|(in millions of $)||FY 2016 Enacted||FY 2017 Enacted||FY 2018 Request|
|Compact Development/Oversight: 609(g) and Due Diligence||94.0||93.9||89.2|
|Office of the Inspector General||5.0||5.0||4.5|
*Numbers may not add due to rounding.
The Millennium Challenge Corporation (MCC) requests $800 million for FY 2018 for programs in Mongolia, Senegal, Sri Lanka, Togo, and Timor-Leste, as well as to support the development and implementation of programs designed to fight poverty through economic growth in 21 other countries. These countries, which have a combined population of about 118 million people living on less than $1.90 per day, have earned eligibility for MCC‘s time-limited grant investments designed to help people lift themselves out of poverty and create more stable, secure countries with new business opportunities abroad for American firms.
FY 2018 funding will allow MCC and partner country governments to tackle binding constraints to economic growth specifically in Mongolia, Senegal, and Sri Lanka—three compact countries that meet MCC’s rigorous standards for partner eligibility and are located in strategically significant regions of the world. Each of these countries has proven to be a strong partner dedicated to developing results-driven compact programs that meet MCC’s standards for accountability, continued good governance, and broad impact. FY 2018 funds will also support new threshold programs in Togo and Timor-Leste through programs designed to improve policy performance and strengthen institutions to help them become compact-eligible. The compact development process for Burkina Faso, Côte d’Ivoire, Mongolia, Nepal, Philippines, and Tunisia—countries with great potential for economic growth and poverty reduction—is also reliant on FY 2018 funding.
MCC works only with a select group of low and lower-middle income countries that demonstrate a commitment to democratic governance, economic freedom, and rule of law. To date, MCC has signed 33 compacts with 27 different country partners, along with 26 threshold programs, totaling more than $11 billion in investments.
MCC’s business-like approach is based on selectivity, evidence-based decision-making—including transparent economic analyses—country ownership, and accountability, which are widely recognized as key tenets of effective foreign assistance. MCC works closely with the private sector to leverage its expertise and incentivize policy reforms that open up market opportunities. By holding the agency and our partner countries accountable for results and continued good governance, MCC advances American security, values and prosperity.
Investments by MCC have leveraged more than $6 billion in additional investments and commitments from the private sector and other development partners, including more than $850 million by partner countries themselves to support compact and threshold program projects in their countries. This level of commitment from partner countries and the international and domestic private sector helps ensure the sustainability of MCC’s investments over the long term.
Despite the relatively small portion of U.S. federal funding spent on foreign assistance, it remains one of the greatest values for U.S. taxpayers. In today’s global economy, half of all U.S. exports go to developing countries. MCC’s compacts with country partners are often the cornerstone of the U.S. economic relationship, and they benefit the American people by strengthening U.S. national security and increasing opportunities for American businesses.
Evidence shows that the primary driver of poverty reduction is broad-based economic growth, and development programs focused on growth-enhancing policy reforms and investments can play a critical role in sustained poverty reduction. In addition to funding large-scale infrastructure projects, MCC helps partner country governments make critical reforms that create an enabling environment for private sector investment and advance project sustainability.
Reducing global poverty creates a more stable, secure world with more opportunities for prosperity at home and abroad. With cost-effective projects, a lean staff, and an evidence-based approach, MCC is a good investment for the American people.
FY 2018 Goals
Full funding of this request will not only advance good governance and economic growth around the world, but also make lasting improvements in the lives of the poor and strengthen institutions so partner countries can better deliver much-needed services to their people.
This request will give MCC the leverage needed to incentivize policy reforms and the resources required to help partner countries realize their full economic potential. Fully funding the Administration’s request for MCC will provide the agency the resources it needs to:
- Directly support grants to Mongolia, Senegal, and Sri Lanka.
- Mongolia’s compact is expected to focus on a set of specific investment activities to increase bulk water supply and improve water service delivery including groundwater extraction, industrial water reuse, and institutional and regulatory policy strengthening.
- Senegal’s compact will likely focus on energy infrastructure, institutional strengthening, upgrading power transmission and distribution, and improved electricity access in rural areas.
- Sri Lanka is developing a compact expected to focus on transportation bottlenecks and access to land for commercial and industrial uses.
- Connect some of the world’s poorest people to jobs, markets, and opportunities by helping partner governments deliver services like clean water, reliable electricity, roads, land rights, and schools to their people. About 70 percent of MCC’s portfolio is dedicated to large-scale infrastructure in the transportation, agriculture, energy, and water sectors, with nearly two-thirds of the agency’s portfolio invested in Africa.
- Leverage MCC investments to promote sustainable growth led by the private sector. MCC’s compact programs improve the environment for private business and innovation through significant policy, legal, regulatory and institutional reforms. A vibrant private sector introduces new technologies into and develops innovations for local markets, delivers services, and creates vital employment opportunities, all of which improve the lives and well-being of the poor. These reforms make MCC’s partner countries more attractive to foreign investors, including private firms that can partner with public entities through public-private partnerships (PPPs) to more effectively deliver, operate and maintain much-needed services. Though MCC is small in size, its targeted, evidence-based approach and focus on private sector partnerships multiplies its impact.
- Maintain its posture as a data-driven, evidence-based organization. MCC invests heavily in tracking the results of its investments. All MCC-funded projects are evaluated independently, with nearly 40 percent undergoing rigorous impact evaluations led by third-party evaluators.
- Operate with a lean workforce and small overseas footprint while continuing to innovate and improve administrative functions.
Compacts in Development
|(in millions of $)||FY 2016 Enacted||FY 2017 Enacted||FY 2018 Request|
|Section 609(g) Compact Development Funding (CDF)||23.1|
*CDF amounts are estimated using MCC‘s recent historical average of approximately 4 percent of total compact assistance.
In order to support U.S. global development priorities and maximize the investments available in its candidate pool of poor but relatively well-governed countries, MCC plans to invest $577 million of the FY 2018 request in new compact programs with Mongolia, Senegal, and Sri Lanka.
The funding projections are based on multiple factors, including the size of the countries’ populations and economies, incidences of poverty, absorptive capacities, and need. If fully funded, these investments could significantly advance economic growth and poverty reduction in these important economic and geopolitical partners. As the information provided later in this section details, MCC is actively working with other countries to develop compact programs, including Burkina Faso and Tunisia.
- Mongolia shares the entirety of its southern border with China and its northern border with Russia but represents a strong democratic presence in the region. While the country struggles with limited institutional capacity, Mongolia passed MCC’s scorecard on the basis of its strong policy performance and was selected for FY 2015 as eligible to develop a second compact. Mongolia’s first compact, successfully completed in FY 2013, invested $285 million in multiple sectors. MCC and the Government of Mongolia have agreed to focus the second compact on water supply in the capital city of Ulaanbaatar and have identified potential projects to increase bulk supply and improve service delivery that will require at least $345 million in investments.
- Senegal is a democratic success story in West Africa with stable institutions and successive free, fair elections that led to a peaceful transition of power in 2012. The country’s selection in FY 2016 to develop a second compact reflects its strong policy performance, especially in the areas of battling corruption and protecting political rights. Senegal’s first compact, completed in FY 2015, focused on road rehabilitation and water resource management in isolated agricultural areas, aligning with the country’s long-term objective to enhance economic growth and food security. MCC and the Senegalese are building on these successes through a compact focused on the energy sector. Challenges in this sector continue to impede private agricultural and commercial development. In FY 2017, the Government of Senegal proposed projects that would invest $450 million in energy infrastructure, institutional strengthening, upgrading power transmission and distribution, and improved electricity access in rural areas.
