Speech

March 3, 2008

As Prepared by John J. Danilovich, Chief Executive Officer

Sotheby's Institute of Art, New York City

‘Cultural Preservation and Poverty Reduction: Discovering the Link in Morocco through the Millennium Challenge Corporation'

Introduction

Thank you so much, Warren, for that kind introduction.  I’m very excited to be here at the Sotheby’s Institute of Art—in this magnificent building.  You represent a first for me.  As a U.S. government official, heading up an international development agency, yours is the type of group I do not normally address.  But, I believe your interest in America’s commitment to

  • cultural,
  • architectural,
  • archeological,
  • heritage, and
  • artistic preservation

can also be tied to our nation’s interest in poverty reduction and economic growth around the world. 

The series of discussions hosted by Sotheby’s to examine the crossroads of art and social action provides a perfect opportunity for me and the Millennium Challenge Corporation to explore this subject with you. 

The concepts of cultural preservation and poverty might initially seem worlds apart.  Poor countries and peoples are more inclined to think about merely surviving rather than preserving their artistic treasures and historical sites. We are, however, finding that we can preserve cultural heritage and centuries-old artisan traditions while, at the same time, helping people out of the trap of poverty.   

A problem as daunting as poverty and a challenge as important as preservation are, of course, the work of many—from

  • UNESCO,
  • to each Ambassador’s Special Fund for Cultural Preservation,
  • to the work of humanitarian organizations,
  • as well as the United States Agency for International Development. 

Your presence here—as

  • students and patrons of art,
  • champions of cultural preservation,
  • and avid followers of international affairs

—make you all part of the solution as well.

Finding

  • tangible,
  • measurable,
  • and sustainable

ways to stem the tide of poverty around the world is what we do at the Millennium Challenge Corporation.  Our mandate is to reduce poverty through sustainable economic growth.  Let me take a moment to explain what that entails, and then to discuss the MCC-Morocco compact as an example of the connection between preservation and poverty reduction.

MCC 101

MCC fights poverty by stimulating economic growth.  To do this, we partner with some of the world’s poorest countries and provide them with development assistance in the form of grants, not loans.

Congress created MCC in 2004 as an independent government agency to deliver this development assistance, reaffirming the compassion and generosity of the American people to constructively engage in the fight against global poverty. 

Half of our fellow world citizens live on less than $2 a day, and fighting poverty abroad certainly serves our interests here at home.  In a speech last month at the Carnegie Endowment for International Peace, National Security Advisor Stephen Hadley summarized this link best when he said,

“…[W]e also recognize that helping people in the developing world is very much in our national interest. People who are free, educated, healthy, empowered, and able to use their freedom to enhance their economic well-being are less likely to support terror or attacks on others. If this new century has shown us anything, it is that our own prosperity, freedom, and security are increasingly intertwined with those of less developed nations.”

Americans have always been generous, but, we should note that this country’s foreign assistance amounts to less than one-half of one percent of the total U.S. budget.  In order to maximize the effectiveness of such aid in reducing poverty, MCC takes a

  • different,
  • innovative,
  • and strategic

approach.  And, we are very proud of this approach. 

This approach is predicated on the three key principles of

  • policy performance,
  • country empowerment, and
  • results.

First, we believe policies matter, so MCC funding is performance based.Each year, we create a summary of performance—a scorecard—for every poor country in the world, using 17 policy indicators that measure whether a country

  • governs justly,
  • invests in health and education,
  • promotes economic freedom,
  • protects the environment,
  • and fights corruption. 

Non-U.S. government organizations—like the

  • World Bank,
  • IMF,  
  • the World Health Organization,
  • UNESCO,
  • Transparency International

—create the indicators we use.

Using these results, we invite only those poor countries that pass our scorecard to join our program.  In this way, we create a competition among countries for MCC funding based on sound policy performance.  We don’t think it’s too much to ask of countries receiving American taxpayer dollars that they practice good policies and demonstrate the political will to use our aid effectively.

And, we know this performance-based approach to aid works because we see country after country scramble to make policy reforms to qualify for our program. Those already in the program must keep up their performance to stay in.  Many have called this phenomenon the “MCC Effect,” where the promise of qualifying for our aid and maintaining eligibility for it motivates continuous policy reform.

Second, countries invited to join the MCC program because of good performance are empowered to lead their own development.MCC places the responsibility with the recipient country itself to examine its own constraints to poverty reduction and economic growth and to design its own solutions—country-driven solutions to country-determined challenges. 

