Press Release

For Immediate Release

July 12, 2006

Contact: 202-521-3880

Email: info@mcc.gov

MCC Board of Directors Approves Five-Year $547 Million Anti-Poverty Program Targeting Rural Poor inGhana

Washington, D.C. The Board of Directors of the Millennium Challenge Corporation (MCC) today approved a five-year, approximately $547 million, anti-poverty program in Ghana.

The program, also known as a Compact, will benefit more than one million Ghanaians and focuses on rural agriculture, transportation and community development initiatives. The Compact targets some of the poorest rural districts where poverty rates range from 40 to 90 percent. The Compact components will raise the income potential of farmers through increased production of high-value cash and basic food crops, an improved transportation network and development of food processing industries and handling facilities. The five-year program also includes improvement of land tenure and credit access for small farmers and agribusinesses. The Compact also includes an initiative to improve access to education, water and sanitation, and electricity in the areas participating in the program.

This program is designed to drive economic growth through the efforts of and for the benefit of some of the poorest farmers and farming communities in Ghana, said MCC CEO Ambassador John Danilovich. MCC was designed and created to work with and reward nations that have demonstrated a commitment to adopting sound political, economic and social policies that will reduce poverty through economic growth. Like all MCA countries, Ghana ‘s participation in MCC’s program is predicated on its dedication to three fundamental principles: ruling justly, investing in people, and encouraging economic freedom.

The program’s agriculture component the largest component, with an estimated five-year cost of $241 million enhances the profitability of commercial agriculture among small farmers by improving business and farming skills, access to credit, land tenure and marketing services. This component also includes irrigation improvements and rehabilitation of rural roads.

The transportation component with an estimated five-year cost of $143 million includes rehabilitation of a 14-kilometer stretch of the major highway linking the international airport in Accra, the capital, and the port city of Tema. This component also includes finance of the rebuilding or construction of 230 kilometers of two-lane roads to improve the access to agriculture markets and social services in the central Afram Basin area. Improvements to the Lake Volta ferry service to facilitate faster access to markets will also be supported.

The program also includes a five-year $101 million rural development component to expand access to community services and to strengthen rural institutions by funding construction and rehabilitation of schools, water and sanitation facilities, electrification of rural areas, and providing capacity building support to local government institutions. This component also includes financing of an initiative to automate and interconnect 121 small rural, community-owned banks, and other improvements in the national payments systems that will draw into the financial system people currently not served or under-served.

Since its establishment in 2004, MCC has approved Compacts totaling more than $2.1 billion with nine nations: Madagascar, Honduras, Cape Verde, Nicaragua, Georgia, Benin, Vanuatu, Armenia and Ghana. MCC is also actively engaging with other eligible countries in Compact negotiations.

###

Millennium Challenge Corporation (MCC), a United States government corporation designed to work with some of the poorest countries in the world, is based on the principle that aid is most effective when it reinforces good governance, economic freedom, and investments in people that promote economic growth and elimination of extreme poverty.