What research from Ghana tells us about building local leadership into the next U.S. foreign-assistance system.
The institutional architecture of U.S. foreign assistance has changed dramatically. Following the dismantling of USAID, the Department of State has assumed responsibility for a substantial portfolio of development and humanitarian programs that previously sat within the Agency.
The scale of that transition is easy to underestimate.
A July 2026 evaluation by the State Department’s Office of Inspector General found that 17 State bureaus and offices had taken responsibility for 1,504 transferred foreign-assistance programs and awards, representing $51.5 billion in obligated funds and more than $86 billion in expected total costs. Department personnel reported challenges involving staffing, training, IT access, data, and award administration. Read the State OIG evaluation
Source: U.S. Department of State Office of Inspector General, July 2026.
At the same time, the development community is making the case that restructuring U.S. assistance should not mean abandoning local leadership. In a September 2 policy commentary, the Modernizing Foreign Assistance Network (MFAN) argues that local organizations, faith-based groups, and governments should remain strategic partners with both funding and decision-making authority as the next U.S. assistance model takes shape. “Centering the Moral Imperative and Local Leadership in the Next Chapter of U.S. Humanitarian Aid”
That principle is important. But experience from the previous aid system also offers a caution:
Local leadership is not an administrative shortcut.
Moving resources and decision-making closer to local institutions can make assistance more responsive, sustainable, and grounded in local realities. It can also strengthen the institutions and relationships that allow countries and communities to solve more problems themselves, helping reduce dependence on outside assistance over time. But doing it well requires a funding system capable of managing more diverse organizations, different levels of institutional maturity, smaller awards, different risks, and a much larger number of relationships.
Research LINC conducted through its work in Ghana helps illustrate why.
What Ghana taught us
In 2024, USAID/Ghana commissioned an in-depth study of Ghana’s local organization ecosystem under the LINC-implemented USAID/Ghana Monitoring, Evaluation, and Learning Platform Activity.
The resulting Ghana Localization Landscape Analysis was prepared by The Cloudburst Group, which managed a team of Ghanaian and international researchers, with Adapt Consulting LLC providing team leadership and lead writing. The study drew on 28 semi-structured interviews involving 31 people, three listening sessions, an extensive desk review, and an online survey with 217 responses.
READ THE RESEARCH: Ghana Localization Landscape Analysis (November 2024)
The study was conducted in a policy environment that no longer exists. It examined USAID’s localization definitions and targets, including the former goal of directing 25 percent of applicable funding to local partners.
There is little value in debating those targets today as if they were still policy.
There is considerable value, however, in understanding what the research revealed about the mechanics of moving funding and authority closer to local organizations—because those challenges have not disappeared with USAID.
Local funding changes the administrative math
One of the Ghana study’s simplest findings was also one of its most important.
Large international awards allow a donor to move substantial amounts of money through a relatively small number of transactions. Smaller direct awards to local organizations can require many more relationships to move the same amount of funding.
The study illustrated this using USAID/Ghana’s portfolio at the time. To move approximately $35 million directly to local organizations, an average award size of $500,000 could have required roughly 67 direct local awards. Survey evidence suggested that the realistic award size for many organizations might have been closer to $250,000—which could have pushed the number of awards above 100.
Historical Ghana illustration: more direct local funding can mean many more award relationships
Source: Ghana Localization Landscape Analysis (November 2024). Historical illustration based on the former USAID/Ghana portfolio and policy context; not a current funding target.
The exact numbers were specific to Ghana and the former USAID target. The underlying lesson is not.
A distributed funding model can require more award-management capacity, not less.
That matters enormously for State today.
The Department has inherited a greatly expanded foreign-assistance portfolio while its own Inspector General is documenting staffing, training, systems, and award-management challenges. State is making hiring efforts, but MFAN and others continue to identify substantial capacity gaps, particularly in regional bureaus and overseas missions. See MFAN’s June 2026 capacity statement
The answer should not be to abandon local leadership because it is administratively demanding.
It should be to design an operating model capable of supporting it.
Build a ladder, not a cliff
The Ghana research also showed why simply opening large competitions to local organizations does not necessarily create meaningful local leadership.
Only 33 percent of surveyed organizations had managed a USAID award. The median value of respondents’ largest award from any donor was approximately $74,000. Only 12 organizations surveyed reported managing awards above $500,000.
That did not mean Ghana lacked capable organizations.
It meant that experience managing large donor awards was highly concentrated—and experience itself depends on opportunity.
Organizations can face a catch-22: previous experience managing a large U.S. government award demonstrates that they are capable of managing one, but an organization cannot acquire that experience until somebody gives it the first opportunity.
The lesson for the next U.S. aid model is to create progressive pathways rather than a binary choice between a small subaward and a multimillion-dollar prime award.
Those pathways can take many forms: appropriately sized first awards; progressively larger responsibilities; local-prime/international-sub relationships; intermediaries that genuinely transfer capability and authority; government-to-government assistance where institutions and safeguards are appropriate; and partnerships in which smaller community organizations can remain effective community organizations rather than being expected to evolve into large government contractors.
