millenium challenge corporation us report 2009

8/9/2019 Millenium Challenge Corporation US Report 2009

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1

InvestIng In Resultsannual report 2009


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2 2009 AnnuAl RepoRt

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The Millennium ChallengeCorporation is an essential

partner as we work to

combat global poverty...pResident BARAck H. oBAmA nOveMbeR 6, 2009


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3investing in Results

Te Millennium Challenge Corporation is an innovative U.S. Government ap-

proach to achieving President Obamas vision or ghting global poverty. MCC

makes prudent choices about where to deliver development assistance by partner-

ing with poor countries already committed to good governance, economic reedom,

and the empowerment o their citizens. MCC expects partner countries to lead

their development through homegrown ideas and local implementation, creating

their own sustainable solutions. MCC-unded projects advance quantiable results

that improve the lives o the poor in practical and meaningul ways. Our transpar-

ent, country-driven, results-based approach to ghting global poverty is expected

to raise incomes by over $ billion over the lie o our current investments, benet-

ting more than million people. Tis generates opportunities or the poor and

contributes to worldwide prosperity, which is critical to Americas own economic

recovery. For MCC, ghting global poverty means investing in results or both the

worlds poor andAmerican taxpayers.

. . . . . . . .Message From Secretary o State Hillary Rodham Clinton, Chair o the Board o Directors

. . . . . . . .Message From Daniel W. Yohannes, Chie Executive Ocer

. . . . . . . .Forward-Tinking

. . . . . . . .Partnerships Tat Deliver

. . . . . . . .angible Results

. . . . . . . .Financial Statements

orw & tab c


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Te Millennium Challenge Corporation (MCC)s approach

to development assistance is one o the U.S. Governments

most innovative and orward-thinking vehicles or leverag-

ing resources in this ght against global poverty. MCCs

progress is measured in more than indicators such as the

number o schools opened, children vaccinated, roads

built, armers trained, and land titles issued. It is also mea-

sured byhow MCC is investing in results. Additionally, we

have made anticorruption a priority not only or qualiying

or MCCs assistance (the hard hurdle), and subsequent

program implementation, but also a platorm or encour-

aging partners towards more responsible governance and

enhanced accountability. MCC proves that a model or de-

velopment can, in act, work eectively when partnerships

are predicated on sound policy reorms, where countries

are responsible or their own development, and where

tangible results are measured by indicators o success.

MCC oers valuable lessons learned to inorm the uture o

oreign assistance.

MCCs results-driven development model will continue

creating opportunities or global growth and prosperity

with the ongoing support o Congress and the development

community, non-governmental organizations, the private

sector, and key stakeholders, including the American peo-

ple. Advancing MCCs work is one way all o us can make a

sustainable dierence in the lives o the worlds poor.

Te Obama Administration is also working toward increas-

ing U.S. assistance or long-term agricultural productivity

in order to strengthen global ood security and reduce

hunger and poverty. In addition, we are calling or a new,

integrated approach to assistance or global health in order

to bolster health systems and to provide investments or

child and maternal health, amily planning, and ways to

save lives rom HIV/AIDS, neglected tropical diseases,

malaria, and tuberculosis.

Initiatives like these conrm a new chapter in American

global engagement. It is smart power at its best, building

partnerships not just through our deense and diplomacy

capabilities but also through our development abilities to

help the poor strengthen their capacity to sustain a higher

standard o living or themselves and their amilies.

ma Fr srary sa Hary Rha c,mcc char h Bar drr

Hillary Rodham Clinton, Chair


7/1025investing in Results

Results matter, and in the ght against global poverty,

results are lie-changing and lie-saving. Tat is why the

Millennium Challenge Corporation is committed to invest-

ing in programs that achieve sustainable results to improve

the lives o the poor worldwide. o do this, we are thinking

dierently about the undamental principles that make the

delivery o development assistance eective. We are org-

ing strong partnerships with others who share our goals to

maximize eorts across key sectors. We are breaking new

ground by measuring and reporting results in ways that are

transparent and open to public scrutiny and eedback. We

are proud to be part o the ongoing discussion about the

uture o development assistance.

Te2009 Annual Reportchronicles what has already been

achieved, as partner countries worldwide continue imple-

menting over $ billion in Millennium Challenge grants

to ght poverty and stimulate economic growth. With

gender-inclusive investments in agricultural productiv-

ity, education, health, inrastructure, and land security, or

example, MCC is a smart and eective investor o U.S. re-

sources in the ght against global poverty. We are deliver-

ing the tangible opportunities that give poor communities

a reason to hope. We are showing American taxpayers that

their development dollars are being wisely spent or the

benet o the worlds poor and to orge a more prosperous

and secure world that benets us all.

We still have much more to do. In my time as MCCs Chie

Executive Ocer, I am committed to advancing MCCs

noble mission through innovation, through broader en-

gagement o the private sector, through stronger partner-

ships both within and outside the U.S. Government, and

through a continued ocus on results. Te valuable lessons

learned by working with partner countries, interacting

with supporters and critics in the development community,

and implementing our programs continue to show us ways

to more eectively invest in results. And through these

results, MCC is delivering opportunities and sustainable

solutions in the ght against global poverty.

ma Fr da W. Yha,ch ex or

Daniel W. Yohannes, Chie Executive Ocer


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Through an innovative approach to development assistance, MCC invests in results by investing in critical sectors

that improve the lives o the poor. These sectors reect the Obama Administrations international development goals,

and MCC is a key tool in helping the U.S. Government move orward in ullling these priorities through partnerships

worldwide.

