August 15, 2013
Promoting Global Trade
MCC’s mission is to reduce poverty through economic growth. To that end, MCC has invested nearly two-thirds of its portfolio—more than $5 billion—in increasing global trade. MCC investments support policy and institutional reforms that remove barriers to trade and build institutional capacity. MCC programs also develop value chains, entrepreneurship and business skills, and infrastructure necessary to enable trade and private sector growth.
MCC strives to unlock new opportunities for growth that generate increased trade for the private sector. Firms benefit from pro-growth policy reforms and infrastructure projects that open new commercial, trade and investment opportunities.
Increasing Private Investment: An MCC Priority
MCC works in partnership with well-governed developing countries to tackle the most critical obstacles to private investment and economic growth. While each country’s grant program is different, many MCC partner countries place a high priority on increasing their competiveness and facilitating domestic commerce as well as regional and international trade.
|Country||Total compact amount||Support of global trade (in U.S. millions of dollars) as of FY13 Q2||Percent of total compact funds|
|Cape Verde II||66.2||17.3||26%|
|TOTAL ($ million)||8177||5675.1||69%|
|* Numbers in this table are actual as of FY 2013 Q2 and include deobligations where applicable.|
Global Trade in MCC Programs
In Benin, inefficient operations and aging infrastructure at the Port of Cotonou, a major conduit for trade with Nigeria, Niger and Burkina Faso, resulted in delays and raised costs. MCC’s $189 million Access to Markets Project was designed to improve port performance and security, expand capacity, and reduce costs. The project also included institutional reforms like improving port security, resulting in a safer, more secure environment for goods and port workers. Other reforms contributed to reducing ship waiting time at anchor, waiting time at berth, and customs clearance times. The expansion and modernization of the port is expected to reduce delays and increase the volume of imports and exports.
In Georgia, MCC provided $46 million to fund critical repairs to the North-South Gas Pipeline, an important link in the Eurasian gas trade that provides natural gas to homes and businesses throughout the country. The completed rehabilitation of Georgia’s main trunk gas pipeline is expected to reduce catastrophic loss and improve regional and municipal service delivery, providing increased reliability and energy security throughout the country.
In Honduras, El Salvador, and Nicaragua, MCC provided $448 million for rehabilitation of major overland regional highways linking together the three countries and providing important infrastructure improvements for Central America. In Honduras, MCC rehabilitated 610 kilometers of roads, including sections of the CA-5 highway, as well as secondary and rural roads to link farmers to markets. In El Salvador, MCC rehabilitated 219 kilometers of the northern transnational highway, which links El Salvador to Guatemala and Honduras. In Nicaragua, MCC funded the rehabilitation of 74 kilometers of roads, including important transport routes to Honduras.
In Tanzania, the MCC compact includes a $372 million transportation project designed to increase commerce and connect communities with markets and social resources. The project includes rehabilitation of up to 430 kilometers of trunk roads, connecting the seaport of Tanga with Horohoro at the Kenyan border and improving roads along the Mtwara corridor. The compact is also upgrading the Mafia Island airport, roads on Pemba Island, and providing funds to enhance Tanzania’s capacity to maintain its road network. In addition, a $208 million energy project is improving the reliability and quality of electric power to businesses and individuals, and extending electricity service to communities not currently served.