued priority of the Trump Administration. TDA
supporters highlight the agency’s export multiplier as an
indication of its effectiveness and efficiency, and argue that
TDA would be more effective with a larger budget. Critics
question TDA’s impact on U.S. foreign policy and export
promotion goals, including whether exports estimated by
TDA would have taken place in TDA’s absence.
Source: TDA FY2018 annual report with TDA-based categories.
Impact, monitoring and evaluation. According to TDA,
in FY2018, it supported $4.9 billion in new U.S. exports
and 28,000 U.S. jobs. TDA uses an “export multiplier” to
Relation to other agencies. Supporters maintain that
TDA’s dual focus on export promotion and international
development sets it apart from other federal government
agencies such as Ex-Im Bank and USAID, as well as its
role in assisting businesses at early stages of international
transactions. Critics assert that TDA functions overlap with
those of other U.S. export promotion and foreign aid
agencies. With the expected operationalization of the new
Development Finance Corporation (DFC) in 2019 under the
Better Utilization of Investments Leading to Development
Act of 2018 (BUILD Act, P.L. 115-254), Congress may
examine how TDA and DFC relate, given that DFC is also
to have some similar tools, such as authority to conduct
feasibility studies, tailored to development finance aims.
Other stakeholders may call for enhanced interagency
coordination, such as through the TPCC. Such issues raise
questions about the policy goals and desired outcomes for
any potential change to TDA’s organizational structure.
Shayerah Ilias Akhtar, Specialist in International Trade
U.S. Trade and Development Agency (TDA)
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