FoRWARd tHinkingPartnershiPs that Deliver

tangible results


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7FoRWARd tHinking

Food security is not merely a question o

getting ood to hungry people. It represents

the convergence o complex issues thathave a direct bearing on economic growth,

energy and environmental actors, and our

strategic interests. And as such, it demands

a comprehensive response. I we can build

partnerships with countries to help small

armers improve their agricultural output and

make it easier to buy and sell their products

at local or regional markets, we can set of a

domino efect. We can increase the worlds

ood supply or both the short and the long

term; diminish hunger; raise armers in-

comes; improve health; expand opportunity;

and strengthen regional economies.

secRetARY oF stAte

HillARY RodHAm clinton

septeMbeR 25, 2009

pr F sry

Barbara Ayisa o Aumkrom, Ghana spends her day grow-

ing onions and maize. Tis year, she was among the

armers in the Aumkrom Vegetable Growers Associationto receive training as part o an integrated solution to long-

term agricultural productivity under MCCs $ million

compact with Ghana. Te program also includes MCC-

unded projects that enhance land tenure security, promote

irrigation development, improve post-harvest handling o

produce, expand credit, and rehabilitate secondary/eeder

roads. In addition, Barbara and other armers received

seeds, ertilizers, sel-sealing grain storage bags, and arm-

ing tools. Equipped with these new resources, as well as

MCC-unded training, Barbara increased her elds yield.With the sel-sealing plastic bags she received, she is able to

saely store her maize to eed her amily or until she can sell

it at the best market price, earning the most she can.

An ocean away in Honduras, a better way to arm led Edras

Mateo to a better lie or himsel and his amily. Look-

ing or an alternative to poverty and gangs, Edras sought

out agricultural training through MCCs compact with

Honduras. Trough this training, Edras learned how to

implement techniques to increase his lettuce yield to meetmarket demand and expand into other high-value crops. A

year later, with his increased income, Edras was able to buy

a home or his amily, keep his two children in school, and

purchase . hectares o land to arm. Now, nearly a dozen

nearby armers seek him out or technical assistance to

emulate his success. Complementary projects in the Hon-

duras compact that invest in irrigation, or example, create

added benets or Edras and armers like him to increaseproductivity.

Barbara Ayisa and Edras Mateoand thousands o other

armers benetting rom MCC assistanceare proo that

alleviating global poverty requires investing in global ood

security. Te U.S. Government is committed to this, and

MCC is an eective and essential tool in achieving Amer-

icas commitment to global ood security by supporting

long-term agricultural development and rural economic

growth.

Nearly $3.7 billion o MCCs total worldwide commit-

ment o over $7 billion supports sustainable, market-

based advancements in ood security. Trough a diverse

portolio o investments, MCC supports all aspects o the

ood production and distribution system. Tis includes

transerring agricultural technology, securing land rights

and access to rural nance, increasing access to sucient

and clean water, and building rural roads and other arm-

to-market inrastructure, like dry- and cold-storage acili-ties. Tese investments help armers and rural businesses

obtain productive inputs such as seeds, water, and ertil-

izers, overcome bottlenecks that hinder their ability to get

produce rom arm to market, and engage in higher-value

production to generate rural income growth.


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Investing in human development is a prerequisite to sus-

tainable poverty reduction and economic growth. Tats

why MCC promotes human development through in-vestments in health, education, water, and sanitation. In

total, MCC is investing nearly $1 billion in education,

health, water, and sanitation worldwide. Tis investment

strengthens human development and expands the capaci-

ties o citizens in partner countries to lead healthy lives, to

increase their knowledge, and to attain a decent standard

o living.

In Lesotho, where an estimated percent o the adult

population is HIV-positive, MCC is investing $ mil-lion in compact unds to strengthen healthcare systems.

In coordination with thePresidents Emergency Plan or

AIDS Relie(PEPFAR), MCC is helping the children o

HIV-positive mothers live long and healthy lives. MCCs

renovations o health centers complement PEPFARs

particular ocus on the prevention o mother-to-child HIV

transmission. As more women deliver babies at these

MCC-renovated health acilities with maternity wards,

PEPFAR can better track mothers and babies adherence to

HIV prophylaxis.

In Mongolia, MCC is investing compact unds to improve

and expand the national non-communicable diseases and

injury prevention program. By implementing programs

aimed at changing poor dietary habits, lack o exercise,

smoking rates, and alcohol abuse, MCCs partnership with

Mongolias Ministry o Health aggressively tackles non-

communicable diseases, which are a major cause o deathamong working-aged Mongolians.

In Ghana, schools have been renovated or are under

renovation, with hundreds more to be built, as part o

Ghanas $ million MCC compact. Trough a part-

nership with the United States Agency or International

Development(USAID), these MCC-unded schools will be

staed with trained teachers. In addition to Ghana, MCC

is unding educational and training programs in Burkina

Faso, El Salvador, Mongolia, Morocco, and Namibia.

In Mozambique, $. million o the countrys $. mil-

lion MCC compact is improving access to water and sanita-

tion in eight cities and rural villages. Increasing access

to sae, reliable water supplies and sanitation services

boosts productivity and reduces water-borne diseases, the

leading cause o death in children under ve. MCC invest-

ments are also expanding the capacity o water treatment

plants in anzania and rehabilitating water sanitation and

irrigation systems in Georgia. Jordans proposed compact,under development during this scal year, is expected to

include major projects to increase access to drinking water,

improve waste water collection, and reduce water losses in

the countrys second largest city.

srh Ha d


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9FoRWARd tHinking

B irarr

Te prosperity o households and the growth o com-

munities throughout the developing world depend

on sound inrastructure. Adequate inrastructureacilitates private sector investments, expands trade

opportunities, opens markets to armers, and provides

access to schools and health clinics. Without such

inrastructure, the cost o doing business increases,

transportation costs and times skyrocket, economic

growth is stunted, and the standard o living or the

worlds poor remains bleak. It is no surprise, then, that

MCC partner countries have overwhelmingly targeted

their MCC investments to address their inrastructure

needs, not only building critical roads and bridges butalso renovating ports, electricity grids, and irriga-

tion systems. More than 33 percent o MCCs total

worldwide commitments support transportation

inrastructure alone.

Cape Verde completed the construction o the road

rom Orgos to Pedra Badejo on Santiago Island

through its $ million MCC compact. Tis marked

MCCs rst completed road project in Arica. Te

new road, inaugurated in June , complies with allenvironmental requirements, decreases transportation

costs, and improves access to markets, schools, and

community services or amilies, armers, businesses,

non-governmental organizations, and social service

providers who live and work along its path.

In Ghana, groundbreaking orNational Highway 1

(N1) took place in October . TeN1 is a linchpin

project in Ghanas $ million MCC compact, which

is transorming the countrys agriculture sector and

making exports more competitive. Now, pineapples sit

on the back o a lorry or three hours between Malam

and etteh Quarshie on their way to the port o ema,

wasting time and uel, and shortening the ruits shel-

lie. By acilitating movement around Accra and to

ema, theN1 will reduce these transport costs and will

complement the agriculture and rural development

projects also unded by the compact.

