The Malawi threshold program targeted the policy areas measured by two MCC eligibility indicators, Control of Corruption and Fiscal Policy.
When Malawi was selected as eligible for the Threshold Program in 2004, it did not meet MCC’s Compact eligibility criteria in the Ruling Justly category, failing only the Control of Corruption indicator. While Malawi did meet MCC’s Compact eligibility criteria in the Economic Freedom category, it did not pass two indicators – Credit Rating and Fiscal Policy. The Government of Malawi (GOM) proposed a threshold program focusing on reducing public corruption with emphasis on improving fiscal management.
The Malawi threshold program was comprised of four components designed to be a multi-pronged approach to fighting corruption by reducing opportunities for corruption and strengthen the GOM’s ability to manage and monitor its finances.
Malawi Threshold Program Implementation
The Malawi threshold program agreement was signed in September 2005; the program officially concluded in September 2008. As the program administer, USAID managed day-to-day program operations and oversaw the program implementers: Casals & Associates, State University of New York, the United States Treasury Office of Technical Assistance (OTA), the United States Department of Justice International Investigative Training Assistance Program (ICITAP) and the Department of Justice Office of Overseas Prosecutorial Development Assistance and Training (OPDAT). The Threshold Program worked with over 12 separate government entities, the Malawi National Assembly, and a wide range of civil society organizations, universities, and local media.
The Malawi threshold program was largely implemented as planned and the majority of outputs were met. The threshold program established a large number of institutions (or institutional arrangements) that have proved sustainable thus far. The threshold program was also instrumental in passage of two pieces of legislation: the Anti-Money-Laundering law and the plea bargaining provisions under the recently-enacted Criminal Procedure and Evidence Code.
Malawi moved on to sign an MCC compact in April 2011. MCC placed the compact on operational hold in July 2011 due to concerns about governance in Malawi and formally suspended the compact following a pattern of actions by the Government of Malawi that was inconsistent with the democratic governance criteria that MCC uses to select its compact partners. MCC’s Board of Directors reinstated the compact in June 2012. MCC and the Government of Malawi are now working to prepare for the compact’s entry into force.