- Sri Lanka marked the end of a significant internal conflict in 2009 and its successful elections in 2015 and improved performance on MCC scorecard’s indicators for political rights and civil liberties enabled the country to graduate from threshold program eligibility to compact eligibility in FY 2017. Despite its progress, Sri Lanka faces continued challenges with post-conflict reconstruction and reconciliation as well as a rapidly urbanizing population that has placed growing strains on its infrastructure. The Government of Sri Lanka has demonstrated a strong commitment to its partnership with MCC by dedicating significant time and effort on the development of its threshold program. Building on this momentum, and with continued high-level government engagement, MCC anticipates accelerated compact development to invest the requested $440 million in high-return projects to address the country’s constraints to growth needs in regional transportation and access to land for commercial and industrial purposes.
The chart below and the subsequent pages provide updates for all of the compacts currently in development, including estimated Board consideration timing and compact sizes. Program and sector data for countries already in implementation can be found online on our public website at www.mcc.gov.
|Countries and Appropriations Used (in millions of $)||Prior Years||FY 2017||FY 2018||Total|
|Board Consideration in FY 2017:|
|Board Consideration in FY 2018:|
|Board Consideration in Future Fiscal Years:|
Compacts in Development as of FY 2017 Q2
|FY 2016||FY 2017||FY 2018||FY 2019|
|Country||Eligibility FY||Projected Signing||Q1||Q2||Q3||Q4||Q1||Q2||Q3||Q4||Q1||Q2||Q3||Q4||Q1||Q2|
|Nepal||2015||10/2017||Project||Project Development||Neg.||Implementation Prep||Implementation|
|Mongolia||2015||4/2018||Project Definition||Project Development||Neg.||Implementation Prep|
|Philippines||2015||1/2019||Project Definition||Project Development|
|Côte d’Ivoire||2016||10/2017||Elig.||Project Definition||Project Development||Neg.||Implementation Prep||Implementation|
|Senegal||2016||10/2018||Elig.||Preliminary Analysis||Project Definition||Project Development||Neg.||Implementation Prep|
|Sri Lanka||2017||10/2018||Elig.||Project Definition||Project Development||Neg.||Implementation Prep|
|Burkina Faso||2017||7/2019||Elig.||Preliminary Analysis||Project Definition||Project Development|
|Tunisia||2017||7/2019||Elig.||Preliminary Analysis||Project Definition||Project Development|
|Lesotho||2014||TBD||MCC’s Board deferred a vote on Lesotho’s continued eligibility in both December 2015 and December 2016 due to ongoing concerns over rule of law and accountability in Lesotho. The Government of Lesotho is working with the Southern Africa Development Community to address the issues driving these concerns, and MCC continues to closely watch their progress.|
With new leadership and an ambitious reform agenda focused on poverty and improved performance on the MCC scorecard, Burkina Faso exemplifies the higher bar that MCC has for second compact countries. Its continued policy improvement is clear: despite being one of the poorest countries in Africa, Burkina Faso passed 13 of the 20 MCC scorecard indicators, has shown strong improvement on democratic rights, and has a consistently strong score on the Control of Corruption indicator. MCC’s Board of Directors selected Burkina Faso in FY 2017 to develop a second compact and a senior MCC team visited Ouagadougou in early February to launch compact development. MCC’s first technical mission, which included consultations with government, civil society, private sector and donor stakeholders, was successfully completed in early May. The Government of Burkina Faso selected a national coordinator and lead economist in April, and should complete the selection of the remaining team members in. Work is underway to complete the constraints to growth analysis by September 2017.
Results of Burkina Faso’s 2009 Compact
MCC’s $480 million compact with Burkina Faso, which ended in July 2014, was characterized by Burkina Faso’s commitment and high-level engagement. All conditions precedent were met; notably many of these required significant institutional reforms and others required adoption of major new laws by the National Assembly and issuance of 52 implementing decrees and regulations. The compact consisted of projects in the sectors of land reform, agriculture, transportation, and education. The compact successfully trained 8,700 local officials in lands rights and over 13,000 land possession certificates were in process by the end of the compact—well over the original target of 6,000. The multifaceted agriculture project constructed 2,240 hectares of irrigated farmland and rehabilitated a dam, protecting investments from catastrophic flooding. MCC funded the paving, upgrade or periodic maintenance of 525 kilometers of roads by the end of the compact term and invested in the development of a new road maintenance planning tool to facilitate future planning and continued management of the country’s road network. The BRIGHT II Schools project built on the education component in the earlier MCC threshold program by investing in the construction of 396 additional classrooms, increasing access to girl-friendly school environments and thereby maintaining girls’ participation in primary school.
Estimated $550 million
After years of working to strengthen their policy performance on MCC’s indicator scorecard through reforms and data updates, Côte D’Ivoire went from passing just five indicators in FY 2013 to passing 14 indicators in FY 2017. MCC has worked with Côte d’Ivoire since FY 2016 to develop a compact program that builds off the economic analysis work already completed for the country’s threshold program, including a constraints to growth analysis and sector diagnostics. Two projects have emerged to address binding constraints in the skills development and transportation sectors. The first project is being designed to improve the employability of Ivoirians and the productivity of the private sector by improving the quality of and access to basic and technical skills in response to private sector demand. The second project will work to increase the competitiveness of Abidjan as the country’s growth pole through road rehabilitation investments to improve the mobility of goods and people along a central corridor in the heart of the city and near the Port of Abidjan. The compact is expected to be presented to MCC’s Board for consideration in late FY 2017.
MCC’s Board deferred a vote on Lesotho’s continued eligibility in both December 2015 and December 2016 due to ongoing concerns over rule of law and accountability. The Government of Lesotho is working with the Southern Africa Development Community to address the issues driving these concerns, and MCC continues to closely watch progress.
Estimated $345 million
MCC’s Board of Directors selected Mongolia for compact assistance in FY 2015 and the Government of Mongolia quickly established a National Secretariat for Compact Development, which completed a constraints to growth analysis that identified costly access to water and sanitation in productive sectors and poor communities as a binding constraint to economic growth. MCC and Mongolia have agreed on a water supply project for Ulaanbaatar as the compact program’s principal focus and identified a set of specific investment activities that will increase bulk water supply and improve service delivery in the water sector, including groundwater extraction, industrial water reuse, and institutional and regulatory policy strengthening. MCC is currently assessing these activities for potential inclusion in a compact and expects to present a compact program to MCC’s Board by mid-FY 2018.
Results of Mongolia’s 2008 Compact
Mongolia completed a $285 million compact program in September 2013. The multi-faceted program included investments in land tenure, health, vocational education, transportation, and energy. The results included improving property rights for small herders by formalizing over 19,000 land titles, establishing the country’s first state-of-the-art medical facility for stroke and heart attack patients, modernizing the vocational education system, constructing a paved 176 km all-weather road to access key trading markets, and the sale of over 100,000 fuel-efficient stoves to reduce air pollution in Ulaanbaatar.