Similarly, El Salvador witnessed the historic ground-

breaking or the Northern ransnational Highway in

April , the major component o its $ million

MCC compact. Te highway ullls a generational

dream to unite the Northern Zone with the rest o

the country through a modern road system, slashing

travel time rom Metapan to Chalatenango rom our

hours to minutes. On this and all road projects,MCC requires comprehensive resettlement plans. In

El Salvador, or example, theNorthern ransnational

Highway will pass through the land o the Lpez am-

ily. Trough MCC-unded resettlement eorts, the

amily was compensated or their land and received a

pair o cows and training in milk production to boost

their earnings.

Also in El Salvador, the rst kilometers o rural

electrication lines have been constructed and the rst solar panel systems have been installed, making

a dierence in the lives o more than , isolated

households. Tis investment protects the environ-

ment, while harnessing a renewable energy source in

the ght against poverty.

In Armenia, new and reurbished water canals con-

tinue to provide armers with a reliable supply o water

to irrigate their arms, expand production, invest in

protable crops, and increase their incomes. o ur-ther this, the rehabilitation o a . kilometer section

o the main Arzni-Shamiram water canal started in

December , with portions completed during the

harsh winter or use during the Spring irrigation

season.


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MCA-Benin, which is responsible or managing the

implementation o Benins MCC compact, partnered

with villages to support activities that increaseland tenure security and improve land management.

Public ceremonies were held throughout the country

to engage local authorities and inorm beneciaries

o upcoming opportunities. Tese outreach eorts

complemented technical innovations, including

installation o seven Continuously Operating Reer-

ence Stations (CORS) as the core o a modern national

geodetic reerence ramework, which allows survey-

orspictured here with GPS equipmentto survey

and map land parcels accurately and eciently. With

this MCC-unded technology and technical assistance,

Benin hopes to convert , occupancy permits

in urban areas to land titles and to issue land titles orcerticates to , rural households.

Like Benin, many other MCC partner countries

recognize that secure and ecient access to land and

property rights contributes to poverty reduction and

economic growth. Countries are supporting legal and

regulatory reorms to bolster transparency and the

rule o law, clariying and ormalizing land and prop-

erty rights, developing more client service-oriented

property registries, building the capacity o local in-

stitutions, and engaging in land-related outreach and

education. Tese approaches reduce transaction costs,

increase tenure security, and improve land allocation,resulting in more investments in land and property

and higher land productivity and value.

MCC has invested over $297 million in country-

determined and country-driven strategies to

strengthen the real property rights and land policy

systems in countries rom Arica to Eurasia to Latin

America. Because o this commitment, armers,

households, and businesses are more willing to protect

and invest in their land or property. Secure tenure iscritical or accessing credit, promoting investment and

private sector activities, and generating sel-sustaining

market opportunities or economic growth. Tis

commitment also promotes community development.

Secure rights to property use, ownership, and transer

empower communities to demand basic services rom

their governments, like electricity, water, and sanita-

tion. Investing in access to land and property rights

protects women and their children, who, together,

disproportionately shoulder the burden o poverty.Moreover, tenure security creates incentives or man-

aging land and natural resources responsibly, thereby

promoting environmental stewardship and addressing

the implications o climate change.

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phOtO COuRtesy O tRIMble, supplIeR O the gps equIpMent


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11FoRWARd tHinking

cha gr eqay

Te October launch oJordans Womens Knowledge

Networkis an example o the role gender integration plays

in development. Funded through Jordans MCC thresholdprogram with support rom the Jordanian National Com-

mission or Women and USAID, theNetworkgives women

a valued voice in society by promoting the gender integra-

tion o local councils. It ocuses on empowering emale

municipal council members nationwide. As o March

, theNetworkconducted several regional meetings

attended by over emale council members rom over

municipalities. TeNetworkalso hosted a popular work-

shop ocused on improving local government planning and

capacity.

MCC continues to work to strengthen gender integra-

tion in the development and implementation o programs

worldwide. In Benin, women are learning o the benets

associated with obtaining land titles and receiving mi-

croloans. Lesotho worked with MCC to ensure gender

equality in economic rights. And, the largest component o

Lesothos compact ocuses on delivering essential mater-

nal and child health services, particularly related to HIV/

AIDS prevention and treatment. In Mali, women will haveaccess to irrigated land plots through womens associations

so they can grow what they choose to eed their amilies

or sell at market. Nicaragua established a consultative

council o emale representatives to help shape the coun-

trys compact program. Women entrepreneurs in Georgia

are contributing to economic growth by expanding their

agribusinesses.

MCC recognizes that gender inequality is a signicant

constraint to economic growth and poverty reduction;

that is why we ensure that gender issues and the concerns

o vulnerable populations are considered in all stages o

our work with partner countries. Troughout the selec-

tion o eligible countries, the development and design

o compact programs, the implementation o projects,

the monitoring o program results, and the evaluation

o program impacts, gender plays an important role.

MCCs Gender Policy consolidates our commitment togender integration as undamental to sustainable poverty

reduction and economic growth. An initial internal review

o the implementation o this Gender Policy revealed prog-

ress in designing gender-inclusive programs that account

or gender dierences and inequalities, in creating opportu-

nities or learning and capacity-building across sectors, in

generating greater awareness o the value o gender integra-

tion to program quality and deliverables, and in broadening

local interest in dedicating resources and sta to social and

gender assessment.


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Understanding the MCC Modelmcc r by a fr way r aa.

a oic rormc- mo

rwr oo orc

MCC works with those countries that show they are committed to good policies .

MCC assistance is more likely to be successul when it is invested in countries com-

mitted to sound policy perormance. o qualiy or a large-scale grantwhat we call

a compactpotential partners must score better than their peers, either low-income

or lower-middle-income countries, on independent indicators that measure,

among other actors, government eectiveness, control o corruption, civil liberties ,

immunization rates, girls primary school graduation rates, days and cost to start a

business, and trade policy.

