U.S. development dollars through MCC are delivering real value by maximizing cost-effective, strategic leveraging opportunities with an array of partners. We are cementing efficiencies by looking for ways to leverage our own comparative advantages and those of others in the private sector, across the U.S. Government and throughout the donor community. During this past fiscal year, shared values and interests built coalitions for reform and results. Read how.
Partnering with the Private Sector
Promoting our Interests
“… Difficult budget times at home and times of challenge overseas … require[s] new and creative partnerships. We have to leverage private sector leadership more dramatically than at any time in our history. We need a new collaboration that reaches beyond government to include business and civil society groups working together to promote economic growth.”Secretary of State and Chair of MCC’s Board of Directors John Kerry,
Press Statement at Meeting with Partners for a New Beginning,
May 3, 2013
In our interdependent global economy, prosperity is shared. So helping the world’s poor means not only jumpstarting local private sector activity but also helping the U.S. economy. Investing in the markets of tomorrow creates new investment and business opportunities for local and regional trade as well as American companies. MCC is paying it forward by creating enabling environments throughout the developing world where private enterprise flourishes and the American private sector can partner, compete, succeed, and bring key benefits—like jobs—back home. See how the private sector worked with MCC during this past fiscal year:
- In June 2013, General Electric signed a memorandum of understanding with the Government of Ghana to construct a 1,000-megawatt power generation plant. MCC’s ongoing support for a strong policy and regulatory framework for Ghana’s power sector, as part of efforts to develop the country’s proposed second compact, played a key role in GE’s confidence to invest in this particular sector.
- Working with MCA-Namibia and the Government of Namibia, Microsoft is using radio spectrum technology powered by solar energy to connect 23 remote Namibian schools to the Internet for the first time as part of the compact-funded education project. Microsoft agreed to provide technical support and funding after Namibia’s MCC compact ends.
- In March 2013, MCC announced a partnership with The Coca-Cola Africa Foundation to expand access to clean water and sanitation in Africa, starting in water-scarce Cabo Verde. Part of MCC’s million compact with Cabo Verde is implementing crucial water sector reforms, investing in key infrastructure to expand access to clean water and sanitation and establishing a financially sound, transparent and accountable institutional basis for the delivery of water and sanitation services to Cabo Verdean households and businesses. The Coca-Cola Africa Foundation has pledged, through the Replenish Africa Initiative, to significantly invest alongside MCC’s effort in order to help up to 20,000 low-income and female-headed households gain access to the water network, providing proper sanitation as well as hygiene education for thousands of people. MCA-Cabo Verde is coordinating with Cavibel, the local Coca-Cola bottler, to maximize the impact of the partnership. More reliable and higher-quality water for Cavibel provides the potential for a better bottom line for Coca-Cola while also benefiting Cabo Verdeans.
Excerpts from Conversations with Industry
MCC helped Pike Electric first expand its business into Africa when the North Carolina-based company competitively won a contract as part of the Energy Sector Project in Tanzania’s compact, which closed in September 2013. Pike is planning to continue investing in the fast-growing East African power sector. Here’s some of what chairman and CEO J. Eric Pike had to say about the company’s future.
- Can you explain a bit about the work Pike performed in Tanzania?
- Pike built out approximately 800 kilometers of distribution lines: 400 kilometers of medium-voltage and 400 kilometers of low-voltage lines. Pike erected an estimated 4,000 medium-voltage poles and about 8,000 low-voltage poles. There were 84 distribution transformers (substations) on the project. This project ran through 84 villages, each served by the 84 distribution transformers that Pike installed.
- Was your work on the Tanzania Compact your first investment in sub-Saharan Africa? If so, why did you decide to make the investment?
- With the recession in 2010, projects in the electrical sector in the United States were limited, so we sought out opportunities elsewhere.
- Will Pike consider future investment in Africa?
- Absolutely. We are currently looking at several upcoming MCC projects.
- Did Pike’s investment in Tanzania help create jobs back in the United States?
- Initially, with the recession in 2010 and the depressed economy, it saved several jobs. Also, with our first taste of international project success, it will add jobs as we pursue other opportunities abroad.
