19 May 2009
Obama Seeks $1.42 Billion for Millennium Aid Agency in 2010
Recognizes MCC efforts to help countries fight corruption
Washington — President Obama is asking Congress for $1.42 billion to fund the Millennium Challenge Corporation for the fiscal year beginning October 1, an increase of 63 percent over the current year’s funding.
The request shows that the administration supports MCC’s focus on anti-corruption in tackling global poverty, Alicia Phillips Mandaville, a senior policy associate at the MCC, said from Washington in a May 19 America.gov webchat.
MCC recently adopted a tougher policy for rating low-income and low-middle-income countries on how well they have adopted policies to prevent, detect and remediate corruption. It uses governance indicators developed by the World Bank, data gathered though surveys of businesses and individuals about experiences with government corruption in their countries, and information from anti-corruption experts, Mandaville said.
Since 2005, MCC has spent about $250 million through its “threshold program” supporting anti-corruption efforts in 14 countries in Africa, Asia and Latin America. Threshold assistance helps countries that are close to being eligible for MCC’s larger-scale programs meet good-governance criteria.
The government of Zambia, for instance, used MCC threshold funding to identify ways to reduce corruption in customs offices — an improvement intended especially to benefit people moving goods across the country’s borders, Mandaville said.
Paraguay used MCC threshold funding to reduce corruption among civil servants, improving citizens’ ability to comply with regulations for transactions such as registering a marriage or business, she said.
MCC also determines eligibility for aid using tough standards for rating how well a country has adopted economic-growth, environmental-protection and gender-equality policies, Mandaville said.
MCC is based in Washington and MCC-funded projects are managed by recipient countries through in-country Millennium Challenge Account offices. MCC coordinates its aid grants with the U.S. Agency for International Development (USAID), which provides technical expertise. MCC is headed by a chief executive officer appointed by the president and confirmed by the Senate. A board of directors chaired by the secretary of state determines which countries MCC will work with and what projects will be funded.
Questions for Mandaville in the webchat were from America.gov users throughout the world. In response to one participant’s question, Mandaville said incentives are more effective than sanctions or other “punishment” in helping countries to focus on improving in specific policy areas.
Also on May 19, the MCC board voted to authorize the termination of MCC’s $110 million, five-year poverty reduction grant agreement with Madagascar. The grant program has been on hold since the country experienced an undemocratic change of government earlier in 2009.
In a press release, MCC said that MCA-Madagascar will remain in operation long enough to ensure that the termination is orderly and does not endanger public health and safety or the environment. MCC is working to ensure that program assets, paid for with U.S. taxpayer funds, “are properly accounted for as part of this process,” MCC said.
See also “E-government Strengthens Transparency in Cape Verde.”