Te MCC selection process also provides an incentive or other countries to improve

their policies so they too might qualiy or a grant. Liberias President Ellen John-

son Sirlea stated in October , MCC has had a transormative eect across the

developing world. Responsible, reorm-minded governments have set their sights on

the MCC benchmarks, and this has accelerated the pace o reorm while empowering

governments to make decisions on their own path o development and the direction o

their uture.

MCC has ocused a particularly intense spotlight on corruption. MCCs Board o

Directors generally requires that countries passscore above the median onatleast hal o the indicators in each o the three categories:governing justly, investing

in people, and encouraging economic reedom. Te Board also generally requires that

countries pass the control o corruption indicator. As a result, many countries, in-

cluding those in MCCs threshold program, ocus their program on eorts to reduce

corruption.

GNI/Cap: $2,470

Populat ion 4 ,364,461

LMICGeorgia FY10

Investing In People

Ruling Justly

Economic Freedom

Howto Read this Scorecard: EachMCC CandidateCountry receives anannual scorecardassessing its performance in3 policy categories: RulingJustly, InvestinginPeople,and Economic Freedom. Under the nameofeach indicator is thecountrys score andpercentile rankingin its incomepeer group(0%is worst; 50%is the median; 100%isbest). Undereach countrys percentilerankingis the peer groupmedian. Country performanceis evaluated relative tothe peer groupmedian. Scores above themedian,represented withgreen, meetthe performancestandard. Scores ator belowthe median,represented withred, donot meetthe performancestandard. The black linethatruns alongthehorizontal axis represents thepeer groupmedian. EachWorld Bank Instituteindicator is accompaniedby amarginof error, whichis representedby thevertical bluebar.

FreedomHouse

WorldHealth Org.

WorldBank Institute

F re ed om H ou se W or ld B an k I ns ti tu te W or ld B an k I ns ti tu te W or ld B an k I ns ti tu te W or ld B a nk I ns ti tu te

World Health Org. UNESCO/National Sources UNESCO CIESIN/YCELP

IFAD/IFC IFC Heritage Foundation IMF WEO IMF/National Sources

Formore informationregarding theMillenniumChallengeAccount SelectionProcess andtheseindicators, pleaseconsult MCCs website: www.mcc.gov

Sources:

Sources:

Sources:

0

10

20

30

40

' 04 ' 06 ' 08

Median 20

Political Rights

Data 18 (44%)

0

20

40

60

' 04 '0 6 ' 08

Median 33

Civil Liberties

33 (47%)

Median 0.00

Control ofCorruption

0.31 (74%)

-2 .0

-1.0

0.0

1.0

2.0

'04 '06 '08

Median 0.00

GovernmentEffectiveness

0.60 (91%)

-2 .0

-1.0

0.0

1.0

2.0

'04 '06 '08

Median 0.00

Rule of Law

0.02 (53%)

-2 .0

-1.0

0.0

1.0

2.0

'04 '06 '08

Median 0.00

Voice andAccountability

0.00 (53%)

-2 .0

-1.0

0.0

1.0

2.0

'04 '06 '08

Median 0.00

Regulatory Quality

1.02 (100%)

-2 .0

-1.0

0.0

1.0

2.0

'04 '06 '08

Data

-10

-5

0

5

10

' 04 '0 6 ' 08

Median -0.4

Fiscal Policy

-4.7 (9%)

20

40

60

80

100

' 0 4 ' 06 '0 8

Median 93.5

Immunization Rates

94 (53%)Data

0.0

0.2

0.4

0.6

0.8

1.0

' 05 ' 07 ' 09

Median 0.722

Land Rights andAccess

1.000 (100%)

0.0

0.2

0.4

0.6

0.8

1.0

' 05 ' 07 ' 09

Median 0.960

Business Start-Up

0.995 (100%)

20

40

60

80

100

' 05 ' 07 ' 09

Median 72.6

Trade Policy

89.1 (100%)

0

10

20

30

'0 4 ' 06 ' 08

Max. 15

Inflation

10.0 (42%)

10

40

70

100

130

'0 4 '0 6 '0 8

Median 97.6

Girls' PrimaryEducation Completion

96.7 (48%)

0

3

6

9

12

15

'0 4 ' 0 6 '0 8

Median 2.81

Health Expenditures

1.50 (12%)

0

25

50

75

100

' 0 5 ' 07 '0 9

Median 79.64

Natural ResourceManagement

81.46 (58%)

0

2

4

6

8

10

'0 4 '0 6 '0 8

Median 1.97

Primary EducationExpenditures

1.05 (12%)

10/21/2009

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15/102

13FoRWARd tHinking

Country ownership is not just a catchphrase at MCC. It is a ounding principle,

stemming rom the rmly held belie that signicant and sustainable development

cannot be imposed rom outside but must be built rom within. U.S. assistancethrough MCC can be a powerul catalyst or development, but only i partner coun-

tries seize the opportunities it creates. For that reason, once a country is selected,

it is in control. Te country, not MCC, identies its barriers to poverty reduction

and economic growth and develops its own compact proposal. Countries are asked

to consult broadlywith civil society, the private sector, their legislature, political

parties, international donors, and potential beneciarieseither as a supplement to

existing consultations or, in some cases, as their rst public consultation.

Once the compact is approved, the country is responsible or implementing it. Te

country designates an entity to oversee compact implementation, which oten takes

the orm o a board and program management oce composed o partner countrynationals. Tese country-specic entities are reerred to as MCAs. Because o this

leadership, MCC is able to maintain a small in-country presence, usually only two

U.S. direct-hired sta members, with two or three local hires. MCC encourages

consultation throughout implementation by insisting on transparency and public

outreach. Because countries dier in capacity, MCC has adopted a sliding scale o

technical assistance and oversight, never losing sight o the value o learning by

doing among local stakeholders.