Combustion Associates, Inc. (CAI) is a California-based manufacturing company that builds and installs power generation systems worldwide. In 2007, CAI won a contract to install an 80-megawatt power plant in Benin, a country that completed a 7 million MCC compact. CAI shipped its equipment through the Port of Cotonou, which the compact modernized and expanded. CAI owner Kusum Kavia talks about her experiences in Benin.
- Why did you choose to compete for a contract in Benin?
- Our focus has always been on Africa, particularly West Africa. West Africa has natural gas and oil, and the reason the Government of Benin was putting out the contract was because the West Africa natural gas pipeline was coming into their country. Benin looked at this free supply of natural gas and decided to use it to supply power for the citizens and enable the infrastructure to develop. It attracted us because our power plants run on natural gas and liquid fuel, so when the government put out the [request for quotation], we bid on it because of that. The Government of Benin liked our proposal because we would use local labor and create jobs, provide training on how to operate the power plant and help the country’s economic development.
- Did the improvements to the Port of Cotonou encourage you to invest more in the region?
- Absolutely. The U.S. ambassador invited our staff to the embassy and asked us to speak to other American companies about our successes. The port will come in handy for doing business with the region’s landlocked countries. We’re looking at installing a 120-megawatt power plant in Mauritania. It would be the Port of Cotonou that we’d bring everything through. We will see more growth because that infrastructure is already in place.
- Have MCC’s investments in Benin allowed CAI to expand its business and hire new employees?
- Yes. We’re hiring staff. We just added two senior project engineers, and we’re looking to extend our sales and marketing department. We’re also looking for agent distributor agreements so we have in-country representation. We’re getting ready for those key markets. We see a ramp-up in business and jobs added because of MCC’s work there.
Practicing our Values
By embracing collaboration and practicing excellence, MCC recognizes the power of partnerships to maximize benefits and sustain impact for global development.
Partnering throughout the U.S. Government
In an increasingly constrained fiscal environment, it is more important than ever that U.S. Government agencies, including MCC, work together to avoid duplication and achieve results that would otherwise not be possible working alone. Success includes:
- USAID: In Jordan, MCC and USAID are collaborating on a feasibility study of bio-solid and sludge at the As-Samra Wastewater Treatment Plant. The study will examine ongoing stockpiling of dried sludge and bio-solids at the plant, and develop short- and long-term solutions for proper use and disposal, including reuse in agriculture and land application. The results will assist the Government of Jordan in establishing a reuse strategy and develop related standards and guidelines. In Moldova, USAID and MCC are collaborating on the implementation of the Growing High-Value Sales Activity, part of the MCC-funded Transition to High-Value Agriculture Project. This activity aims to expand market opportunities for Moldovan high-value agriculture, upgrade production and ability to meet buyer requirements, provide demand-driven technical assistance to actors across the high-value agriculture chain, and strengthen the sanitary and phytosanitary capacity of the Government of Moldova.
- U.S. Water Partnership: In November 2012, MCC joined the U.S. Water Partnership to tackle global water challenges. As a lead partner, MCC provided executive resources and played a key role in the partnership’s startup. Since then, 18 other U.S. Government agencies and 42 private or civil society entities have joined to promote sustainable water management for people and the environment. This involves improving access to and quality of water service, sanitation and hygiene; advancing integrated water resource management; increasing efficiency and productivity of water use; and strengthening governance with effective institutions, policies and processes.
- Partnership for Growth: The Partnership for Growth creates a mature economic dialogue between the United States and a select group of high-performing developing countries, namely El Salvador, Ghana, the Philippines, and Tanzania. The goal is to tackle the most acute constraints to private investment and economic growth through policy and institutional reform, private sector engagement and other efforts that draw on the full range of capabilities available within the U.S. Government. In Ghana and Tanzania, MCC worked with USAID, the State Department, the Treasury Department, the Overseas Private Investment Corporation, the Export-Import Bank of the United States, and the U.S. Trade and Development Agency to support cost-reflective tariffs, loss reduction, private sector partnerships, and other key power sector reforms. In El Salvador, MCC worked with USAID, the State Department, the Commerce Department, and other agencies to promote a public-private partnership bill that was enacted into law despite significant obstacles. In the Philippines, the MCC compact supports a whole-of-government effort to modernize tax administration to boost funds for such key needs as health, education and infrastructure. Early results have been positive, including an increase in tax collection and improved efficiency in revenue operations in the Philippines. MCC efforts in all four countries benefited from information-sharing, coordination and planning with other U.S. Government agencies.