Not every local organization needs the same destination.
A stronger system creates multiple routes to leadership.
Fund the institution, not only the activity
The Ghana study also documented a less visible constraint: local organizations incur real costs simply to participate in international assistance.
They need financial systems, audits, procurement procedures, safeguarding systems, staff, technology, registration, governance, proposal-writing capacity, reporting systems, and management time. Some respondents reported inadequate indirect-cost recovery and liquidity problems associated with pre-financing activities before milestone payments arrived.
This creates a paradox.
A local organization can win more donor-funded projects without becoming a stronger institution.
If the next U.S. assistance model expects local organizations to exercise greater responsibility while funding only project deliverables, it risks reproducing that problem.
Strong oversight and local leadership are not opposing objectives. If State wants accountable local partners, it must recognize that the systems on which accountability depends cost money.
Realistic cost recovery, appropriate periods of performance, institutional strengthening, proportionate reporting requirements, and financing structures that do not impose unreasonable cash-flow demands are therefore not concessions to local organizations.
They are part of responsible award design.
“Local” funding can still concentrate power
There is another lesson from Ghana that deserves particular attention.
Moving an award from an international organization to a nationally registered organization does not automatically move power closer to communities.
Established national NGOs are often better positioned to compete for donor funding because they already have audited systems, experienced proposal teams, donor relationships, English-language capabilities, and professional management structures.
Those are legitimate advantages.
But Ghanaian respondents also worried that a rapid increase in direct local awards could concentrate funding and skilled staff among a relatively small number of national organizations. National organizations, in turn, often depend on smaller community-based organizations for their local relationships, geographic reach, and contextual knowledge.
The research documented concerns about staff poaching and “keyman” risk as better-funded organizations recruited experienced personnel from smaller ones. It warned that localization could inadvertently shift power away from community-level actors toward national-level institutions if those effects were not considered.
That suggests that State should measure more than the legal address of an award recipient.
It should also ask who sets priorities, who controls resources, who owns relationships, who participates in decisions, where skilled staff are moving, and whether community-level organizations are becoming stronger or merely changing which intermediary they work beneath.
State does not need to recreate USAID’s localization architecture
The practical implication is not that State should recreate USAID’s old localization targets, terminology, or bureaucracy.
It has an opportunity to build something better suited to the system that exists now.
But some capabilities are difficult to replace once lost.
Award design and grants management are professional disciplines. So are evaluation, financial oversight, technical program design, political-economy analysis, systems thinking, and the cultivation of long-term relationships with local institutions. State’s Inspector General has already identified workforce capacity as a material issue in the transition. MFAN has similarly argued that State needs stronger development and humanitarian expertise and greater field-level capacity.
Four principles for the next operating model
Preserve and rebuild specialized implementation capacity.
State needs enough acquisition, assistance, technical, financial-management, and monitoring expertise to oversee the portfolio it now manages. Field-based expertise and national staff are especially important because effective oversight depends on understanding institutions and relationships on the ground. Where State does not have all of that capacity internally, U.S.-based implementing organizations—including small businesses with strong local staff and networks—can provide management and technical support while helping build local capability rather than substituting for it.
Use different funding mechanisms for different partners.
Direct local awards are one tool, not the definition of local leadership. Government partnerships, intermediaries, pooled mechanisms, local primes, international technical assistance, smaller grants, and other arrangements can all serve useful purposes when authority and accountability are clear. Well-designed collective-action approaches can also help reduce State’s direct management burden by coordinating multiple actors around shared priorities and structures, while giving community-level organizations a meaningful role and strengthening networks that can outlast a single award.
Finance institutional strength alongside implementation.
If local organizations are expected to accept greater responsibility, award structures should help them build—and retain—the systems and people required to exercise it.
Measure leadership, not merely funding flows.
Dollars matter. So do decision rights, relationships, institutional resilience, community participation, and what remains in-country after an award ends. One test of success is whether local institutions and networks are stronger and better able to act together after external funding ends.
Inherit the learning, too
USAID’s institutional structure is gone. There is no reason to pretend the next U.S. assistance system will—or should—look exactly like the old one.
But institutional change should not require institutional amnesia.
The previous system generated decades of experience about what makes international assistance difficult: managing risk without eliminating innovation, building sustainable institutions rather than temporary projects, reaching organizations outside conventional procurement networks, supporting accountability without overwhelming partners, and moving authority closer to the people most affected by development decisions.
Our Ghana research captured one small but useful part of that experience.
As State determines how to manage its greatly expanded foreign-assistance responsibilities, those lessons are worth carrying forward.
State inherited the portfolio. It should inherit the learning, too.
Further reading
- Ghana Localization Landscape Analysis (November 2024). Produced under the LINC-implemented USAID/Ghana MEL Platform and prepared by The Cloudburst Group with support from Adapt Consulting LLC.
- MFAN: “Centering the Moral Imperative and Local Leadership in the Next Chapter of U.S. Humanitarian Aid” (September 2, 2026).
- State OIG: Evaluation of Department of State Administration of Foreign Assistance Programs Transferred from USAID (July 2026).