a cor-ri mo m cor- om


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Country MCA Name Website

Armenia MCA-Armenia http: //www. mca.am/new/envers ion/index.php

Benin MCA-Benin http://www.mcabenin.bj/

Burkina Faso MCA-Burkina Faso

Cape Verde MCA-Cape Verde http: //www. mca.cv/

El Salvador FOMILENIO http: //www. mca.gob.sv/ omilenio/index .php

GeorgiaMillenniumGeorgia Fund

http://www.mcg.ge/

Ghana MiDA http://www.mida.gov.gh/

Honduras MC A-Honduras http://www.mcahonduras .hn/

Lesotho MCA-Lesotho

Madagascar MCA-Madagascar http://www.mcamadagascar.org/

Country MCA Name Website

Mali MCA-Mali http://www.mcamali.org/

Mongolia MCA-Mongolia

MoroccoAgence duPartenariat pour leProgrs

Mozambique MCA-Mozambique

Namibia MCA-Namibia

Nicaragua MCA-Nicaragua http: //www. cuentadelmilenio. org .ni/

Senegal MCA-Senegal

anzania MCA-anzania http://www.mca-t.go.tz/

Vanuatu MCA-Vanuatuhttp://www.governmentovanuatu.gov.vu/mca-

vanuatu/Home/tabid//Deault.aspx


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15FoRWARd tHinking

Getting started:

Country names NationalProgram Coordinator keymanager of the compactprocess

Country establishes CoreTeam responsible forcompleting the compact

Country commences initial

public consultations

Country completes analysisof binding constraint togrowth

MCC provides feedback onanalysis of binding con-straints to growth

MCC provides guidance on

results focused projectdesign principles and tools

Identifying priorities:

Country consults stake-holders on potential pro-

jects

Country develops and pro-

vides a Project ConceptPaper for each potentialproject each paper pro-poses a set of related in-vestments

MCC conducts a peerreview of the proposedProject Concept Papers;MCC may undertake fact-finding mission to country

MCC provides formal re-sponse to Project ConceptPapers identifying suitablecandidates and indicates

further studies that may beneeded

MCC provides 609(g) fund-ing if needed for projectdevelopment of approvedconcepts

Developing the program:

Country further developsprojects that appear promis-ing for potential investment

MCC disburses 609(g)

funding and assists withneeded preparatory studies

feasibility studies, environ-mental impact assess-ments, framework resettle-ment plans, preliminarydesigns, etc.

Country consults stake-holders on project designand sustainability

At an appropriate time,

MCC prepares and submitsCongressional Notificationto commence negotiations*

MCC conducts formal ap-praisal of developed pro-

jects, including secondpeer review

Negotiating* the terms of theCompact:

MCC and country conductcompact negotiations(technical content)

MCC prepares and submits

Investment Memo to MCCInvestment Committee

MCC and country negotiatecompact documents (legaldocumentation)

MCC Board approves Com-pact

MCC and country sign theCompact -- at this pointfunds are obligated, pro-gram objectives are definedand total dollar amount isset

Getting ready forimplementation:

Compact ratification, if nec-essary

Completion of stand-up ofMillennium Challenge Ac-

count (MCA) AccountableEntity

Completion of ImplementingEntity agreements

Completion of annual budg-ets and implementationplans

Completion of Terms ofReference and work plansfor implementation andprocurement

Pre-qualification of consult-

ants and contractors forearly procurements

The clock starts:

Compact Enters IntoForce (EIF) and five yearclock starts

Compact provisions in full

force and effect in the coun-try

Accountable Entity is re-sponsible for overseeingimplementation of projects

PMU submits quarterlyprogress reports

MCC authorizes disburse-ments, U.S. Treasury trans-mits funds

Ongoing public updates onCompact

Monitoring and evaluationof project impacts

MCA Consultation may

include: transparency; out-reach; stakeholder commit-tees; resettlement process,etc.

Country sets up its Project Management Unit (PMU) structures Accountable Entity, Fis-

cal Agent, Procurement Agent, and Implementing Entities established and trained* As defined under Section 610 of theMillennium Challenge Act of 2003

1. Start up andPreliminary Analyses

2. ProjectDefinition

3. ProjectDevelopment

and Appraisal

4. CompactNegotiation and

Compact Signing

5. Pre-Entry intoForce Activities

Implementation Preparations 6. Implementation

pha ca d


18/102


$1.4 bIn CuMulatIve pROgRaM-

Related* dIsbuRseMents

$2.2 bIn CuMulatIve COMpaCt-

COntRaCt COMMItMents

Results count. Each proposed MCC compact activity is assessed or its potential

economic rate o return: o what extent will the additional income generated by

MCC investments or local amilies and rms exceed the cost o MCC investments?Compact programs are also assessed or their projected impact on beneciaries:

o what extent will a signicant share o the additional income go to low-income

households? Tis ocus on results denes MCCs aid eectiveness according to

impact rather than process.

Other elements o MCCs approach are also in line with international principles

o aid eectiveness. Te emphasis on country ownershipincluding the broad

participation o civil society and the private sector, the predictability o unding

enabled by setting aside unds or the entire compact at the outset, air and open

international procurements run by partner countries, and coordination with otherdonorsare evident in every step o the MCC process. Tese actors help ensure

that MCC investments are targeted to the right objectives and to maximizing value

or our investments. With a headquarters sta limited to people and an in-

country ootprint o only two U.S. direct-hires and two or three local hires in each

compact country, MCC extends this same concern about ensuring value or limited

resources to our own operations.

a r-ori mo o ccoii o wri

oimiz i ci orizio cic

Results tHRougH tHe endoF FiscAl YeAR 2009

*Ic comc, ro, 609(), iic


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17FoRWARd tHinking

MCCs Board o Directors

Te eectiveness o MCCs operations is enhanced by the experience o a unique public-private Board o Directors

comprised o the Secretary o State (Chair), the Secretary o reasury (Vice Chair), the U.S. rade Representative, the

U.S. Agency or International Development Administrator, MCCs CEO, and our individuals rom the private sector ap-pointed by the President with the advice and consent o the U.S. Senate. Contributing valuable insights and expertise, the

private sector component o our Board is one o MCCs most distinct eatures.