- Feed the Future: In 2013, MCC continued to actively support Feed the Future, the Obama Administration’s global food security initiative that is led by USAID. Our agriculture investments in Burkina Faso, Moldova, Mongolia, Morocco, Mozambique, Namibia, the Philippines, Senegal, and Tanzania are addressing some of the determining factors of food insecurity in these countries, while generating outcomes that align with Feed the Future’s high-level agriculture sector growth and nutrition objectives. In addition, we champion efforts to rigorously test our investment effectiveness and push ourselves to do our business of investment in agriculture and food security better. For example, MCC along with USAID, the United Kingdom Department for International Development, the International Fund for Agricultural Development, the Food and Agriculture Organization of the United Nations, the United Nations World Food Programme, the World Bank, the Organisation for Economic Co-operation and Development, the Bill & Melinda Gates Foundation, and other development partners working in the area of food security joined together in an effort to harmonize and align monitoring and evaluation activities and agendas to more rigorously support evidence-based learning. As part of that harmonization and alignment effort, the group developed a collaborative Food Security Learning Framework to be used to guide scarce evaluation dollars to answer critical questions and generate a body of knowledge to improve the design and management of interventions in agriculture, economic growth and nutrition.
Partnering with other Donors
Working with other donors, including partner countries, has helped build up, amplify and further sustain MCC’s development efforts worldwide. For example:
- In developing the Honduras Threshold Program, MCC worked with two partners—the World Bank’s Public-Private Infrastructure Advisory Facility and the International Finance Corporation—to review the infrastructure priorities that the government hopes to deliver through public-private partnerships. MCC asked both development partners to conduct project scoping exercises and identify next steps in designing a program for possible MCC support. This work is underway.
- In May 2013, MCC signed a memorandum of understanding with the World Bank and Ghana’s Millennium Development Authority (MiDA) to provide professional-level curriculum and modules to the World Bank for use in education programs to help strengthen public procurement around the world. Strengthening accountability and administrative functions as they relate to government spending is critical for reducing poverty through economic growth. The MCC, MiDA and World Bank collaboration formalized learning in public procurement, promoted procurement professionalization and expanded on already successful programs initially implemented through the World Bank in Liberia and through Ghana’s MCC compact. That compact’s Procurement Capacity Activity built capacity and educated civil servants and students on international procurement standards. The curriculum and modules developed under the program were a new national approach to formal procurement education for Ghana’s civil service. Five institutions of higher learning took part in the activity, which trained almost 300 procurement personnel and students and placed 1,250 students in procurement internships at government offices.
- MCC and other U.S. Government partners are collaborating with the Government of Burkina Faso to help the poor, rural population who depend on access to land for food and income-generating activities. This partnership, part of the G-8 Transparency Initiative, was announced in June 2013, and builds upon MCC’s $59 million Rural Land Governance Project, our largest and perhaps most ambitious land and property rights project to date in a compact. The partners will work together to meet two key objectives over the next six years: establishing and operating a national “land observatory”—an institution for monitoring progress on land governance and promoting information sharing—and building capacity for tracking land transactions and increasing their transparency.
- In the Philippines, the MCA is supporting significant tax reform, with an aim to increase tax revenues and reduce corruption. As part of the compact with the Philippines, MCA is financing technical assistance from the International Monetary Fund, which has placed a full-time advisor at the Bureau of Internal Revenue. This is the first time a U.S. Government agency has worked directly with the International Monetary Fund’s Institute for Capacity Development.
- In Indonesia, the MCA is contributing to a multi-donor trust fund managed by the World Bank. MCA’s contribution will introduce a nutrition component to an ongoing community-driven development program. The project aims to reduce childhood stunting by creating both an increased supply and demand for nutrition services.