Estimated $498 million
While MCC’s Board of Directors selected Nepal for compact assistance in FY 2015, MCC and the Government of Nepal had been engaging on critical policy and institutional reforms since the country was selected in FY 2012 to develop a threshold program. At that time, MCC and Nepal worked together to complete a constraints to growth analysis that identified the inadequate supply of electricity and the high cost of transportation for goods and services as binding constraints to economic growth. Despite challenges associated with the devastating earthquakes in April and May 2015 and blockage of the Indian-Nepal border that caused severe economic and social hardships, Nepal established a compact development team that worked in a constrained operating environment. The Nepali team submitted proposals focused on large-scale infrastructure investments in the power sector, with a smaller project focused on rehabilitation and maintenance along critical road transport corridors. Having completed feasibility studies and preliminary environmental assessments for the power sector projects, MCC is working closely with the government in considering various options for the final compact program. MCC expects to present Nepal’s compact proposal to the MCC Board before the end of FY 2017.
The MCC’s Board of Directors selected the Philippines as eligible for compact assistance in FY 2015, but, following national elections in May 2016, the Board raised concerns over issues tied to the country’s trajectory on human rights, due process, and rule of law. When the Board made country selection decisions for FY 2017, it deferred the vote on continued compact eligibility for the Philippines. While the Board continues to closely monitor the policy environment, the Government of the Philippines continues developing project proposals on agricultural competitiveness and productivity after a jointly completed a constraints to growth analysis identified four binding constraints to economic growth including 1) government coordination and implementation capacity, 2) the high costs of transport logistics, 3) the high cost of electricity, and 4) market failures in the rural economy. In FY 2016, the Philippines submitted preliminary concepts to MCC that seek to address the fourth constraint, rural market failures, with initial ideas for improving public support programs, raising agricultural productivity, and strengthening the infrastructure that allows access to markets.
Results of the Philippines’ 2010 Compact
The $434 million Philippines 2010 Compact, which concluded in May 2016, improved business processes in the Bureau of Internal Revenue, thereby nearly doubling revenue collections, reducing opportunities for corruption, and supporting increased public investment. The compact program also built over 4,000 small-scale community infrastructure projects which benefited nearly one million households, exceeding the original compact targets. In building these projects to help address communal priorities in a sustainable manner, the compact promoted participation by women. The Secondary National Roads Development Project on Samar Island rehabilitated 222 km of a national road using climate-resilient standards and with significant safety enhancements. The road has reduced transportation costs, expanded commerce, and helped to raise the incomes of the island’s people.
Estimated $450 million
MCC’s Board of Directors selected Senegal for compact assistance in FY 2016. Senegal’s eligibility reflected the country’s strong performance on MCC’s eligibility scorecard, especially on the Control of Corruption and Democratic Rights hard hurdles, showing continuous improvement on Control of Corruption for five straight years, FY 2012 to FY 2017, moving from the 66th to the 96th percentile over that time period. In late FY 2016, MCC and the Government of Senegal completed a constraints to growth analysis that identified the high cost of energy and a distortive business policy environment as binding constraints to economic growth and private investment in Senegal. By mid-FY 2017, MCC and Senegal agreed to focus potential investments on opportunities to reduce the high cost of energy and improve access to electricity. The government submitted concept notes proposing infrastructure improvements, policy and institutional strengthening in the energy sector, transmission and distribution modernization, and improved electricity access in rural areas. MCC expects the Senegal to submit detailed project proposals for further assessment in early FY 2018.
Results of Senegal’s 2009 Compact
The $540 million compact with Senegal was designed to boost economic growth by unlocking the country’s agricultural productivity and expanding access to markets and services through investments in roads and irrigation networks. The two primary compact projects, roads rehabilitation and irrigation and water resource management, were geographically focused in the Senegal River Valley in the north and the Casamance region in the south. The compact priorities aligned with the country’s long-term objectives of enhancing economic growth and food security. This compact program closed in September 2015 with completion of the Irrigation and Water Resource Management Project and most of the Roads Rehabilitation Project. Despite challenges in the early years of program implementation, the Government of Senegal committed the funds needed to complete remaining work on an incomplete road in the Casamance region and is actively managing sustainability efforts for all compact investments going forward.
Estimated $440 million
Sri Lanka passes the FY 2017 MCC scorecard by meeting 13 out of 20 indicators, including the hard hurdles on both Democratic Rights and Control of Corruption. In addition, MCC found Sri Lanka to be a high-capacity and committed partner during development of the threshold program in 2016. Given this strong partnership and policy performance, MCC’s Board moved Sri Lanka from a threshold program into the compact program in FY 2017. Working with MCC, the Government of Sri Lanka developed a constraints to growth analysis in November 2016 that identified binding constraints in policy uncertainty, access to land, and transport. Following Sri Lanka’s selection for compact assistance, an MCC team visited Colombo in January 2017 to launch compact development. Building on the constraints analysis, the government conducted root cause analysis of the binding constraints in March-April 2017 and submitted concept notes for MCC review shortly thereafter.
Tunisia strongly passes MCC’s scorecard, but continues to confront major development challenges such as significant inequality and the vulnerability of many citizens falling back into poverty, all of which undermine recent strong democratic gains. A compact with Tunisia provides MCC with a unique opportunity to partner with a high-capacity partner in a critically important region to develop an investment program and consider policy reforms that would support such investment. MCC’s Board of Directors selected Tunisia for compact assistance in FY 2017. An MCC team visited Tunis in January 2017 to launch compact development. The Government of Tunisia appointed a national coordinator, housed in the Ministry of Development, Investment and International Cooperation, to lead its compact development team. The compact development team has begun to draft an updated constraints to growth analysis, the results of which are expected in summer 2017.
Compact Development Process Overview
|1. Preliminary Analysis||2. Problem Diagnosis||3. Project Definition||4. Project Development||5. Negotiation|
|Constraints Analysis||Concept Notes||Project Proposals||Investment Memo||Compact|
Threshold Programs in Development
|Threshold Programs (in millions of $)||FY 2016 Enacted||FY 2017 Enacted||FY 2018 Request|
MCC’s $26.6 million request for FY 2018 together with enacted funding from prior years would support new threshold programs with Kosovo, Togo, and Timor-Leste.
MCC’s threshold program is a powerful tool assisting promising candidate countries in becoming compact eligible. The threshold program develops robust policy reform and institutional strengthening programs to accelerate the “MCC Effect,” which is often used to refer to the power of MCC’s selection criteria to encourage countries to reform their policies, strengthen their institutions, and improve their data quality to boost their performance on MCC’s scorecard and become eligible for MCC assistance. The threshold program supports better governance in sectors critical to future economic growth and assesses the opportunity for an impactful and cost-effective partnership before committing to a larger compact. MCC uses the same rigorous, evidence-based approach to develop threshold programs as it does in compacts, leading to high-quality investments that maximize systemic impact and lay the foundation for larger investments.
If successfully implemented, these reforms help to reduce constraints to economic growth, increase transparency and accountability, and provide MCC critical information about a candidate country’s political will and capacity to undertake the types of reforms that would have the greatest impact on compacts.
Countries with threshold programs are not guaranteed compact eligibility. However, successful implementation of a threshold program yields significant advantages for a potential future compact. For example, a partner country will likely have enhanced its ability to design and implement investments that will generate the greatest results and have a head start on the work necessary to design a high-impact compact.
