23 May 2007

Millennium Challenge Corporation To Add Two African Partners

Partnership, accountability part of “new vocabulary” of aid, MCC chief says

Washington -- The Millennium Challenge Corporation (MCC), a U.S.-funded development aid organization, expects to sign two new funding agreements, with Mozambique and Lesotho, in the summer of 2007, according to the corporation’s chief executive officer, John J. Danilovich.

Speaking May 22 at the Africa Day Public Forum at MCC headquarters in Washington, Danilovich said a large majority of new MCC agreements, or “partnership compacts,” are likely to be in Africa. The corporation expects to commit $3 billion in grants to the continent in the next 12 months.

MCC and its African partner countries share a common purpose of “reducing poverty through growth” and improving lives “in a transformative and sustainable way,” Danilovich said.

The corporation has established contacts with 40 countries throughout the world, 19 of which are in Africa, Danilovich said. It has 11 partnership compacts under implementation -- five with the African countries of Benin, Cape Verde, Ghana, Madagascar and Mali. These five compacts total more than $1.5 billion, or half of what MCC has awarded so far, Danilovich said. (See related article.)

MCC, an independent corporation established by the U.S. government in 2004, offers grants and technical assistance to developing countries committed to good governance, investing in people and economic freedom.

The corporation determines a country’s eligibility by using 16 indicators of social, political and economic policy performance. Eligible countries are asked to submit proposals and participate in the implementation of MCC programs. (See related article.)

“Because of these expectations, we are seeing our African partners -- on their own -- enact the often difficult policy reforms necessary not just to qualify for our aid but, even more important, to do what is the best for their citizens,” Danilovich said.

He added that the MCC partnership approach, which stresses “mutual responsibility and accountability,” is well suited to address the problems of poor African countries because it raises the region’s expectations, builds capacity and delivers tangible results.

Danilovich said MCC funds a whole range of projects in all sectors of the African economy, “from pineapple farms in Ghana seeking to increase high-value crop production, to anti-corruption programs in Kenya and Zambia, to road rehabilitation projects in Cape Verde, to investing in the Bamako airport in Mali to increase its use for regional and international trade.”

Speaking at the same forum, the ambassador of Burkina Faso in Washington, Tertius Zongo, praised what he called MCC’s departure from the “business-as-usual” approach to international aid. He said partner countries value the corporation’s insistence that recipients take the initiative regarding their own development.

“Don’t forget that money cannot buy reform,” Zongo said. But aid based on partnership and accountability can “strengthen the capacity of the recipient countries to reform themselves, to be able to sustain further progress on their own,” he added.

Burkina Faso has been declared as “compact eligible” while participating, together with Kenya, Malawi, Tanzania, Uganda and Zambia, in the “threshold” program designed for countries that show significant progress but need to improve on some of the indicators. Three other African countries -- Niger, Rwanda and São Tomé and Principe -- have been declared eligible for threshold aid.

MCC threshold agreements are designed for countries that are on the threshold of meeting MCC requirements, meaning they are committed to undertaking the reforms necessary to achieve eligibility for greater compact assistance.

For more information see U.S. Aid to Africa and Trade and Economic Development.

Also visit the Millennium Challenge Corporation Web site.

(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)