MCC provides forum for private sector input in compact development

Posted on February 29, 2012 by Jason Bauer, Director, Private Sector Development

Two weeks ago, Ghana successfully completed its five-year MCC compact, a $547 million program designed to improve the agriculture and transportation sectors. Over one million Ghanaians will benefit from the compact. In early 2011, the MCC Board of Directors selected Ghana as eligible to develop a new compact. As part of this compact development process, the Government of Ghana has initiated broad-based consultations with representatives from civil society and the private sector.

On January 24, 2012, MCC partnered with the Initiative for Global Development and the Corporate Council on Africa to host a forum for business firms – some already active in West Africa, some newcomers to opportunities in the region. The forum’s program was designed to help MCC and the Government of Ghana identify opportunities, obstacles, and solutions to private sector participation in Ghana’s power sector. More than 60 participants representing more than 20 companies across the power value chain participated in the day-long session.

Government of Ghana officials, including from the Ministry of Energy, spoke in an open forum about the types of private sector participation Ghana is most interested in attracting. A number of potential investors shared their views, both in group settings and individual meetings, about Ghana’s constraints to foreign investment. Participants also recommended concrete actions the Government of Ghana could take within the proposed new compact to alleviate those constraints.

This event is just one example of MCC’s efforts to enhance engagement with the private sector during program development. Feedback from attendees was encouraging; one noted that it was the first time his company, a U.S.-based energy firm, had engaged with a donor and partner government during the process of defining a proposed grant program.

Once the Government of Ghana completes the concept paper for its proposed second-generation compact, the MCC Board of Directors will review project proposals and vote on compact approval. We look forward to further engaging the private sector to incorporate its innovation, capacity building, capital and expertise to the MCC compact development process.

BCLC forum highlights private sector investments in water and sanitation for poverty reduction

Posted on February 3, 2011 by Dr. Barbara Hayes, Director

Yesterday I participated in the U.S. Business Civic Leadership Center’s “Global Corporate Citizenship Issue Series: Focus on Water”  event at the U.S. Chamber of Commerce in Washington, DC. The forum brought together representatives from the private sector, nongovernmental organizations, and government agencies to discuss opportunities for private sector investments in water and sanitation in developing countries.

Lack of safe and reliable access to clean water is a critical constraint to economic growth and poverty reduction. Unclean water and lack of basic sanitation have serious implications for the world’s poor, especially in relation to improving basic health and productivity. Recognizing the significance of water infrastructure to the sustainability of MCC’s mission, MCC has invested approximately $784 million in water and sanitation.

As part of our mission to reduce poverty through economic growth, MCC is dedicated to increasing the impact of compact funding by integrating the private sector into compact development and implementation. As the BCLC explains,  “The links between a lack of access to water and sanitation and development goals are clear, and the solutions to these problems are known and cost-effective. According to the ONE Campaign, meeting the water and sanitation MDG would have a total annual economic benefit of $22 billion for the continent of Africa alone. It is estimated that every $1 spent on water and sanitation generates returns of $8 in saved time, increased productivity, and reduced health costs.”

  At the forum, I had the opportunity to discuss MCC’s work in linking private sector investors to water and sanitation projects in MCC partner countries. In Jordan, for example, the MCC Compact is funding expansion of the As-Samra Wastewater Treatment Plant in partnership with a private sector operator that will mobilize a substantial share of the construction costs on a build-operate-transfer (BOT) basis. This is the first large-scale BOT arrangement that MCC has agreed to fund. MCC’s involvement will reduce the cost of capital, allowing consumers to pay lower water and wastewater tariffs than might otherwise have been necessary. This arrangement will also enhance operational sustainability by transferring some risks related to financing,  construction, and operations to the private sector.

The BCLC forum highlighted how the private sector, in partnership with other organizations, is implementing programs that go beyond philanthropic models to increase access to safe drinking water and improve sanitation in frontier markets around the world. As my fellow panelist John Sauer of Water for the People said, “Non-traditional [public-private] partnerships are what we’re really looking for, because we see that there’s a lot of added value. ...These kinds of non-traditional partnerships are key.”