Threshold Programs in Development
MCC’s Board selected Kosovo as eligible to develop a compact in December 2015. As a result of a decline in its scorecard performance, particularly on the Control of Corruption indicator, the Board transferred Kosovo to the threshold program in December 2016. Building on the constraints to growth analysis conducted during compact development, the MCC and Kosovo teams are in the final stage of threshold program development. MCC expects to sign an approximately $45 million threshold program agreement during FY 2017. The program will support projects to incentivize energy efficiency and to foster more transparent and accountable governance data. The Board is expected to consider this program in FY 2017.
The Board selected Togo as a threshold country in December 2015. Togo has shown consistent improvements on the MCC scorecard over the past four years. As a result of a dedicated reform effort, Togo moved from passing 5 of 20 indicators in FY 2014 to 12 of 20 indicators in FY 2017, including the Control of Corruption indicator. MCC and the Government of Togo have worked closely to conduct a constraints analysis and are currently developing projects to support reforms in the information and communications technology (ICT) sector and to improve land rights and administration. MCC expects to sign the threshold program agreement in early FY 2018.
Timor-Leste was selected for the Threshold Program in December 2016 and MCC is working with the government on an analysis of Timor-Leste’s constraints to economic growth. The Timorese are committed to the new partnership and with the strong support of the U.S. Embassy and USAID, MCC is seeking to develop an economic reform program after the parliamentary elections in July of 2017. MCC expects to conclude development and sign an agreement by the end of FY 2018.
Current Threshold Programs
MCC and the Government of Honduras signed a $15.6 million threshold program agreement in August 2013 to enhance the transparency and efficiency of public financial management, procurement, audit, and oversight of public-private partnerships. In January 2017, the government launched a procurement certification program aimed at improving the transparency, accountability, and quality of public procurement by building the capacity of civil servants and requiring that all procurements above a threshold be managed by certified procurement professionals.
MCC and the Government of Guatemala are partnering to implement a $28 million threshold program. Signed in April 2015, the program is designed to improve the quality of secondary education. In order to increase government spending in social services like education, MCC is also working with Guatemala to mobilize financial resources through reforms in customs and tax administration and by attracting private capital and structuring public-private partnerships for infrastructure.
In November 2015, MCC and the Republic of Sierra Leone signed a $44 million threshold program agreement to support policy reforms and improved governance in the water and electricity sectors. By establishing independent regulation, strengthening key institutions, and increasing transparency and accountability, the program will create a foundation for delivery of financially sustainable water and electricity services to the people of Sierra Leone, and limit opportunities for corruption in service delivery.
Compact Development and Oversight
|Compact Development and Oversight (in millions of $)||FY 2016 Enacted||FY 2017 Enacted||FY 2018 Request|
For FY 2018, MCC is budgeting $27 million for assistance under section 609(g) of MCC’s authorizing statute. In addition, MCC is budgeting $63 million for due diligence to support programmatic oversight, quality control, and post-completion work, such as data collection and evaluation. A detailed focus on pre-compact planning, program oversight, and post-compact evaluation is critical to the success of MCC program investments and to ensuring that MCC, its partner countries, and the development community are able to take advantage of the learning opportunities inherent in MCC programs.
Specifically, the higher funding level for 609(g) assistance will be used to facilitate the development and implementation of compact programs with existing partner countries, as well as with new partner countries selected in FY 2017: Burkina Faso, Sri Lanka and Tunisia. Due diligence funding will be used for oversight and monitoring of compacts in implementation, the number of which is anticipated to grow in FY 2017 and 2018, and for monitoring and evaluation activities around the closeout of compact programs in Cabo Verde and Indonesia in FY 2018. Due diligence funding will also support MCC’s oversight of threshold programs in implementation and the development of threshold programs with new partners selected in FY 2017—Kosovo, Togo, and Timor-Leste.
Assistance provided under section 609(g) of MCC’s authorizing statute represents less than 4 percent of MCC’s overall request. Nonetheless, 609(g) assistance is critical to the success of compact development and allows MCC to fulfill its goal of developing high-quality compacts more quickly. MCC 609(g) assistance grants help its country partners undertake detailed project preparation work on proposed projects. This preparation includes project design studies, feasibility studies, environmental impact assessments, engineering and geotechnical designs, economic baseline surveys, technical assessments of financial management and procurement capabilities, and other specialized analyses that help partner countries fully prepare projects that can be implemented within the fixed five-year timeframe, within budget, and provide substantial returns to MCC’s investment.
Due diligence funds allow MCC to obtain the information necessary to evaluate, assess, and appraise proposed projects during compact development, to effectively oversee and monitor projects during compact implementation, and to evaluate the results of compact projects after compact close-out.
MCC uses due diligence funds to procure consultants and technical experts who can provide this kind of support. By allowing MCC to procure such resources as needed, rather than permanently hire full-time technical staff, due diligence funds allow MCC to operate on a lean administrative budget relative to the size and diversity of its investment portfolio.
Due diligence funds support MCC’s independent impact evaluations that use rigorous statistical methods to measure changes in beneficiary income related to MCC activities. In addition to offering valuable lessons on how MCC can improve, impact evaluations provide encouraging news about program successes.
Due diligence funds also support data and technical expertise needed for calculating economic rates of return for compact investments. Through pre-investment economic modeling of expected economic rates of return, MCC chooses which investments are most likely to generate benefits, specifically, increased income for program beneficiaries. Economic modeling done after compact closeout helps to assess the cost effectiveness of the agency’s investments.
|(in millions of $)||FY 2016
|Total Administrative Expenses||105.0||105.0||102.4|
|Rent, Leasehold & Improvements||4.5||3.8||6.0|
|Other Administrative Expenses||0.6||0.7||0.5|
MCC is projecting up to $102.4 million in FY 2018 administrative expenses to support its agency operations and lean workforce of just over 300 Full Time Employees (FTE). Learning from experience is engrained in MCC’s culture, and as such, the agency continually assesses the efficiency and effectiveness of not only its program funding but also its administrative expenses.
In this spirit, and in alignment with MCC’s strategic goals, MCC launched an effort in FY 2016 to enhance the efficiency and productivity of the agency and its workforce. Focused on enabling productive and efficient decision-making and executing strong workforce planning and performance management, the effort has MCC well-positioned to meet the Administration’s desire for a lean, accountable, and more efficient government. In FY 2017 and FY 2018, MCC will implement major efficiency efforts and make related investments to improve knowledge management and performance management systems and practices, while continuing to seek cost-savings through strategic IT and related investments.
MCC is budgeting $55 million for human capital expenditures, a modest increase above the FY 2017 level to account for the government-wide civilian pay raise, while projecting a small decrease in the agency’s planned FTE count. MCC looks across its entire human capital and contracted services portfolio (FTEs, personal service contractors, and service contractors) with the intent to right-size the human capital budget while utilizing the most appropriate hiring authorities to maximize efficiencies.
MCC also continues to make strategic investments to better manage these human capital resources. MCC’s implementation of a new performance management system in FY 2017 to support evaluation of FTEs is one example of the steps taken to maximize employee performance and accountability. As a complement to this effort, in FY 2018 MCC plans to roll out a new workforce planning and management system to inform strategic staffing decisions and ensure human capital resources are consistently directed to highest-priority needs. MCC is also undertaking an effort to refine its knowledge management system and business processes, which will allow the agency to strengthen program quality and impact, expedite problem solving through efficient access to needed knowledge, enhance onboarding practices, institutionalize agency learning, and develop programs faster, all of which will help to decrease costs and increase efficiency.
