Press Release

MCC Completes First Compact, Celebrates Successful Partnership with Honduras

MCC CEO Joins Honduran President Lobo for End of Compact Celebration

For Immediate Release

September 17, 2010

Washington, D.C. — Millennium Challenge Corporation (MCC) Chief Executive Officer Daniel W. Yohannes joined Honduran President Porfirio Lobo, U.S. Ambassador Hugo Llorens, and hundreds of beneficiaries and stakeholders today in Tegucigalpa to celebrate the results of MCC’s $205 million economic growth compact with Honduras.

“Today we mark the culmination of MCC’s compact with Honduras,” said Mr. Yohannes.  “Our partnership with the people of Honduras has achieved impressive results over the past five years.  These results are expected to provide a foundation that Hondurans can build on in achieving even greater poverty reduction and economic growth.” 

Honduras was one of the first countries to sign a compact with MCC.  The compact, signed in June 2005, invested in a broad range of constraints to economic growth in the agriculture sector, including assisting farmers with technical training, providing farmers with access to credit, and building farm-to-market roads.  The compact also invested in rehabilitating the primary national highway that connects Honduras with international markets. 

In a congratulatory note to MCC and Honduras, U.S. Secretary of State Hillary Rodham Clinton said, “The Millennium Challenge Corporation compact is a crucial part of our commitment to work as partners with the people and Government of Honduras to reduce poverty and promote effective, sustainable development throughout the country and across Central America.  After five years, the MCC compact has helped increase agricultural productivity and reduce the cost of transportation in Honduras through strategic investments in training and infrastructure.  Honduran farmers are earning more income, expanding their operations, and pulling themselves and their families out of poverty toward a future of greater opportunity.  The MCC compact has helped lay the foundation for a brighter future for all Hondurans.”

At the celebration event in Tegucigalpa, Honduran Vice President María Antonieta de Bográn said, “I am proud to be here as we conclude one of the most succesful projects in the history of international cooperation in Honduras.  This is the best example of the friendship and partnership with the people and Government of the United States, through tangible results that can be seen now and will continue for the future.” 

U.S. Ambassador to Honduras Hugo Llorens said, “This compact was implemented in partnership with the Honduran people to address priorities for poverty reduction through the promotion of economic growth, particularly in the rural sector.”

Because of MCC’s country-driven approach to assistance, Hondurans themselves designed a development plan that built local capacity.  MCA-Honduras managed the implementation of the compact, developing local expertise and institutional knowledge. 

MCA Honduras Executive Director Martín Humberto Ochoa remarked on the opportunities ahead for Honduras, “Today we celebrate the end of the program that we implemented and are grateful to the American people and government. The challenge now continues for Honduras to strengthen the institutional and public investments made in partnership with private participation, enhance the results achieved, and ensure the sustainability of these achievements.”

Key results from MCC’s compact with Honduras:

More than 7,000 farmers have been trained under the Farmer Training and Development Activity, with over 6,000 of those farmers increasing their production of crops and earning $2,000 per hectare or more, demonstrating they have substantially adopted the new techniques needed to continue to generate higher income.  Prior to receiving technical assistance, these farmers were earning an average of approximately $1,100 per hectare, according to preliminary data.  As part of MCC’s commitment to measure results accurately, upcoming impact evaluations will assess the full extent of the impacts that can be attributed to MCC’s investments, including actual increases in household income.

Hondurans will have better access to markets, education, and healthcare thanks to MCC funds improving approximately 500 kilometers of rural roads, as well as over 170 kilometers of the CA-5 highway and nearby secondary roads, throughout Honduras.

Farmers now have access to credit services that are aligned with their production needs.

The compact required that the Honduran Government increase its road maintenance budget to sustain investments in the national road network.  As a result, Honduras has increased its annual road maintenance funding from $37 million in 2005 to $64 million in 2010. 

“MCC’s foundational principles including country ownership, accountability, and a focus on results, are all part of the U.S. Government’s broader strategy to bolster international development efforts,” said Mr. Yohannes.  “These principles have been embodied in MCC’s partnership with Honduras to achieve real results leading to economic growth and poverty reduction.”

Over the next 20 years, MCC’s investment in Honduras is expected to benefit more than 1.7 million people and increase incomes by $240 million—tangible evidence that American development assistance dollars are making a difference in the lives of millions of poor people around the world. 

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