To do this, we ask countries to consult extensively with their citizens—from the

  • private sector,
  • to nongovernmental organizations,
  • to civil society groups

—and outline their own priorities for eliminating barriers to poverty reduction and growth. This process includes the active participation of women, not only because of MCC’s groundbreaking gender policy but also because it makes the most sense. 

As we prepare to celebrate International Women’s Day this upcoming Saturday, we are reminded that a development strategy that ignores half of its citizens is, by definition, doomed to fail.  Hence, we demand that all citizens—

  • men and women,
  • the young and elderly,
  • those in rural and urban areas

—work side by side to develop and implement their development strategy. 

Third, once their proposals are approved by MCC, we ask countries to take charge of implementing their programs to deliver tangible results. We believe it is essential for countries to take the responsibility for—to buy into—the creation and implementation of their own program.  We say to countries: Do it for yourself; we’ll give you the money, but you take the responsibility for the success of your own development.  This is not easy.  Capacity is often lacking.  But, MCC is not a handout; rather it is a hand up.

In the four short years since MCC’s creation, we have signed 16 large-scale antipoverty agreements—what we call compacts—with countries in

  • Africa,
  • Central America,
  • Eurasia,
  • and the Pacific

totaling $5.5 billion. 

We are now implementing these programs, and early, impressive results include:

 

  • issuing land titles,
  • increasing farmer incomes through better agriculture techniques,
  • creating jobs,
  • increasing market access for small businesses,
  • improving infrastructure, such as
    • seaports,
    • bridges,
    • airports,
    • roads,
    • storage facilities,
    • and irrigation canals,
  • opening health clinics and containing the spread of HIV/AIDS and other diseases,

  • building and operating girl-friendly schools,

  • expanding vocational training,

  • strengthening financial services and access to credit, and

  • improving access to water and sanitation services.

These efforts prove that the MCC model is working and we are seeing sustainable and measurable change take root in our partner countries, including in Morocco.   

The Case of Morocco

I’d like to tell you about our compact with Morocco.  I was in that beautiful country last month to check on the implementation of that country’s nearly $700 million MCC compact, which makes strategic investments in

  • fruit tree productivity,
  • small-scale fisheries, 
  • artisan crafts,
  • financial services, and
  • enterprise support. 

Nearly $112 million of Morocco’s total compact is directed to reducing poverty and stimulating growth by supporting the country’s centuries-old artisan sector, especially in the Fez Medina area.   It does this in three ways:

  • by leveraging the links between the craft sector and tourism, 

 

  • by increasing the value of the rich
    • cultural,
    • historic,
    • and architectural

assets of the Fez Medina, recognized as a UNESCO World Heritage site, and

  • by assisting potters in the Fez area meet growing demand for high quality Moroccan pottery by investing in modern techniques and equipment, including cleaner, gas-burning kilns to replace
    • traditional,
    • very high-polluting,
    • wood-burning ones,

while maintaining old artisan know-how and practices.

So, can preservation of these ancient arts serve as a way out of poverty? We, and the Moroccans, believe it can. Among all MCC compacts to date, Morocco’s compact demonstrates most powerfully the intersection between cultural preservation and poverty reduction.  The MCC-Morocco compact stands at the crossroads of where art and social action for the benefit of the poor meet.

Those of you who have been to Fez know that it is a beautiful and ancient city, rich in cultural history and stunning objects.  Yet, some 30 percent of its residents live below the poverty line.  Of all the impressive things I saw while there—and I saw a great deal—most impressive was the incredible willingness of Moroccan artisans to create something of beauty and to transform it into something that will positively impact their own lives. Helping craftsmen preserve their traditions while also prospering from the process is a scenario where not just Moroccans, but all of us, stand to benefit.

Let me illustrate with some photos

 

Group 1 of photos: Photos 1 and 2

http://www.mcc.gov/images/content-photo-030308-01-sothebys.jpghttp://www.mcc.gov/images/content-photo-030308-02-sothebys.jpgThe first two photos are of the Makina site—within the Fez Medina—which MCC funds will rehabilitate.  It was an ammunition factory that was constructed by Sultan Moulay Hassan the 1st in the 19th century.  There will be an international design competition for the site’s rehabilitation that will focus on creating a venue conducive to opportunities for poverty reduction through economic growth.