MCC is budgeting $8.5 million to support its overseas administrative operations. This budget will support an overall in-country presence for 20 compacts and threshold programs during FYs 2017 and 2018. Overseas operations costs for each country include salaries and benefits, rent, residential allowance, relocation expenses, travel, shipping, office and residential furniture, IT equipment, official vehicles, and International Cooperative Administrative Support Services (ICASS) costs for a small in-country footprint of U.S. and locally employed personnel. Although the agency plans to manage direct overseas support costs at a lower level, MCC may continue to face upward pressure associated with ICASS and Capital Security Cost-Sharing (CSCS) as changes in country mission sizes, as well as other initiatives the Department of State requires to maintain and operate embassy compounds and therefore force greater burden sharing.
As a small, independent agency, MCC continually looks for opportunities to save resources and time by leveraging shared systems and services offered by other federal agencies or other providers—like procurement, financial management and accounting systems. For example, in FY 2017 and FY 2018, MCC is integrating a new contract management system, Contract Lifecycle Management System (CLMS), into its financial management system through the agency’s partnership with the Department of the Interior. This integration will save employees time, and the agency will reduce the risk of errors when transferring contract data. Over the next 10 years, it is anticipated that the CLMS investment will save the agency approximately $2 million in comparison to procuring or building a standalone system, while also ensuring MCC satisfies outstanding audit concerns. Similarly, in FY 2017, MCC migrated its IT server infrastructure to a cloud service provider, which is anticipated to save the agency $6 million over the next 10 years. MCC continues to use these savings to fund additional capital investments in software systems to automate core agency business processes (e.g. annual selection database, quarterly compact reporting system, compact performance data analytics, employee performance planning and evaluation).
As part of reducing MCC’s footprint, the agency successfully moved headquarters staff into a new property in FY 2016 and, as part of the negotiated lease, experienced the benefit of no lease payments for a portion of FY 2016 and 2017. However, MCC is expected to pay for a full year rent obligation of $6 million at the new headquarters location for the first time during FY 2018.
Office of the Inspector General
|(in millions of $)||FY 2016
|FY 2017 Enacted||FY 2018
|Office of the Inspector General||5.0||5.0||4.5|
The Office of the Inspector General is requesting $4.5 million for audit expenses in FY 2018.
The USAID Office of the Inspector General will continue to conduct financial and performance audits and reviews of MCC and Millennium Challenge Account entity activities, as well as oversee and review MCC‘s annual external audit.
Proposed Legislative Changes
Using Concurrent MCC Compacts to Advance Regional Economic Integration
MCC is seeking to change the Millennium Challenge Act of 2003, as amended, to allow for concurrent compact authority in order to maximize the economic impact of its work through regional investments. After more than 13 years of successfully delivering large, complex infrastructure projects coupled with supporting difficult policy reforms in partner countries, MCC is well-positioned to increase the impact of its investments by focusing regionally in some cases.
Concurrent compacts would allow MCC to complement its proven country-focused model with the ability to develop regionally oriented investments. MCC will be able to simultaneously research and work with multiple eligible countries in a region to identify, negotiate, and eventually fund investments that would have a positive economic impact for each country involved as well as the region. By making coordinated investments across multiple countries to expand existing infrastructure, MCC will be able to help partners work together to build and grow regional markets, facilitate trade, and foster greater impact through economies of scale. This, in turn, will help generate new business and market opportunities for U.S. and other companies by making it cheaper, easier, and faster for businesses to get their products to new, emerging regional markets.
At present, MCC has the authority to sign and implement only one compact at a time with any given partner country. As a result, MCC cannot move forward on multi-country investments to advance regional economic integration. This is especially true in places where MCC is heavily invested, such as Africa—with its 54 countries, no economies of scale—and in sectors such as infrastructure, where MCC has invested 70 percent of its more than $11 billion dollar portfolio. For instance, in December 2015, MCC selected Côte d’Ivoire as eligible to develop a compact. Several existing MCC compact partners are neighbors of Côte d’Ivoire, including Burkina Faso, Ghana, and Liberia. The ability to sign concurrent compacts would enable MCC to improve trade and investment between and among these MCC partner countries by promoting cross-border engagement, and thereby economic growth.
The authority MCC is seeking would allow the agency to maintain its focused, data-driven model for country and project selection. Projects will still be required to undergo a rigorous economic analysis and have an economic rate of return that ensures the program logic is geared toward a measurable impact on poverty. Regional investments will employ MCC’s local implementation and accountability, allowing for multiple bilateral compacts to be knitted together into a regional project. Concurrent compact authority will allow MCC to develop regional projects while still adhering to the agency’s important country-owned processes that demand accountability and the core elements of MCC’s operational model to produce high returns on investments. In any regional investment, MCC would continue its:
- Transparent process for selecting the best-governed poor countries. Selection of regional investments would be based upon the existing country selection system; countries selected by the Board as eligible for bilateral compacts would also be eligible for regional investments.
- Use of economic analysis to choose investments. Regional investments would be selected based on economic analysis of project returns. The preliminary economic rates of return (ERRs) will need to show returns above MCC’s hurdle rate, five-year timeline feasibility, manageable environmental and social risks, implementation of policy and institutional reforms, private sector engagement, and sustainability.
- Commitment to suspend or terminate investments when appropriate. MCC recognizes that one of the risks inherent in regional investments is that one or more of the countries involved in the partnership may not perform well or may suffer governance declines inconsistent with continued MCC engagement. MCC is committed to suspend or terminate regional investments as appropriate, just as it is with bilateral investments.
The text of the proposed statutory change is as follows:
SEC. X. MILLENNIUM CHALLENGE COMPACT
- IN GENERAL.—Section 609 of the Millennium Challenge Act of 2003 (22 U.S.C. 7708) is amended—
- in subsection (k), by striking the first sentence;
- by redesignating subsection (k) as subsection (l); and
- (3) by inserting after subsection (j) the following:
“(k) CONCURRENT COMPACTS.—An eligible country that has entered into and has in effect a Compact under this section may enter into and have in effect at the same time not more than one additional Compact in accordance with the requirements under this title if—
- one or both of the Compacts are or will be for the purposes of regional economic integration, increased regional trade, or cross-border collaborations; and
- the Board determines that the country is making considerable and demonstrable progress in implementing the terms of the existing Compact and supplementary agreements thereto.”.
- CONFORMING AMENDMENT.—Section 613(b)(2)(a) of such Act (22 U.S.C. 7712(b)(2)(A)) is amended by striking “the” before “Compact” and inserting “any”.
- APPLICABILITY.—The amendments made by this section shall apply with respect to Compacts entered into between the United States and an eligible country under the Millennium Challenge Act of 2003 before, on, or after the date of the enactment of this Act.
Appendix: Annual Performance Report
|Partner Country||Compact Amount||Signing||Entry Into Force||Closed Dates|
|Cabo Verde, 2012||66.2||2/10/2012||11/30/2012|
|El Salvador, 2014||277.0||9/30/2014||9/9/2015|
*Please note that the values above are the signed compact amounts and do not reflect lower actual expenditures due to early terminations or funds for a compact not being fully spent. The table on the next page reflects the net obligations/commitments associated with each compact.
