USAID’s Mandate for LGBTQI+ Inclusion in Economic Growth

ABOUT THE AUTHOR: Stephen Leonelli is the Inclusive Development Hub’s LGBTQI+ Program Analyst. Mirna Garcia, summer intern for the LGBTQI+ portfolio, contributed to this article.

Why including and empowering LGBTQI+ people are essential components of sustainable economic development

Around the world, lesbian, gay, bisexual, transgender, queer, intersex, and other people of diverse genders and sexualities (LGBTQI+) are fighting for fundamental human rights, safe and inclusive environments to thrive, and economic prosperity. USAID’s approach to inclusive economic growth programming helps to ensure that LGBTQI+ people have sustainable livelihoods and equal opportunities to participate in the economy. 

The Biden-Harris Administration has issued several policies that build on USAID’s 2014 LGBT Vision for Action. The Vision underscores USAID’s commitment to protecting the health, safety, and human rights of LGBTQI+ people around the world and emphasizes the two key principles of “do no harm” and “do nothing about them without them,” which underpin USAID’s work in this area. On January 20, 2021, the Biden Administration issued Executive Order 13988 to affirm that protections on the basis of gender identity and sexual orientation must be included in non-discrimination throughout federal goverment. Soon thereafter, the Presidential Memorandum on Advancing the Human Rights of LGBTQI+ Persons Around the World directed all agencies engaged abroad to ensure that U.S. diplomacy and foreign assistance promote and protect the human rights of LGBTQI+ persons, further underscoring the importance of LGBTQI+ inclusion for economic growth and prosperity as an integral part of foreign assistance. 

Numerous studies have illuminated the detrimental impact of stigma, discrimination, and violence against LGBTQI+ people on economic growth. Research from the Williams Institute in 2014 established that more inclusive and rights-protecting policies for LGBT people are associated with higher levels of gross domestic product (GDP) and other economic performance indicators, including capital stock and international trade. A 2014 study conducted by the World Bank also surmised that discrimination against LGBT people in India could be costing up to $32 billion a year in lost economic output. More recently, in 2019, the Williams Institute found that despite a progressive legal landscape for LGBT people in South Africa, stigma and discrimination were racking up an economic cost of about $317 million due to underemployment and other factors, alongside exorbitant costs related to health disparities and sexual violence. A similar study from Open for Business found that LGBT+ exclusion in the English-speaking Caribbean costs between $1.5 billion and  $4.2 billion per year – a range of 2.1 to 5.7 percent of its collective GDP. 

While these data make the case for the economic benefits of inclusion, we also must consider the direct impact of stigma, discrimination, and criminalization on the daily lives of LGBTQI+ people. For example, youth who are perceived to be gender non-conforming are disproporationately targeted by bullying, which impacts their ability to stay in school and achieve the same education as their peers. This in turn limits opportunities in the workforce, which are further limited by discriminatory hiring practices. Ultimately, this can force many LGBTQI+ people into the informal sector or underground economies, exposing them to more violence and worse health outcomes. For LGBTQI+ people who are gainfully employed, workplace bullying, bias, and discrimination can prevent them from fully participating in the office environment and severely impact mental health. 

During the COVID-19 pandemic, LGBTQI+ people around the world have faced a disproportionate increase in food insecurity and shelter insecurity, as demonstrated by research from OutRight Action International.

Addressing these detrimental impacts on economic growth and the diminished opportunities for LGBTQI+ people will require concerted, collective, and intentional effort. USAID’s Economic Growth Policy elevates the importance of economic growth as central to reducing poverty, as inclusive, private sector-led economic growth delivers increased incomes and domestic resources needed to further self-reliance. The Policy prioritizes the inclusion of marginalized people and ensures clear benefits for historically excluded groups in USAID programming.

The Policy also points to legal barriers and discriminatory norms women too often experience, which limit their participation in the economy. Lesbian, bisexual, transgender, and queer women and the entire LGBTQI+ community are similarly impacted by laws that criminalize consensual same-sex relations between adults and other vague “morality” laws which are used to criminalize gender non-conforming people. Further, exclusion from families and other social networks result in less access to finance, markets, and property for LGBTQI+ people than heterosexual men. For this reason, all economic growth programs and policies must consider gender barriers and inequalities, inclusive of LGBTQI+ people. USAID encourages innovative investment models in women-led and LGBTQI-led ventures and corporate policies that advance inclusion in the workplace.

One of the most-effective routes to policy reform, as identified by USAID’s Economic Growth Policy, is to build the capacity of civil society to act as effective advocates for locally led change. USAID forms direct relationships with myriad organizations to ensure that economic interventions draw from, and ultimately address, local constraints and meet the needs specific to local conditions. Partnerships between LGBTQI+ local organizations and professional associations, chambers of commerce, and other groups are key to sustainable economic growth. 

To this end, USAID partnered with the National LGBT Chamber of Commerce to support five LGBTI chambers of commerce and business networks around the world. These chambers have not only provided essential support to LGBTQI+ business owners and small enterprises, but also have built the capacity of activists to engage with corporations to increase supplier diversity.

This critical work demands a continued, collective focus on protecting and advancing LGBTQI+ inclusive economic growth around the world. USAID is committed to ensuring that all people, no matter who they are or who they love, are equally empowered to secure better lives for themselves and their families. 

Join MarketLinks for a Webinar on this topic on Wednesday, August 25, 2021 at 8:00 am EDT - Overcoming Barriers to LGBTQI+ Market Participation:  Innovative Programs for Economic Empowerment and Inclusive Growth. Register here.