Hillary Rodham Clinton

Secretary o State

Chair

imothy F. Geithner

Secretary o reasury

Vice-Chair

Dr. Rajiv Shah

Administrator, U.S. Agency or

International Development

(as o December 24, 2009)

Ambassador Ron Kirk

United States rade Representative

Daniel W. Yohannes

MCC Chie Executive Over

(as o December 1, 2009)

Lorne Craner

President, International Republican

Institute

Senator William H. Frist, M.D.,

Schultz Class o Visiting Proessor o

International Economic Policy, Woodrow

Wilson School o Public and International

Aairs, Princeton University

Kenneth Hackett

President, Catholic Relie Services

(erm expired October 2009)

Alan J. Patrico

Founder and Managing Director,

Greycrot, LLC


20/102


Te simple reality is this: i we want others to help combat the threats that concern us most, then we must help others combat the chal-

lenges that threaten them most. For many nations, those threats are rst and oremost the things that aict human beings in their dailylives: corruption, repression, confict, hunger, poverty, disease, and a lack o education and opportunity. When the United States joins

others to conront these challenges, its not charity. Its not even barter. In todays world, more than ever, Americas interests and our

values converge. What is good or others is oten good or us.

u.s. peRManent RepResentatIve tO the unIted natIOns aMbassadOR susAn e. Rice, august 13, 2009

MCC is designed to maximize each dollar invested or poverty reduction and eco-

nomic growth.

Our increasingly globalized world brings immeasurable economic and cultural ben-

ets, but with these benets come an increasing reliance on citizens and govern-

ments beyond U.S. borders or long-term security and economic prosperity. oday,

more than one billion people live on less than $ a day. Nearly three billion live on

less than $ a day. Aside rom the humanitarian imperative to assist those less or-

tunate, the case or acting in our own interest to help people pull themselves out o

extreme poverty has never been stronger. We have all seen how terrorism, disease,

and environmental degradation can cross borders and impact American lives.

MCC is an important U.S. instrument or addressing these threats. By challenging

countries to adopt good governance, health, education, and economic policies that

empower their citizens, MCC osters stable, open societies that counter anaticism

and can evolve into positive role models in their regions. MCC investments lead

to sustainable reductions in poverty that can decrease the need or emergency hu-

manitarian assistance, increase access to education and health care, and strengthen

eorts to protect the environment.

President Obama said, In an era o integration and interdependence, it is also my

responsibility to lead America into recognizing that its interests, its ate, is tied up

with the larger world; that i we neglect or abandon those who are suering in pov-

erty, that not only are we depriving ourselves o potential opportunities or markets

and economic growth, but ultimately that despair may turn to violence that turns on

us.

Greater prosperity in the developing world will alleviate the poverty that breeds

discontent and instability. It will expand markets or American exports. It will

reduce the spread o disease. MCC is promoting Americas security and well-being

even as it generates a better lie or millions around the globe.

mcc va Ara taxayr


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19FoRWARd tHinking

MCC is making key contributions to the analysis o development policy. We are

contributing to the Quadrennial Diplomacy and Development Review being con-

ducted by the State Department. We are participating also on the interagency com-

mittee organized by the National Security Council to review the U.S. Governments

development policy under thePresidential Study Directive.

MCC was created to ulll one mandatepoverty reduction through economic

growth. We do this by partnering with countries worldwide, using certain fex-

ibilities we have, namely, no earmarks and no-year unding. MCC practices some

o the most innovative lessons learned or aid eectiveness: incentivizing good poli-

cies, requiring country-led development to build homegrown capacity, engaging

civil society, demanding accountability, applying rigorous measures to evaluate out-

puts and outcomes, and practicing transparency in all that we do. While MCCs

approach is not easy, it is proving eective in delivering development assistance to

reduce global poverty. We continue to share our experiences and best practices in

the implementation o our principled approach.

mcc a ibar ia, ia u.s. Fr Aa

My immediate reaction [to MCC] was this makes a tremendous amount o sense, sort o a criteria-based determination involving the

people o the country in terms o priorities on our valuable tax dollars going or oreign assistance in a ashion that would demonstratethe greatest capacity to produce results. And thats what I think MCC is doing and is trying to achieve, and so I am a strong supporter o

it a lot o the ideas o MCC, to me, are a prototype or what should sort o take hold in our whole oreign assistance program. So not

only is this important in terms o what its doing in the countries its now active in, but as a good indicator and a good instructor o direc-

tions we might go in with the whole oreign assistance program.

ChaIRMan O the hOuse OReIgn aaIRs COMMIttee HoWARd l. BeRmAn (d-CalIORnIa), June 24, 2009


22/102


To invest in results, MCC pursues an integrated approach to sustainable economic development.

Working with partner countries, other U.S. Government agencies, donors, and the private sector,

MCC demonstrates how we can achieve more through coordination and cooperation.

ForwarD thinking

pARtneRsHips tHAt deliveR

tangible results


23/102

21pARtneRsHips tHAt deliveR

MCC works closely with partner countries to increase the quality and sustainability o MCC-unded projects. From

reorming policies to setting aside maintenance unds or the upkeep o newly constructed roads, partner countries them-

selves are doing what it takes to ensure that MCC-unded projects are able to continue delivering benets well beyond thelie o our partnerships.

Women Farmers in Honduras BeneFit

From training, increased incomes

As a result of the better yields, product

quality, and markets, my conditions at

home have improved. We now have more

money to buy clothes and schools supplies

for our kids, and we can provide the health

care required for one of our daughters who

needs special health assistance,shares Ana

Cristina Vasquez Rodriquez o Honduras.

With technical assistance through the rural

development program o Hondurass MCC

compact, she diversied her arm to include

the high-value production o coriander, let-

tuce, and potatoes. As a result, Rodriquezs

net sales per hectare jumped rom $1,315

beore such MCC-unded technical training

to $6,142 in 2008 and $9,892 as o August

2009. Women armers are increasingly

benetting rom MCC-unded training in

horticulture production. In 2006, only seven

women armers participated in the program.

As o September 2009, that number skyrock-

eted to 440.

parr wh r hrh a ra arah

Jordans water sector is changing rapidly, and policy

and institutional reorms are needed to ensure the

impact and long-term sustainability o proposed MCC

investments. MCC has worked closely with the Jorda-

nian government and other donors to ensure that the

investments proposed or Jordans compact program

reinorce the recently adoptedNational Water Strate-gy. In particular, the proposed investments would sup-

port eorts to reduce water losses due to leaking pipes,

poor connections, or weak administrative controls; to

restructure taris and establish water companies that

will manage water resources on a commercial basis;

to limit groundwater extraction to sustainable levels;

and to substitute treated wastewater or reshwater

resources, wherever possible.

Moldova has agreed to drat and support the enact-

ment o a newWater User Association Law, to be

presented to the Parliament or approval and ocial

publication early in the compacts lie and prior to the

start o any rehabilitation construction. In accordance

with international best practices, the enactment o the

new law will create a solid legal oundation to transerresponsibility or management and operation o irriga-

tion systems rehabilitated with MCC unding rom the

state to existing and newly-created water user associa-

tions to sustain agricultural productivity.