Compact Obligations and Commitments $ in millions
|Compact||2010 & Prior||2011||2012||2013||2014||2015||2016||2017||2018||Total|
Threshold Program Agreements Signing Amounts (in millions of $)
|Country||Sub-Saharan Africa||Eurasia||Latin America||Middle East and North Africa||Signing Date||Completion Date|
|São Tomé & Principe||8.7||11/9/2007||4/15/2011|
|Sierra Leone||44.4||11/17/2015||In progress|
Results of Recently Closed Compacts
Jordan is one of the most water-scarce countries in the world, and severe water shortages constrain economic opportunities and impact daily life. MCC’s Jordan Compact invested $275 million to boost income and reduce poverty in Zarqa Governorate by increasing the supply of water available to households and businesses and improvements in the efficiency of water delivery, wastewater collection and wastewater treatment.
|Outputs||Water Network Project
Wastewater Network Project
As-Samra Wastewater Treatment Plant Expansion Project
|Preliminary and Expected Outcomes||
|Evaluations||Water & Wastewater Network Projects
The $434 million Philippines Compact sought to support reforms and investments to modernize the Bureau of Internal Revenue to increase fiscal space for public investment and reduce opportunities for corruption in tax administration as well as expand and enhance a community-driven development project to empower communities and encourage economic growth through small-scale infrastructure projects, and, finally, rehabilitate a secondary national road connecting the provinces of Samar and Eastern Samar, two of the poorest regions of the country.
|Policy Reforms||Revenue Administration Reform Project
Secondary National Roads Development Project
|Outputs||Revenue Administration Reform Project
Secondary National Roads Development Project
|Preliminary and Expected Outcomes||Revenue Administration Reform Project
Secondary National Roads Development Project
|Evaluations||Revenue Administration Reform Project
Secondary National Roads Development Project
MCC employs a risk-based approach to the management of its portfolio and uses a number of mechanisms to manage projects that face potential major modifications, including:
- Quarterly portfolio reviews of all compacts, with a focus on high-risk projects and activities;
- Early identification of high-risk projects;
- Close collaboration with partner countries to develop plans to prevent, mitigate and manage project restructuring; and
- Approval of modifications at the appropriate level.
MCC also conducts due diligence on programs in advance of compact signing to increase the reliability of technical, cost, and other estimates. During compact development, MCC makes project design modifications to mitigate potential completion risk, currency fluctuations and the potential for construction cost overruns.
|Indonesia||Green Prosperity Project / Green Prosperity Facility Activity ($242 million)||Reallocation of $37.9 million of funding from the Green Prosperity Facility for other compact uses, in response to the change of activities in the Facility||Grantee intake for the GP Facility ended in early 2016. With less than two years remaining to implement activities funded by the GP Facility, MCA-Indonesia determined that no further intake could occur without compromising the quality of activities or possible completion risk. As a result, excess funding in the GP Facility ($37.9 million) was reallocated from the GP Facility to the Community Based Nutrition Project ($4.7 million), the Procurement Modernization Project ($15.1 million), and within the PLUP Activity ($18.1 million).To comply with the compact, the PLUP Activity now covers a total of 45 districts rather than the original 26 districts. An additional $16.6 million was reallocated to finance the expansion of the PLUP Activity and $1.5 million was reallocated to mapping peatland hydrology in four priority districts in partnership with Indonesia’s Peatland Restoration Agency.
Under the Procurement Professionalization Activity, MCC is developing specialized training modules for the ministries of Public Works, Transportation, and Finance. The reallocation expanded the reach of the project, framework contracting and procurement management information system sub-activities for the ministries.
Estimating Compact Beneficiaries and Benefits
Under MCC’s results framework, beneficiaries are defined as an individual and all members of his or her household who will experience an income gain as a result of MCC interventions. We consider that the entire household will benefit from the income gain and counts are multiplied by the average household size in the area or country. The beneficiary standard makes a distinction between individuals participating in a project and individuals expected to increase their income as a result of the project. Before signing a compact, MCC estimates the expected long-term income gains through a rigorous benefit-cost analysis. MCC may reassess and modify its beneficiary estimates and/or the present value of benefits when project designs change during implementation.
|Compact 1 2||Estimated Number of Beneficiaries||Estimated Long Term Income Gain Over the Life of the Project (PV of Benefits) 3|
|Cape Verde 2005||385,000||$149,300,000|
|Cape Verde 2012||604,000||$112,900,000|
|El Salvador 2006||706,000||$377,800,000|
|El Salvador 2014||6,446,000||$224,500,000|
|Total for All Compacts 5||180,754,000||$10,468,000,000|
Portfolio by Sector
Investments by Sector
|Sector||Amount ($ Millions)|
|Transportation (Road, Water & Air)||$2,992.1|
|Health, Education & Community Services||$1,673.5|
|Water Supply & Sanitation||$1,088.6|
|Program Administration & Monitoring||$1,201.0|
Results by Sector
|Sector||Indicator||Total Portfolio Actuals (cumulative value 2005-present)||Data Points (number of compacts)||Active and Completed Countries Tracked (underlined indicates still active)|
|Roads||Temporary employment generated in road construction||49,822||6||Armenia, Burkina Faso, Cabo Verde, El Salvador, El Salvador II, Georgia, Ghana, Honduras, Mali, Moldova, Mongolia, Mozambique, Nicaragua, Philippines, Senegal, Tanzania, Vanuatu|
|Kilometers of roads completed||3,035||15|
|Agriculture & Irrigation||Farmers trained||309,997||14||Armenia, Burkina Faso, Cabo Verde, El Salvador, Georgia, Ghana, Honduras, Indonesia, Madagascar, Mali, Moldova, Morocco, Mozambique, Namibia, Nicaragua, Senegal|
|Farmers who have applied improved practices as a result of training||126,592||10|
|Hectares under improved irrigation||203,963||8|
|Value of agricultural and rural loans||$87,074,694||9|
|Water & Sanitation||Temporary employment generated in water and sanitation construction||21,241||6||Cabo Verde II, El Salvador, Georgia, Ghana, Jordan, Lesotho, Mozambique, Tanzania, Zambia|
|People trained in hygiene and sanitary best practices||12,135||6|
|Water points constructed||1,181||3|
|Operating cost coverage||104%||3|
|Access to improved water supply||53%||2|
|Education||Students participating||215,399||7||Burkina Faso, El Salvador, El Salvador II, Georgia II, Ghana, Mongolia, Morocco, Namibia|
|Graduates from MCC-supported education activities||62,211||5|
|Land||Legal and regulatory reforms adopted||123||7||Benin, Burkina Faso, Cabo Verde II, Ghana, Indonesia, Lesotho, Madagascar, Mali, Mongolia, Mozambique, Namibia, Nicaragua, Senegal|
|Land administration offices established or upgraded||384||8|
|Parcels corrected or incorporated in land system||329,659||8|
|Land rights formalized||312,381||7|
|Power||Kilometers of lines completed||4,294||3||El Salvador, Georgia, Ghana, Ghana II, Indonesia, Liberia, Malawi, Mongolia, Tanzania|
Sector Results at a Glance
Numbers are cumulative since the agency’s founding in 2004 and current as of March 2017.
