Millennium Challenge Corporation Board of Directors Announces 2007 Compact Eligible Countries: Moldova, Jordan, and Ukraine
For Immediate Release
November 9, 2006
Washington, DC The Board of Directors of the Millennium Challenge Corporation (MCC) today selected three new countries to join the 22 nations now eligible for development assistance from the Millennium Challenge Account (MCA).
Moldova, Ukraine, and Jordan were chosen to begin the process of applying for Compact assistance. Since its establishment in 2004, MCC has approved Compacts totaling nearly $3 billion with 11 countries: Armenia; Benin; Cape Verde; El Salvador; Georgia; Ghana; Honduras; Madagascar; Mali; Nicaragua; and Vanuatu. MCC is also actively engaging with other eligible countries to assist them in Compact development.
Each November, MCCs Board of Directors meets to select countries eligible to develop a proposal for assistance under the MCA. The assistance program is designed to reward good performance and also to create incentives for countries to adopt policies that create a foundation for poverty reduction and economic growth.
Because of their ongoing commitment to good governance as well as sound economic and social policies, our newly eligible countries demonstrate that they are, in fact, taking necessary steps to create, reinforce, and maintain a policy environment in which MCCs aid can help them reach specific goals of poverty reduction, said Ambassador John Danilovich, MCCs Chief Executive Officer. Compact-eligibility is the reward for pursuing good policies. These countries are now invited to begin the process of creating their Compacts to reduce poverty, he added.
MCC measures policies in all candidate countries using 16 independently measured and transparent benchmarks known as indicators, which have a demonstrated link to poverty reduction and economic growth. These indicators measure countries demonstrated commitment to policies that promote, among other things, political and economic freedom, investments in education and health care, control of corruption, and respect for civil liberties and the rule of law. MCC is using two supplemental indicators this year to evaluate performance on countries commitment to promoting sustainable natural resources management policies.
Once selected as eligible, countries begin a consultation process that includes citizens, nongovernmental organizations, and representatives of the private sector and government to identify the barriers to poverty reduction and economic growth. MCC teams then work in partnership to engage with countries on their Compact proposals to ensure that projects meet economic growth and poverty reduction targets. A Compact also describes how the country plans to manage and implement its MCA program, including how it will ensure financial accountability, transparency, fair and open procurement, and measurable results. Selection as an eligible country does not guarantee funding.
Many countries have identified land tenure and agriculture projects, micro-lending programs, and improvements to irrigation systems as well as water and sanitation services as priorities in efforts to reduce rural poverty. Other countries have proposed building industrial parks, a trade school, health clinics, rehabilitation of roads, ports, and railroads as key to improving access to markets and jobs. Better roads also have the benefit of improving access by people to schools, health clinics and other essential services.
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.