24/102


Maximizing the value o U.S. development dollars invested abroad means closer coordination among U.S. Government

agencies providing such unds. Tis coordination minimizes waste and costly duplications, and builds an integrated way

o achieving sustainable results.

Te United States rade and Development Agency

(USDA) awarded grants to three MCC partner

countriesMorocco, Ghana, and El Salvadorto und

technical assistance and easibility studies to support

MCC-unded projects and stimulate private sector

activity to sustain those projects. USDA awarded a

$, grant to MoroccosNational Oce o Fisher-ies or technical assistance associated with necessary

cold storage inrastructure to complement the Moroc-

can compacts small-scale sheries project. Tis ol-

lows a previous $, USDA grant to Morocco or

cold storage capabilities to reduce losses in palm date

production related to MCC-unded ruit tree produc-

tivity projects. USDA also provided $. million in

grants to support MCC-unded projects in El Salvador,

providing technical assistance to the Municipality o

Chalatenango, the National Development Commis-sion, and the Salvadoran Foundation or Economic and

Social Development (FUSADES). Similarly, in Ghana,

USDA provided a $, grant to support the de-

velopment o an agricultural leasing sector to promote

mechanized arming and higher crop yields or small-

holder armers benetting rom the MCC compact.

From the earliest days o compact development, Sen-

egal partnered and coordinated with all stakeholders

in the Senegal River Valley, including USAID and the

United States Department o Agriculture to ensure

that MCCs investments would be complementary to

other existing and planned investments throughout the

region and would be supported by other donors.

parr wh hr u.s. gr a hrh a ra arah

a Bridge to Progress

To go to the market, we had to cross the

river bed every day, without any security

conditions and we often put our lives at risk.

Today, we are happy becaus e we calmly cross

the bridges,explains Antnia Cndida. At

our age, for the tranquility we need, this is a

great work. Thats all we needed for a future

with progress,adds Paula Ins. Both are

residents o Paul on Santiago Island in Cape

Verde. Part o the island-nations $110 million

MCC compact built critical inrastructure,

such as bridges, to increase economic activ-

ity and acilitate access to markets.


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23pARtneRsHips tHAt deliveR

As the number o MCC partner countries increases , we

maximize our investments by strengthening our coopera-

tion with other development partners. For example, inlate , we signed a memorandum o understanding

with both the Danish Ministry o Foreign Afairs and the

Agence Franaise de Dveloppement to expand coordi-

nation in partner countries. MCC activities build on and

complement other donors work, resulting in valuable cost

and time savings.

MCC joined theWorld Bank, Arican Development

Bank, European Union, the Netherlands, and Spain

to purchase equipment and provide technical assis-tance in Cape Verde to help create one o the worlds

most transparent and ecient public nancial man-

agement systems.

In Vanuatu, both the Australian Agency or Interna-

tional Development (AusAID) and New Zealands In-

ternational Aid and Development Agency (NZAID)

are providing supplemental unding to complete

roads proposed under the MCC program. AusAID

is rehabilitating three roads and is helping the Public

Works Department develop long-term inrastructure

maintenance capability. NZAID is adding NZ$ mil-

lion (US$ million) to MCC unding to nish another

major road.

TeWorld Food Program (WFP) signed a memoran-

dum o understanding with MCC in December o

that outlines cooperation in agricultural production,policy and program reorms, and gender integration,

all o which strengthen local markets and help achieve

sustainable ood security. Already, MCC and the WFP

are seeking ways to develop synergies in countries o

mutual ocus between MCC-unded investments in

market-access inrastructure, technology transer, land

reorm and property rights, and access to water, inputs,

and nance and WFP-unded programs supporting

domestic ood purchase initiatives that involve devel-

oping procurement systems or locally-grown ood.Tis includes purchases o ood produced by armers

and armer groupsbenetting rom MCC and the

Alliance or a Green Revolution in Arica (AGRA)

programsto be distributed in schools, clinics, and

other public and private institutions.

parr wh r hrh a ra arah

creating JoBs in Honduras

Id like to generate more job opportunities.Im sure more producers from my commu-

nity will see this example and do the same,

stated Raael Antonio Andino Rodriquezo

Honduras. Through technical assistance and

training provided through the rural develop-

ment program o Hondurass MCC compact,

Rodriquez learned modern systems and

technologies to boost his productivity and

protability. With his traditional approach,

his onion yields were 3,246 kilograms

per hectare. Now, through what he has

learnedrom using contour plowing to

maintaining drip irrigation systemsRo-

driquez managed to produce a yield o

78,893 kilograms per hectare in 2008. His

net income skyrocketed rom $376 to

$16,329 per hectare, allowing him to invest in

an irrigation system and improvements to his

home. Most important, Rodriquezs training

allowed him to expand and create jobs. His

labor orce increased rom 120-person days

beore the MCC-unded training to 342

person-days in 2008.


26/102


Partner countries are doing more to leverage MCC

unding through innovative nance mechanisms with

the private sector. Tey are also using MCC compactsto attract investments, connect MCC beneciaries to

global markets, and spur trade.

As MCC partner countries develop their projects,

MCC continues to talk with the private sector

about ways o increasing the impact o MCC

unding. During the past year, the Philippines and

Malawi have sought private sector advice or their

MCC proposals, issuing Requests or Inorma-

tion (RFIs) to solicit written eedback. MCCspartner countries are using these private sector

dialogues and RFIs to learn best practices rom

the private sector, solicit inormation about tech-

nology solutions to identied growth constraints,

and generate opportunities to leverage compact

unds with private sector nancing, trade, and

investment.

El Salvadors FOMILENIO (the Salvadoran entity

responsible or implementing the compact) ap-

proved a $ million public-private participation

agreement with Virginia-based AES Corporation,

leveraging more than $ million rom AES and the

Government o El Salvador. Tis arrangement will

support , kilometers o new rural electrica-

tion lines, connections, and extensions o existinglines throughout the countrys Northern Zone.

Combined with an existing public-private partici-

pation agreement, over , poor amilies in

the area who do not have access to electricity will

be connected to the grid.