Once a country is selected as eligible to develop a compact or threshold program, the first step in MCC’s process is to work with partner country officials to conduct a rigorous, joint analysis that identifies the most binding constraints to economic growth. These results help prioritize MCC’s investments in the areas that are the biggest impediments to private investment and poverty reduction and may include access to credit, governance, electricity, transportation or education. Constraints to growth are different for each country and ultimately drive MCC’s investment strategy. Below are highlights of MCC’s sector investments that have emerged from this analysis.
2,668 miles of electricity lines completed
MCC is making major investments in the energy sector to reduce energy poverty in Benin, Ghana, Liberia, Malawi and Sierra Leone, while encouraging power sector reforms that complement infrastructure investments. In Liberia, MCC’s compact funds the rehabilitation of a hydropower facility to increase the amount of generated electricity, facilitate lower overall electricity rates, and increase the reliability and adequacy of electricity. In Ghana, the government took significant steps to revitalize its power sector by inviting the private sector to invest in its national utility. Preparation for implementing a compact with Benin continues while significant construction works for large-scale, on-grid generation, transmission and distribution projects are underway in Malawi, as well as smaller-scale, on- and off-grid energy projects in Indonesia. In Sierra Leone, MCC began carrying out its threshold program to build the capacity of the newly established power regulator and power generation and transmission utility.
3,035 miles of roads completed
3,918 additional miles of roadway under construction
In May 2016, the Philippines, using MCC compact funding, successfully completed the reconstruction/rehabilitation of 174.95 kilometers of a road in the Samar and Eastern Samar provinces of the country that will help lower transport costs and travel time and opens up possibilities for new markets. For the Niger Compact, investments were prepared for the upgrading of 307 km (191 miles) of roads to international standards, and enhancement of both national and regional connectivity. Implementation of technical assistance and policy reform activities that would set Liberia on a long-term path to a sustainable road maintenance were started.
Water and Sanitation
7,401,563 estimated beneficiaries of improved water and sanitation services.
MCC supports capital improvements and policy and institutional reforms to improve the level and quality of water and sanitation services in partner countries. MCC’s five year compact with Jordan, for example, closed in FY 2016 after investing more than $200 million for rehabilitation and construction of water supply and wastewater infrastructure including investment in the As-Samra wastewater treatment plant where treated effluent will be diverted for agricultural use saving precious bulk water supply for this water poor nation. MCC’s compact investment in Zambia is strengthening the main water utility company to improve billings and collections and provide more reliable service to its customers. In Sierra Leone, MCC is partnering with the government on a threshold program to implement policy reforms, build institutional capacity and improve governance in the water sector in Freetown. A comprehensive assessment of the water utility in Guma Valley was conducted to determine the priority areas of assistance for strengthening utility performance but because a cost-benefit analysis is not required for threshold program assistance, the estimated number of beneficiaries above does not include the Sierra Leone beneficiaries.
Agriculture and Irrigation
309,997 farmers trained
504,004 acres under improved irrigation
In July 2016, MCC signed a $437 million compact with Niger focused on strengthening the agricultural sector. Through the compact’s Irrigation and the Market Access Project, MCC will work with the Government of Niger to improve irrigation, including the rehabilitation and development of three large-scale irrigation systems in the Dosso and Tahoua regions, to increase crop yields, sustainable fishing and livestock productivity. In addition, the project will reform policies and institutions, including the establishment of a national water resource management plan and natural resource and land use management plans, and create local capacities to increase understanding of best-practices to sustainably use and maintain irrigation and market infrastructure.
312,381 household, commercial, and legal entities gained protected land rights
MCC works with partner countries to improve land governance and administration, strengthen property rights, and stimulate private-sector investment for more productive land use. In Cabo Verde, MCC has invested to reduce the time required to register property rights and establish more conclusive land records in areas with high development potential. MCC funding was used under a pilot activity to complete surveys for 100 percent of land parcels on the island of Sal, which are now being registered. This activity led to the passage of a legal amendment in August 2016 that streamlined the land survey and registration process. MCC is now funding the survey and registration of an additional 22,824 parcels on the islands of Boa Vista, Maio, and Sao Vicente. In Indonesia, MCC’s investment in natural resource management and renewable energy includes development of a methodology for community-based participatory mapping of village boundaries and cultural and natural resources. Following this methodology, villages are able to produce legally recognized village maps to enhance land use plans. As of September 30, 2016, MCC funding had assisted 114 communities in defining and demarcating the boundaries of their villages. Land and natural resource information systems were being installed in government offices in 35 districts across 10 provinces to provide decision-makers with the information they need to encourage investment while effectively supporting the management of their land and other natural resources.
758 education facilities constructed or rehabilitated
4,459 instructors trained
215,399 students participating in MCC-supported education activities
MCC works with partner countries to ensure that students obtain the knowledge and skills demanded by the private sector. In FY 2016, El Salvador officially announced its commitment to reform the technical and vocational education and training (TVET) system, identifying four transformative industries to target. The Salvadorians are establishing Skills Sector Committees for each of these four industries to define demand-driven training programs to feed into the overall technical and vocational educating training system. In Georgia, 12 schools have been completed, with another 16 on track to be completed by December 2017 and hundreds of students will be able to move into highly improved learning environments. Also in Georgia, more than 400 people were trained and certified as trainers to conduct the first of a Leadership Academy series for school principals, and in turn, they have trained more than 1,600 principals. The MCA-Georgia TVET Facility has awarded its first round of grants totaling approximately $12 million, slated to be disbursed in 2017. In September 2016, construction tenders were successfully launched for rehabilitation of pilot schools for MCC’s Morocco Compact. Also in Morocco, preparations are underway to field test an innovative Integrated School Improvement Model that will eventually be implemented in approximately 100 secondary schools, and planning advanced significantly for a TVET Grant Facility as well as a results-based financing component of the compact that aims to improve job placement for women and at-risk youth. Further, the Guatemala threshold program now includes a TVET component.
1,506 health providers trained on growth monitoring
3,866 service providers trained on community-led total sanitation triggering
11,832 service providers trained on infant and young child feeding
MCC works with partner countries to integrate sanitation, maternal and child health, and nutrition interventions to reduce stunting and increase household income. In Indonesia, MCC has committed more than $130 million to improve nutrition and health. MCC’s Indonesia Compact includes a partnership with the World Bank using incentives-based community grants to increase the demand for health, nutrition and education services and improves the health sector’s capacity to respond to increased demand at the facility and community level. In Sierra Leone, MCC has committed $5 million to improve access to reliable and safe water and sanitation (WASH) services, and to promote WASH practices at the household level. Increased access to safe drinking water, food, and sanitation services is critical to improving children’s nutritional status and preventing environmental enteropathy, which has been associated with growth failure in children.
Agriculture and Irrigation (all common indicators data as of March 10, 2017)
|Process Indicators||Output Indicators||Outcome Indicators|
$ Value of signed irrigation feasibility and design contracts
% disbursed of irrigation feasibility and design contracts
Value of signed irrigation construction contracts (USD)
% disbursed of irrigation construction contracts
|(AI-5) Temporary employment generated in irrigation||(AI-6)
|(AI-7) Enterprises assisted||(AI-8)
Hectares under improved irrigation
Value of agricultural and rural loans (USD)
|(AI-11) Farmers who applied improved practices as a result of training||(AI-12) Hectares under improved practices as a result of training||(AI-13) Enterprises that have applied improved techniques|
|Cabo Verde I||–||–||5,167,848||97.6%||–||553||–||13||–||617,000||106||–||–|
*Europe, Asia, Pacific, Latin America
**Gender totals may not match overall totals due to lack of gender counting in earlier compacts (applies to all common indicator tables).