Group 2 of photos: Photos 3, 4, and 5

The next three photos are of the Lalla Yadounna plaza, where we will also be involved in rehabilitation work. This plaza is strategically located at the crossroads of two main districts of the Medina—Qarawiyin, where one of the world’s oldest universities is located, and Andalus, where many important historic monuments are located.

http://www.mcc.gov/images/content-photo-030308-03-sothebys.jpghttp://www.mcc.gov/images/content-photo-030308-04-sothebys.jpg

http://www.mcc.gov/images/content-photo-030308-05-sothebys.jpg

Group 3 of photos: Photos 6, 7, and 8

MCC funding will rehabilitate the Chemmaine and Sbitriyine fondouks.  As you can see in these photos, these were—and with MCC’s assistance will again be—very impressive structures.

http://www.mcc.gov/images/content-photo-030308-06-sothebys.jpghttp://www.mcc.gov/images/content-photo-030308-08-sothebys.jpghttp://www.mcc.gov/images/content-photo-030308-07-sothebys.jpg

Photo 9

The Staouniyine fondouk, which you see here, is of unique importance since it shares a wall with Qarawiyin University.  It is the home of many artisans today, but given the state of its decay, it is underutilized. MCC funds to rehabilitate this fondouk will create a place for increased economic activity, while restoring this historic treasure.

Group 5 of photos: Photos 10 and 11

We are also supporting the rehabilitation of the Baraka fondouk.  This is located next to Qarawiyin University and, in times gone by, served as a hub and hostel for traveling merchants.

The renovation and reconstruction of these prominent and historically significant sites within the Fez Medina will better serve local residents and attract visitors, while, at the same time, maintain the historical and cultural integrity of this beautiful city and protect the environment.    

These sites were chosen for rehabilitation because they are most likely to generate economic growth opportunities within the Medina, benefiting artisans and tourists.  Moroccans are using their MCC compact to take areas of decay and underutilization—yet of incredible potential and tremendous possibilities—and breathe new economic life into them.

 

In addition, MCC’s artisan and Fez Medina project will:  

  • improve the national training system for literacy and vocational education to benefit artisans and the general population, particularly women and girls. 
  • It will update artisan training centers.
  • It will provide artisans with technical assistance to access financial services from local banks and microcredit associations so they can invest in modern kilns or pottery workshops.
  • It will support marketing campaigns to highlight artisans and their crafts within the Fez and Marrakech Medinas, including promoting a label to clearly distinguish genuine Moroccan crafts from imitations.
  • It will support a pilot campaign to promote Moroccan artisan exports.
  • It will develop a production zone for copperware workers.
  • It will identify and evaluate options for traditional tanneries to meet national and international
    • environmental,
    • health,
    • and safety standards.

All these projects stimulate economic activity and growth with the artisan community, and provide sustainable ways to replace poverty with prosperity.

These activities—aimed at cultural and heritage preservation—will reduce poverty by stimulating the Medina’s main industries—tourism and artisan production. They are estimated to directly benefit 20,000 low-income workers in the Fez Medina.  We also suspect that there will be a number of indirect beneficiaries and, while it is too early to estimate the number, we expect it to be substantial.

Conclusion

Morocco is a trailblazing and unique example of how cultural preservation and poverty reduction can go hand-in-hand. 

The preservation of Morocco’s cultural heritage is a worthwhile objective in its own right.  It is also a viable and sustainable means of opening new economic opportunities for exceptionally gifted, but extremely poor, artisans and their families.

True to the MCC model, Moroccans themselves—not MCC—pinpointed the development of their artisan sector as simply vital not only to preserving their cultural heritage but also to advancing their country’s agenda for poverty reduction and economic growth.

Can the concept be extended to other countries working on their own compacts? Given how the MCC model works, that is entirely up to those countries to determine within the context of their own development priorities, but Morocco offers a striking example of how the intersection between cultural preservation and poverty reduction is tangible and mutually reinforcing.  I felt it firsthand in conversations I had with artisans in Fez, who will make good use of MCC investments.

Of course, it is worthwhile to appreciate and support cultural preservation in and of itself, but it is also important to appreciate and support its role in combating poverty and how this furthers our shared vision for a prosperous and peaceful global community. 

Thus, the beauty of these sites and these works transcends the body of art itself.  Their value and beauty can also be found in the most important medium of all—human life.  

The Millennium Challenge Corporation is extremely proud of our role in making this vision of prosperity a reality, and I appreciate your interest in our work around the world, including Morocco’s unique MCC program.

Again, I am grateful for the invitation to be here and welcome your questions and the discussion to follow.  Thank you!