Press Release

Millennium Challenge Corporation Board Approves Vanuatu Compact

For Immediate Release

January 3, 2006

Washington, D.C. The Millennium Challenge Corporation has approved a five-year $65.69 million Compact with Vanuatu . The Millennium Challenge Program is expected to increase average income per capita by 15% within five years and directly impact the lives of more than 65,000 of the rural poor in Vanuatu. Presently, approximately half of Vanuatu’s citizens live in poverty. An island nation comprised of 83 islands in the South Pacific, Vanuatu identified costly and unreliable transportation infrastructure as a major impediment to economic growth. To overcome this constraint, the Compact consists of up to eleven infrastructure projectsincluding roads, wharfs, an airstrip and warehousesthat will help poor, rural agricultural producers and providers of tourist related goods and services reduce transportation costs and improve access to transportation services. The Compact also includes an institutional strengthening component and policy reform initiatives to ensure the sustainable operation and maintenance of Vanuatu’s entire transport infrastructure network, not only those assets built or rehabilitated with MCC funds.

Congratulations to the people and Government of Vanuatu for completing an ambitious and transformative Compact, said MCC CEO Ambassador John Danilovich. The ni-Vanuatu have developed a results-oriented program that will improve the lives of the rural poor by giving them access to increased economic activity through improved roads and transportation infrastructure. This Compact is a testament to Vanuatu’s commitment to good governance and desire to chart their path to economic development.

MCC expects to sign the Compact with Vanuatu in February.

Since its establishment last year, MCC has signed Compacts totaling more than $900 million with five nations, Madagascar, Honduras, Cape Verde, Nicaragua, and Georgia. MCC is also actively engaging with other MCA-eligible countries in Compact negotiations.

Launched by President Bush, the Millennium Challenge Account is a different approach to development assistance that recognizes sound policies and good governance as critical to poverty reduction and economic growth in developing countries.


Millennium Challenge Corporation (MCC), a U.S. 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.