American Foundations Increase Giving to Support International Projects

By DEBRA E. BLUM

Overseas giving by American foundations is expected to increase

in coming years as thousands of grant makers try to figure out how best to distribute endowments that are swelling fast, a new report says.

The report, by the Foundation Center and the Council on Foundations — nonprofit groups in New York and Washington, respectively — examines international grant making from 1990 to 1998. It says that in 1998, foundations gave an estimated $1.6-billion to nonprofit groups abroad and to U.S.-based international programs. Adjusted for inflation, that is a 51-percent increase from 1990.

But the huge gain failed to keep pace with the rapid rise in foundation giving overall, and international gifts as a share of all foundation contributions slipped slightly, from 11.5 percent in 1990 to 10.9 percent three years ago.

The report cites reasons to believe that international giving may be on the upswing, however. Not only is the actual dollar amount going to international causes on the rise, but, the report says, the number of grant makers giving money to international causes is growing, too.

An analysis of grants of $10,000 or more by about 1,000 foundations in each of 1994 and 1998, shows a 20 percent rise in the number of foundations — to 576 — awarding international grants. And the number of international grants awarded by those foundations grew faster during the four years than the number of grants awarded to all causes combined — 39 percent versus 33 percent. Moreover, the report says, new foundations — which were created at a record pace last decade — are expected to start awarding international grants as their endowments and staff grow over time.

“Generally speaking,” the report says, “new funders give a smaller share of their grant dollars for international purposes than large, older foundations.” Thus, it says, “one of the factors that inhibited faster growth of international giving in the late 1990s will likely be a strong source of its future growth.”

Already since 1998, the report notes, at least one new grant maker, the Bill & Melinda Gates Foundation — created in Seattle in 1994 and now the world’s biggest — has substantially increased its international giving.

Such private grant makers are the primary source of international grants, accounting for 90 percent of the total amount of money for overseas programs, the report says. In 1998, the Ford Foundation, in New York, alone awarded $233-million to international programs and causes.

Western Europe Leads

But it is the other types of grant makers, corporate foundations and community foundations, that are increasing their international gifts at a faster pace. Based on the examination of 1,000 foundations in 1994 and 1998, giving by corporate foundations doubled, to $57-million, while giving by community foundations grew two-and-a-half times to $6-million.

Along with tracking where international grants are coming from, the report also examines where the grants are going. In 1998, countries in Western Europe were the leading recipients of money from American foundations sent directly overseas. In 1994, countries in Latin America were the top recipients.

From 1994 to 1998, giving in North Africa and the Middle East nearly tripled for the sample of foundations examined those years, to $24-million, while giving to Canada more than doubled, also to $24-million. Giving in Eastern Europe, where a lot of foundation money went in the early 1990s to support emerging democracies there, dropped by 49 percent from 1994 to 1998, to $27-million.

In both years, the biggest share of gifts — about 18 percent of all money for international grants — went to programs supporting development efforts. The amount spent on human-rights programs climbed the fastest from 1994 to 1998, accounting for 8 percent of all grant money in 1998, up from 5 percent four years earlier.

Copies of the report, “International Grantmaking II: An Update on U.S. Foundation Trends,” are available for $35, plus $4.50 for shipping, prepaid, from the Foundation Center, Department NA12, 79 Fifth Avenue, New York 10003-3076; (800) 424-9836, in New York: (212) 807-3690. Highlights from the report have been posted on the center’s Web site at http://fdncenter.org/grantmaker/trends/index.html.