Good morning everyone.
I’m really pleased to be here to participate in this important conversation about bringing business opportunities to U.S. companies and forging stronger connections between U.S. and African business leaders.
I want to thank IGD for convening us for this discussion. A huge thanks to Mima Nedelcovych and his entire team. MCC and IGD have worked together closely over the last few years and we look forward to continuing that partnership. This idea for a roadshow is really great, Mima, so congrats to you and your team.
From promoting trade and economic progress to countering violent extremism, the U.S. and Africa share a number of common interests.
The continent also presents great opportunity.
As many of you know, developing countries’ economies are growing three times faster than the U.S. In fact, according to the IMF, many of the world’s fastest growing economies are based in Africa.
Remarkably, Africa will be home to one quarter of the world’s consumers by 2030. So as the theme of the Roadshow implies, Africa is rising.
As you all know well, U.S. companies and investors are increasingly aware of the continent’s economic potential. But this is just the beginning: we know that there is progress to be made in deepening our trade and investment relationship, and increasing trade flows in both directions.
We are committed to working with African nations to realize the promise of a more peaceful, more productive, more prosperous world.
At MCC, we work with our government partners to improve investment environments, and increase opportunities for businesses. Through market-based reforms and innovative public-private partnerships, MCC works to draw in private investment.
Our strategic investments in economic growth advance security and stability around the world, and open up new trade and business opportunities by lowering risk.
So by helping the frontier markets of today become the emerging markets of tomorrow, we’re promoting growth that benefits African and American businesses.
Some of you may know of MCC, but those of you who don’t, let me take a minute tell you a bit more about how we work.
MCC is an independent U.S. Government agency created in 2004 with one mission: to reduce global poverty through economic growth.
We provide large scale grants – we call them Compacts – that range in size from $100M to $700M to poor, but well governed countries to fund projects we believe will catalyze private sector led economic growth.
Built on the lessons of decades of international development experience, MCC was designed to be unique in a number of ways.
First, we employ a transparent, competitive selection process; our partners must meet rigorous standards for good governance to qualify for assistance, and we use MCC’s scorecard to evaluate countries.
Our scorecard measures a country’s commitment to ruling justly, promoting economic freedoms and investing in their people.
In fact, our scorecard itself is an incentive for countries to improve their investment environments. Because countries must pass MCC’s scorecard to be eligible for funding, many countries make progress on policy indicators – such as reducing corruption, adopting business friendly policies and improving the rule of law – before MCC even spends a dollar.
We’ve heard from many in the private sector that they often use our scorecards and its 20 indicators to help evaluate the business environment in a country, and to understand what governments are doing to improve the marketplace for investment.
Second, we take a business-like approach, with bedrock commitments to data, accountability and evidence-based decisions.
And third, we focus on creating the right circumstances for businesses to invest in our partner countries, recognizing that private investment is the key to sustainable growth and poverty reduction.
We work closely with the private sector to leverage its expertise and incentivize policy reforms that open up market opportunities. Our compacts have leveraged billions of dollars in private investment.
We also work closely with our U.S. government partners at the Department of State, Treasury, USAID, the Overseas Private Investment Corporation, the Department of Commerce, the U.S. Trade and Development Agency, and others.
Since its founding, MCC has been deeply committed to supporting economic growth in Africa. We’ve invested nearly two-thirds of our portfolio to date in Africa. Over the last 14 years, we have partnered with 22 countries in Africa – from Burkina Faso, Côte d’Ivoire and Ghana to Malawi, Niger and Zambia.
Our investments on the continent total more than $8.6 billion – all grant financing.
With our partner countries we define our investments by working to identify the most binding constraints to private investment and entrepreneurship – identifying the factors that hold back economic growth in a country. We use that analysis to design our projects.
So at the root of every project is the goal of reducing poverty and increasing private sector-led economic growth.
Many of MCC’s investments are infrastructure projects, such as bringing irrigation to farmers and increasing access to reliable electricity for households and businesses.
But we also work on policy reform and improving governance. Our work to strengthen institutions helps countries withstand global threats such as terrorism, conflict, and natural disasters.
