The Millennium Challenge Corporation’s Public-Private Partnership (P3) Platform, which launched in 2015, supports the agency’s mission of reducing poverty through economic growth by enabling the development of public-private partnerships in MCC partner countries with $70 million in grant funding. This commitment is expected to bring $1 billion in private-sector investments worldwide over the next five years.
A P3 is a long-term contract between a private party and a government entity in which the private party generally assumes the risk of designing, financing, building, and operating or maintaining a public asset or service in return for compensation linked to the private party’s performance.
P3s are complicated arrangements. Insufficient funding and expertise often prevent governments in developing countries from developing and managing P3s with private companies. The P3 Platform helps bridge that gap and empower governments to seek private sector funding.
MCC’s P3 Platform will:
- Help MCC partner countries build the skills and create the institutional and regulatory conditions needed to develop and manage P3s in line with international best practices.
- Bring P3 projects to market that are viable from a technical, economic, financial, legal, social and environmental perspective.
- Compile tools and resources on financing, technical assistance, and technology transfer to support the preparation of selected P3 projects—including resources from the U.S. Trade and Development Agency, U.S. Agency for International Development, Overseas Private Investment Corporation, U.S. Department of State, U.S. Department of Commerce, U.S. Department of Agriculture, and U.S. Department of Energy.
- Unlock investment and growth opportunities for U.S. companies in MCC’s partner countries, and catalyze critical financing that will advance MCC’s mission of reducing global poverty.
MCC partner countries will select P3 operators through an open, competitive selection process. The new platform will support partner countries in P3 project preparation in areas that directly support the objectives of MCC compacts.
Strengthening the Future of Development
Development needs around the world will not be met by foreign assistance alone. Official development assistance must increasingly catalyze other resources to finance development – including private-sector investment.
MCC believes that the key to unleashing growth potential in its partner countries is through active engagement and collaboration with the private sector, particularly in infrastructure.
The investment gap in infrastructure in developing countries constrains growth locally and globally. Governments across the developing world that seek to leverage private capital to fill this gap often find private investment in infrastructure is constrained by weaknesses in the investment climate and a lack of operationally feasible and financially viable infrastructure transactions.
MCC provides targeted grants designed to create measurable economic growth opportunities and incentivize better governance and open markets. This approach makes development assistance more effective, improves the lives of the world’s poor, and opens new markets for business.