Data are preliminary and subject to adjustment. Grey shading indicates close-out compacts; data revision is not expected for these compacts. Indicators in this Results Framework may be added, removed, or modified as MCC’s investments in education evolve over time. All MCC education programs have as their long-term end goal an increase in individual or household income and a corresponding decrease in poverty (applies to all common indicator tables).
|Process Indicators||Output Indicators||Outcome Indicators|
Value of signed educational facility construction, rehabilitation, and equipping contracts (USD)
Percent disbursed of educational facility construction, rehabilitation, and equipping contracts
Legal, financial, and policy reforms adopted
|(E-4) Educational facilities constructed or rehabilitated||(E-5) Instructors trained||(E-6)
Students participating in MCC-supported education activities
|(E-7) Graduates from MCC-supported education activities||(E-8)
Employed graduates of MCC-supported education activities
|El Salvador I||EAPLA||9,857,585||99.8%||–||22||378||30,672||4,285||–|
|El Salvador II||–||–||–||–||–||–||–||–|
*Number decreased due to the negative value of the variation orders.
|Output Indicators||Outcome Indicators|
Legal and regulatory reforms adopted
Land administration offices established or upgraded
|(L-3) Stakeholders trained||(L-4)
Conflicts successfully mediated
Parcels corrected or incorporated in land system
Land rights formalized
|(L-7) Percentage change in time for property transactions||(L-8) Percentage change in cost for property transactions|
|Cabo Verde II||25||23||435||–||14,179||596||–||–|
|Process Indicators||Output Indicators|
|Country||Region||(P-1) Value of signed power infrastructure feasibility and design contracts||(P-2) Percent disbursed of power infrastructure feasibility and design contracts||(P-3) Value of signed power infrastructure construction contracts||(P-4) Percent disbursed of power infrastructure construction contracts||(P-5) Temporary employment generated in power infrastructure construction||(P-6) Generation capacity added||(P-7 and P-10) Km lines upgraded or built||(P-8) Transmission throughput capacity added||(P-9 and P-11) Substation capacity added||(P-12) Customers added by project||(P-13) Maintenance expenditure-asset value ratio||(P-14) Cost-reflective tariff regime|
|Country||Region||(P-15) Total electricity supply||(P-16) Power plant availability||(P-17) Installed generation capacity||(P-18) Transmission system technical losses (%)||(P-19) Distribution system losses||(P-20) Commercial losses||(P-21) System Average Interruption Duration Index (SAIDI)||(P-22) System Average Interruption Frequency Index (SAIFI)||(P-23) Total electricity sold||(P-24)
Operating cost-recovery ratio
|(P-25) Percentage of households connected to the national grid||(P-26) Share of renewable energy in the country|
|Process Indicators||Outputs||Outcome Indicators|
Value of signed road feasibility and design contracts
% road feasibility & design contracts disbursed
|(R-3) Kilometers of roads under design||(R-4)
Value of signed road construction contracts
Percent disbursed of road construction contracts
|(R-6) Kilometers of roads under works contracts||(R-7) Temporary employment generated in road construction||(R-8)
Kilometers of roads completed
Average annual daily traffic
Road traffic fatalities
|El Salvador I||18,321,410||99%||223||248,378,825||97%||223.0||–||223.32||–||–||–|
|El Salvador II||–||–||32||–||–||–||–||–||–||–||–|
|Cape Verde I||3,520,000||92%||63||24,280,000||100%||40.6||–||40.60||2.00||–|
Water Supply, Sanitation, and Hygiene
|Process Indicators||Output Indicators|
Value of signed water and sanitation feasibility and design contracts (USD)
Percent disbursed of water and sanitation feasibility and design contracts
Value of signed water and sanitation construction contracts (USD)
Percent disbursed of water and sanitation construction contracts
|(WS-5) Temporary employment generated in water and sanitation construction||(WS-6)
People trained in hygiene and sanitary best practices
Water points constructed
|Cabo Verde II||AFRICA||730,419||71.8%||17,207,069||48.9%||1115||32||–|
Water Supply, Sanitation, and Hygiene (continued)
Non revenue water
|(WS-9) Continuity of service||(WS-10) Operating cost coverage||(WS-11)
Volume of water produced*
|Residential population connected to sewer system*||Residential population*||(WS-12) Access to improved water supply||(WS-13) Access to improved sanitation||(WS-14) Residential water consumption*||(WS-15) Industrial/Commercial water consumption*||(WS-16) Incidence of diarrhea*|
|Cabo Verde II||AFRICA||–||–||–||–||–||–||–||–||20.0||–|
*This is a monitoring indicator; any change over baseline data represents the current trend and does not represent the direct impact of MCC investment.
FY 2017 Corporate Priorities
For FY 2017, MCC management established seven specific priorities to guide agency planning and performance for the year. These goals are intended to advance and deliver high quality programs, improve organizational health and effectiveness, and set MCC up for long term success. As in past years, these corporate priorities are the starting point for annual department and division goal-setting, from which staff develop their individual performance plans. Below you will find MCC’s FY 2017 corporate priorities with a brief description of MCC’s progress to date.
|Advance and deliver high‐quality compacts in a timely manner.||As described above, MCC is on target to present compact programs for Nepal and Cote d’Ivoire to MCC’s Board of Directors for approval in FY 2017, and has maintained progress on development of Mongolia, Senegal, and Sri Lanka compacts to facilitate success in FY 2018.|
|Effectively oversee compacts in implementation.||Key indicators for compact implementation are on track, with entry into force anticipated for the Benin and Morocco compacts in FY 2017. Additionally, a successful close out in Jordan, and planning for compact closure in Cabo Verde is currently underway.|
|Advance and deliver high‐quality threshold programs in a timely manner and effectively oversee programs in implementation.||Programs for Kosovo and Togo are anticipated to be presented to MCC’s Board in FY 2017, with implementation on track in Honduras, Guatemala and Sierra Leone.|
|Develop a strong and dynamic knowledge management system, set of business practices, and tools to systematically share and deploy learning and results internally and externally.||MCC recently initiated an assessment of the agency’s knowledge management practices, which is scheduled to be completed by the end of FY 2017.|
|Develop and deploy corporate risk and portfolio management tools to inform resource allocation and strategic decisions.||In accordance with OMB Circular A-123, MCC’s Chief Risk Officer is leading preparation of MCC’s risk profile, with the support of a recently established internal risk committee. The risk profile is on track to be delivered in FY 2017.|
|Enable transparent and efficient decision-making and integrate MCC CLEAR values and norms into daily operations to facilitate program success and strengthen organizational health.||MCC initiated a new Executive Decision Group to make decision making more efficient and transparent. The agency also developed new compact development guidelines and refined MCC’s investment criteria to provide technical teams and our country partners with clear standards and more timely guidance from management.|
|Strengthen and motivate agency workforce through data‐driven workforce planning, consistent performance expectations, and improved performance management systems d feedback.||MCC initiated implementation of a new performance management system, including standardization of performance expectations and new business practices for employee feedback and oversight. Ongoing workforce planning efforts will be incorporated into MCC’s agency reform plan, in accordance with OMB guidance.|