Our innovative approach – from viability gap financing for infrastructure projects to support of regulatory reforms – unlocks capital, improves investment environments, and helps create opportunities for firms in emerging markets.
And as we look forward, we hope to deepen our engagement in Africa through cross-border, regional investments. And just last week the US Congress passed legislation that would enable MCC to do just that. The legislation must still be signed by the President, after which we will begin to engage with our Board of Directors and other stakeholders to gather feedback on how we can operationalize this new authority.
Ultimately, through our investments, we are opening the door for companies to work in high-growth markets with fewer up-front risks.
Since our founding, catalyzing private investment for development has been fundamental to our work. We have a number of opportunities for companies to invest alongside our compacts.
For example, MCC’s $498 million compact with Ghana is supporting the Government’s efforts to improve the financial and operational health of the utility by bringing in a competitively selected private sector operator who will invest up to an additional $500 million to improve service for households and businesses, and reduce losses.
Our investments in Ghana are expected to help catalyze billions in new private investment – including from GE and Endeavour Energy – and help the Government better deliver reliable electricity services to its people.
We also have opportunities for business to invest in our compacts projects.
Our $375 million investment in Benin seeks to expand access to reliable electricity and crowd-in commercial finance. Just last month, we launched an Off-Grid Clean Energy grant facility that will fund – in partnership with the private sector – critical public infrastructure, household solar systems, and mini-grids.
The grant facility is accepting project finance applications through May 22. So I hope some of you here today consider this opportunity. You can find out more information on our website, MCC.gov.
In Cote d’Ivoire, MCC signed a $525 million compact in November. The program aims to catalyze growth and private investment by building a more skilled workforce and investing in transportation and logistics infrastructure to increase the mobility of goods and people in Abidjan, Côte d’Ivoire’s commercial capital.
The program was designed through sustained consultation with the private sector, with the ultimate objective of creating new opportunities for citizens and businesses both in Cote d’Ivoire and here in the US.
Similar to our investments in Cote d’Ivoire, there are opportunities in Morocco for the private sector to co-invest with us on entrepreneurship programs and technical/vocational training to ensure workers have the exact skills to meet the needs of the businesses that are fueling economic growth.
And most recently, in January, we formally launched implementation of our $437 million dollar compact in Niger that focuses on strengthening the agriculture sector and increasing access to markets to drive growth. And we are looking for private sector partners.
In Tunisia, Senegal and Burkina Faso, we are currently developing compacts, so, down the road, there will be new investment and procurement opportunities associated with those.
We want to forge strong, innovative partnerships with the private sector to increase the impact of our investments.
Identifying new sources of capital for investment in public infrastructure and services is critical to advancing economic growth and addressing development challenges going forward.
These are just a few examples of opportunities for us to work together; I understand that you will hear about additional opportunities later in the day.
Finally, in addition to investing alongside of us, some of you may be interested in contracting with us or our country partners in implementing the projects supported through our Compact.
Let me leave you with a few reasons to work with MCC.
First, all contract payments are paid directly by the U.S. Treasury. This mitigates common risks associated with working in emerging economies and guarantees that invoices are paid as quickly as possible.
Second, all money is available up-front. MCC’s funding is appropriated by the U.S. Congress and committed to specific programs.
Third, our procurement process ensures a fair playing field. All contracts are based on fair and open competition.
Millennium Challenge Accounts, which are the organizations set up in our partner countries to implement MCC compacts, manage procurements. However, MCC provides extensive oversight at every step of procurement process so companies are treated fairly.
And of course, by working with us, you’ll have the opportunity to do well, while doing good.
I encourage you to visit our Work With Us page for a comprehensive look at our procurement, partnership and investment opportunities.
I also want to mention that MCC is joining IGD on the road! MCC staff will be participating in other Roadshow city stops- including in Houston to join the conversation about the importance of investing in the power sector in Africa.
We are optimistic about the potential for partnering with the private sector to increase economic growth and reduce poverty. By connecting investors to new, underserved markets, we can expand opportunity for millions of people across Africa.
We hope you’ll join us in investing in the power and promise of Africa.
Again, thank you IGD for bringing us together today.