Thank you, Rob. It’s a pleasure to be here alongside Ambassador Green and Ambassador Yamamoto.
As you may know, we’ve been excited to welcome Ambassador Green back to MCC’s Board of Directors, and Dr. Nedelcovych is the chair of MCC’s Advisory Council, so it’s great to see them both here.
For those of you less familiar with the Millennium Challenge Corporation, we’re an independent U.S. Government agency with a singular mission: to reduce global poverty through economic growth. Created in 2004, we provide time-limited grants and assistance to poor countries that meet rigorous standards for good governance, from fighting corruption to respecting democratic rights.
We call our grants compacts, which range from about $50 to $700 million and last five years. We work across sectors – energy, transportation, agriculture, education – and we’re selective about where we invest. MCC only partners with low and lower-middle income countries that pass a policy scorecard of 20 public indicators clustered into three categories: good governance, economic freedoms, and investing in their people.
Over our last 13 years, we invested nearly $12 billion in economic growth projects around the globe, with more than 65 percent of that invested in Africa. We’ve partnered with 23 African countries and currently have 14 active programs in Africa.
Just a few weeks ago, our Board of Directors approved a new $525 million compact with Côte d’Ivoire. The program is designed to support economic growth and private investment by building workforce capacity, reducing transportation costs, and opening new markets – benefitting the region and firms looking to expand their businesses. We’re looking forward to signing the compact this fall.
Many African governments today are increasingly stable and democratic, and from MCC’s experience, increasingly committed to implementing reforms and working with the private sector to build an environment for businesses to invest.
We see that in Côte d’Ivoire, which exemplifies what we call ‘the MCC effect’ − MCC’s ability to drive reforms even before a dollar of U.S. taxpayer money is spent. The Government of Côte d’Ivoire adopted MCC’s policy scorecard as its roadmap for business reform after passing only five of 20 policy indicators in 2013. After Côte d’Ivoire passed MCC’s scorecard in 2015, MCC’s Board of Directors selected the country as eligible to develop a compact. Remarkably, on MCC’s most recent scorecard, Cote d’Ivoire passed 14 indicators – a dramatic rise.
And we see it in Malawi, where firms consistently cite weakness in the electricity sector as one of the major obstacles to doing business. Today, with MCC’s support, the Government of Malawi is working to modernize infrastructure and strengthen institutions in its power sector to expand accessibility and reliability, while adopting policies that encourage accountability and private investment. We are particularly impressed with the turnaround at the main power utility in Malawi that went from being deep in the red just a few years ago to now being on solid commercial footing, to the point that it was able to secure an investment grade credit rating this year.
In addition to Malawi, MCC investments in Benin, Ghana, Liberia, and Sierra Leone are helping to strengthen electricity systems and support policy reforms that drive business participation in the sector. In Ghana, we expect MCC’s investment in the power sector to catalyze nearly $4 billion in new private investment, including a major investment from GE and Endeavor Energy.
So our investments not only fund large infrastructure projects, but also help governments make critical policy and institutional reforms that help them both better deliver services to their people and catalyze business investment.
In all of our programs, we look for opportunities to leverage public spending. Through public-private partnerships, we aim to mobilize the capital, expertise and efficiency of the private sector to deliver faster, better, affordable services and generate more sustainable development outcomes.
Over the course of our engagement with a partner country, MCC also engages with the private sector, other donors, local and international non-governmental organizations, and foundations. This gives MCC’s investment every opportunity to spur additional investment and accelerate and sustain poverty reduction long after our five-year investment comes to an end.
Last year, MCC established an Office of Strategic Partnerships to provide a vision and strategy for MCC partnerships that align with our agency goals. The office is more fully incorporating partnerships into our work to increase the scope, impact, and sustainability of our poverty-fighting programs.
We also launched the MCC Advisory Council, which offers a platform for systematic engagement with the private sector, building on our ongoing work with the global business community. The Council’s industry expertise, insights and technical recommendations help to inform and deepen MCC’s public and private-sector partnerships.
The Organisation for Economic Co-operation and Development will soon release its Blended Finance Principles for its members. MCC sees itself as a key supporting actor in the development of the blended finance sector, and we will align our business practices to incorporate these new principles.
So MCC is focusing more systematically on using the full range of our robust toolkit to build new market opportunities in frontier economies and crowd in private investors. It maximizes our impact and enhances the sustainability of our investments.
And as new opportunities emerge, we’re working to make sure U.S. businesses know about them. MCC is currently implementing a detailed market outreach strategy to inform, attract, and encourage American firms to work with MCC.
This includes a new “Work With Us” section of our website, providing a 12-month forecast of upcoming procurement and grant opportunities, identifying specific procurement and partnership opportunities suitable for U.S. firms, and soliciting feedback on barriers to participation so we can help to address those obstacles.
So before I hand things off to Ambassador Yamamoto, I encourage you to visit us online at www.mcc.gov and see what opportunities are out there for us to work together.
Again, it’s great to be here, and thank you to IGD for bringing us together for this important conversation.