At MCC, we know that incorporating private sector participation  into our compact investments helps ensure sustainability of those investments through expanded markets and increased innovation, job creation and trade. Stay tuned for more news on how MCC is leveraging its private sector partnerships, and read MCC’s Private Sector Toolkit (PDF)  to learn more about opportunities for investment in our partner countries.

 

Partnering for Progress in Africa

Posted on October 8, 2010 by Daniel W. Yohannes, Chief Executive Officer

During a week that showcased MCC’s commitment to Africa’s economic growth and development, I joined Donald Kaberuka, President of the African Development Bank (AfDB), to sign an agreement today under which MCC and AfDB will work together in promoting economic growth and poverty reduction in Africa. 

AfDB and MCC will share their core competencies and expertise to support country-led economic development initiatives, focusing on such key sectors as infrastructure, water and sanitation, land, agriculture, transportation, environment, health, and gender integration.  AfDB and MCC are already finalizing the details of our first collaboration: a pilot project in water and sanitation infrastructure in Mozambique.

When President Obama announced his new U.S. Global Development Policy last month in New York, he called for working with foundations, the private sector, NGOs, and multilaterals to maximize the impact of U.S. foreign assistance.  The President emphasized that development “cannot be the work of governments alone.”  Smart and deliberate collaboration with AfDB is one way MCC is implementing this new approach to development.  This continues MCC’s commitment to broadening the scope of our engagement with a range of traditional and non-traditional partners to achieve sustainable development and deliver results in the fight against global poverty.

MCC is Working With the Private Sector To Deliver Sustainable Results

Posted on September 22, 2010 by Frances Reid, Senior Investment and Risk Officer

On Monday night, MCC hosted a reception that brought together leaders from small- and medium-sized businesses, donors, the U.S. Government, and foreign governments to share ideas on ways in which we can partner to deliver sustainable solutions to the developing world. The event, “The Role of Business in Sustainable Development,” was held as heads of state, development leaders, and policymakers arrived in New York to start the Millennium Development Goals Summit, the Clinton Global Initiative, and the UN General Assembly meetings.

As the new investment and risk officer, I was very pleased to greet old friends and meet new and hopefully future partners. What I truly enjoyed was the conversations that I heard around the room. Whether it was Prime Minister Jose Maria Neves of Cape Verde and Lars Thunell, CEO of IFC, discussing the microfinance program in Cape Verde, or AES Corporation Chief Operating Officer Andres Gluski explaining the benefits of his company’s public-private partnership with MCC in El Salvador, guests were attentive and eager to build on the work they are doing to spur economic growth in emerging economies.

MCC CEO Daniel Yohannes issued a clarion call to our guests at our reception, “Let us forge strong partnerships for progress that will benefit our missions and interests as well as the lives of the world’s poor.” I hope that the conversations started this week will indeed forge a stronger partnership between the private sector and the development community.

Effectively Engaging the Private Sector

Posted on March 4, 2010 by Jason Bauer, Director of Private Sector Initiatives

This week more than 167 companies attended a procurement conference and heard about contracting opportunities arising from projects funded by Millennium Challenge Corporation compacts. Supported by Business Unity South Africa, Standard Bank, and the U.S. Embassy, the conference was hosted at the Development Bank of Southern Africa in Midrand, South Africa. Country teams from Burkina Faso, Lesotho, Malawi, Mozambique, Namibia, and Tanzania discussed over $3 billion in procurement opportunities, ranging from building roads and water systems to building health centers and schools. The compact in Ghana and compacts still being developed with the governments of Malawi and Zambia were also discussed.

The conference highlighted the business opportunities that ultimately support MCC’s mission of reducing poverty through economic growth. The conferences key themes included the openness and transparency of the procurement processes, the ability for international companies to bid on compact projects and the unique opportunities for U.S. and international suppliers.

Companies attending the conference included those focusing on infrastructure engineering, design, and construction, as well as those providing project management and technical assistance. The resounding message: MCC partner countries throughout Africa are open for business.