Posted on June 12, 2011 by Daniel W. Yohannes, Chief Executive Officer
Earlier this year, President Obama made clear in his State of the Union address that his focus is on winning the future – getting our economy going after the worst recession since the Great Depression, while laying the foundation for long-term economic growth and job creation.
Some might wonder how an international development agency like the Millennium Challenge Corporation (MCC) fits into this vision. America has always been a generous nation, and our moral leadership is reflected in MCC’s goal of reducing poverty through economic growth in developing countries. But MCC’s investments not only benefit poor people overseas, they are critically important to our future prosperity here at home.
That fact is illustrated in Tanzania where MCC investments are both helping to reduce poverty and providing opportunities for American companies. In 2008, MCC signed a $698 million compact with Tanzania. Two American companies, Symbion Power and Pike Electric, were awarded -- after an open, competitive bidding process -- contracts to build more than 20 power sub-stations and install approximately 1,000 miles of power lines in Tanzania, which will provide electricity to over 330 communities previously without power.
This weekend Secretary of State Hillary Clinton and I are visiting with these American entrepreneurs, who have used MCC-funded contracts as an opportunity to enter a new market and make their own investment in Tanzania.
While still one of the poorest countries in the world, with a gross national income of approximately $500 per capita, Tanzania is among a group of relatively well-governed African nations that are moving in the right direction. Real GDP growth has been 6 percent or higher in Tanzania in every year over the last decade – even in the midst of the global financial crisis.
In short, Tanzania is a next-generation emerging market that is a smart place to invest for American companies with an eye on the long term.
That is exactly the thinking of Symbion Power, which has just purchased a 112-megawatt power plant in Tanzania that it plans to modify and expand. Secretary Clinton and I are touring the plant with Symbion Power CEO Paul Hinks, and we are excited about this new venture and its potential to improve electrical service in Tanzania and provide an American company with a stronger foothold in Africa.
In this increasingly globalized economy, we need innovative companies like Symbion and Pike to aggressively pursue opportunities in fast-growing African markets. Their investments will help reduce poverty in Tanzania, but will also support jobs and economic growth in the United States. And the ties they forge will encourage Tanzania to look to America as a trading partner.
That is why MCC is excited to be partnering with companies like Symbion and Pike. As the progress we are making here shows, smart investment in the developing world and close partnership with the private sector can allow us to improve the lives of those who live in poverty even as we build a stronger America for our children and grandchildren.
Posted on June 9, 2011 by Bruce Kay , MCC Director for Threshold Programs
The Millennium Challenge Corporation’s (MCC) second (Stage II) threshold program in Paraguay received international recognition last month at the Brussels meeting of the World Customs Organization (WCO). Specifically, Paraguay’s web-based system for imports (referred to by its Spanish acronym, VUI), which was implemented at the Paraguayan Customs Office with support from MCC’s Threshold Program, was recognized and praised in front of 200 country delegates.
This web-based system was designed, developed and implemented in approximately six months, record time for a process that has taken some countries years to develop, and with less success. This state-of-the–art, innovative technology will increase coordination across government agencies and departments; while five institutions currently participate, the goal is to link all nineteen institutions involved in the importation process to the VUI system, thus providing a high degree of efficiency to the system. The short design and implementation phase, and the proactive approach with participating institutions, reflects the high degree of political commitment on the part of the Government of Paraguay, particularly the Customs Director, to this endeavor.
At the meeting in Brussels, representatives from Paraguay shared their practical experiences and lessons learned in securing and sustaining the political and administrative will that is required to implement the VUI. The VUI was developed as part of the Threshold Program’s customs component, which aims to strengthen the capacity of the customs office in order to reduce tax evasion and corruption. Since the government launched the VUI in July 2010, the cost and time required to process import permits from government institutions has been reduced, improving competiveness and transparency in customs operations.
Erich Kieck, the Director of the Capacity Building Directorate at the WCO said, “Paraguay stood out at the conference as an administration that took advantage of the assistance of the MCC. They followed through and implemented the international trade single window, despite many challenges. By overcoming these challenges, gaining political support and effectively using their resources, this administration demonstrated how important perseverance can be in reaching a goal. This achievement will result in gains for the Paraguayan government and economy and demonstrates how to move from ideas to actions.”
Paraguay’s Stage II Threshold Program began in 2009 and will complete all activities in April 2012. The United States Agency for International Development (USAID) is responsible for administering Paraguay’s Threshold Program on MCC’s behalf. Watch this video to see how MCC and the Government of Paraguay are fighting corruption.
Posted on June 2, 2011 by Melvin F. Williams, Vice President, General Counsel and Corporate Secretary
The Millennium Challenge Corporation (MCC) uses 17 independent, transparent indicators to measure countries’ commitment to democratic governance, investments in people, and economic freedom. One of those indicators measures performance on the rule of law, which among other things, measures the effectiveness, independence and predictability of the judiciary; the protection of property rights; and the enforceability of contracts. As MCC’s General Counsel, this is an area of great interest to me, so I was especially pleased to see the rule of law at work in Benin and Mali, two MCC partner countries in West Africa.
I started my visit in Benin, where one part of MCC’s $307 million Compact is designed to boost investment and private sector activity by increasing access to the justice system. During my trip, I visited the new, MCC-funded Legal Information Center (LIC). When completed, the LIC will, for the first time, serve as a center for disseminating court decisions, laws, case records, and other legal information to the people of Benin, which will improve transparency and “demystify” the law for its citizens.
MCC is also financing the construction of five new courthouses, and I was fortunate enough to visit one courthouse under construction.
I also had the opportunity to see another benefit of MCC’s investment: a computerized case management system. These new courthouses and the case management system promise to enhance the rule of law by increasing the speed and efficiency with which cases are processed and adjudicated in Benin. MCC’s compact funding is already delivering results: the average time required for a trial court to reach a decision has been reduced from nine to six months -- for courts of appeal, the time has been reduced from 23 to 10 months.
I then traveled to Mali, where MCC is working with the government on a $461 million Compact that focuses on improvements to the Bamako airport, and a large, highly-integrated agriculture project in the Alatona region on the country. As part of the agriculture project, the Government of Mali is providing land titles to small famers for the first time. (Read American Investments in agricultural productivity and airport renovation lead to growth in Mali.) During my trip, I participated in a ceremony to distribute land titles to small farmers in the Village of Feto. As a measure of MCC’s efforts to improve gender equality, a number of these farmers decided to hold legal title in both the husband’s and wife’s names. A few of the titles were given to women only, which represents a major advance. Providing these farmers with ownership of their land is critical to the continued success of the agricultural project, as farmers who own their land are more likely to maintain and improve it. Moreover, as owners, they can use the land as collateral, which they could not do previously. Also, land ownership is a part of the Government of Mali’s effort to de-centralize authority. Rather than land being controlled from the capital, these land title reforms will empower the people who are actually working the land. This effort is intended to be a model for other areas in Mali.
I’m honored to have seen first-hand the impact of MCC’s investments in Benin and Mali, and how they are strengthening the rule of law.