Malawi has proposed a renewable energy project

that would help increase access to electricity or

the percent o the population that currently

does not have access. Increased access to elec-

tricity could also stimulate potential agricultural,

agro-processing, and business activity. Malawis

proposal includes an innovative, public-private

partnership approach that could include a

perormance-based nancing structure in order

to maximize the number o beneciaries obtain-

ing access to electricity. MCC is helping Malawi

identiy and promote investment opportunities

and income-generating activities around uture

energy sites.

Ghanas MiDA (the Ghanaian entity responsible

or implementing the compact) is beginning to

leverage compact unding with private sector

commitments. For example, a large international

production and marketing company is exploringsourcing its European market rom compact-

unded Ghanaian pineapple arms and consider-

ing long-term contracts with compact-supported

Ghanaian armers. Tis company has identied

arms with which it may contract, including medi-

um-size arms that work with small out-growers,

urthering economic benets or smallholders.

Farmers are expected to benet rom training to

world-class quality and sanitary standards, less ex-

pensive globally-sourced inputs, and the potentialto increase the productivity o their operations.

parr wh h ra r hrh a ra arah


27/102

25tAngiBle Results

Our commitment to investing in results signals our commitment to transparency and accountability. This scal year

marked the groundbreaking launch o the results section on MCCs website, a gateway to MCCs results as they

emerge rom every stage o our poverty reduction partnerships worldwide. A pioneering compilation that strives to

be unique and comprehensive, the results section showcases MCCs cutting-edge approach to managing or results

and using inormation to improve decision-making. Planning, measuring, and tracking results are essential or deliver-

ing on our investments.

ForwarD thinking

PartnershiPs that Deliver

tAngiBle Results


28/102


mcc ya arah ah r

Constraints Analysis

Beore any compact project is proposed, typically MCC asks partner countries to

undertake a constraints analysis to identiy the primary impediments to economicgrowth in the country. Tis exercise helps ocus country proposals on programs that

will remove barriers to growth and poverty reduction.

Economic Rate o Return Analysis

MCCs unique approach to poverty reduction through economic growth includes

analyzing each program to determine its likely economic impact, as refected in an

economic rate o return (ERR). Te ERR compares a projects costs and benets and

incorporates actors that will determine the sustainability o the proposed investment.

MCC economists calculate the additional income expected to be earned by bene-

ciaries as a result o a project and compare it to the projects overall costs. As part oour commitment to transparency, we make all ERR data available to the public on our

website.

Benefciary Analysis

Te ERR analysis projects the total new household income that is expected to be

generated by MCC investments, but it does not provide direct inormation on which

households are likely to receive those benets. Beneciary analysis represents an

extension o the ERR analysis by describing which segments o society will benet

rom increased incomes. Beneciary analysis can help determine the impact o MCC

projects on particular populations, such as women, the aged, children, and regionalor ethnic sub-populations. Early discussions o the distributional implications o

initial designs provide opportunities to consider revised or alternative implementa-

tion approaches that might generate better distributional outcomes, higher ERRs, or,

sometimes, both.


29/102

27tAngiBle Results

Monitoring and Evaluation

o ulll MCCs commitment to deliver results, monitor-

ing and evaluation (M&E) is integrated into all phases ocompact development and implementation. We collabo-

rate with a partner country to nalize program benchmarks

and to create an M&E plan, which tracks perormance on

processes and outputs at the beginning o a compacts lie.

MCC then tracks outcomes and impacts at the end o a

compact to assess how activities have aected poverty and

economic growth. Achievements are reported throughout

the compacts liecycle.

Impact EvaluationImpact evaluation also contributes to our ocus on results.

MCC is carrying out rigorous, scientic impact evaluations

in every compact, covering roughly percent o all activi-

ties and almost percent o all unds. We hire proession-

al researchers to conduct independent impact evaluations

o key programs. Tese analyses measure the changes in

individual, household, or community income and well-

being that result rom a particular project or program by

comparing the nal results with a credible estimate o what

would have happened without the project. Evaluators es-tablish this counteractual scenario by conducting extensive

surveys and data collection o project participants and a

statistically similar comparison group. In addition to these

impact evaluations that are contracted at the start o each

compact and designed into implementation approaches,MCC plans to contract independent evaluations or most

o the remaining activities as part o the compact close-

out process. In many cases, these evaluations will also use

baseline and endline data to assess the impact o programs.

Te results o these evaluations and their supporting data

will be made publicly available on our website, and we ex-

pect such results to guide uture investment decisions.

Increasing Government ransparency in

Delivering ResultsRefecting a commitment to transparency and account-

ability, MCC is a trailblazer in making inormation about

results accessible to the general public. Trough www.

mcc.gov, visitors can access spreadsheets detailing the ERR

calculations, monitoring indicator tracking tables, and

summarizing impact evaluations. Constraints analyses,

beneciary analyses, and impact evaluation data can be

viewed too. We not only make this inormation available

to the public but also encourage eedback on it rom our

stakeholders.

green develoPment

Together with partner countries, MCC recog-

nizes that sustainable economic growth and

a healthy environment are interdependent.

In Morocco, we see an excellent opportu-

nity to maximize this critical relationship.

Moroccan artisans have traditionally used

techniques that burn tires, wood, and other

materials, producing signicant amounts

o oten toxic smoke, which pollutes the

environment and harms public health. Part

o MCCs $697.5 million poverty reduction

grant to Morocco will help address this

problem. The MCC-undedArtisan and Fez

Medina Projectwill assist the potters o Fez

and Marrakech in meeting growing demand

or high-quality Moroccan pottery by invest-

ing in modern techniques and equipment,

including cleaner-burning kilns. Replac-

ing traditional kilns with modern ones in

Morocco will improve the quality o lie or

artisans.


30/102


R wh Rby

MCC is committed to maximizing the value o every dollar invested in the ght

against global poverty and sometimes must make tough choices regarding com-

pact partnerships, whether this means terminating assistance because o an un-democratic change in government; or deciding not to und certain compact proj-

ects due to poor policy perormance; or restructuring project activities because o

changing market conditions, cost escalations, or new inormation resulting rom

updated easibility studies. Given our willingness to make necessary changes to

realign resources most eciently, MCC exercises a dynamic, fexible approach

that allows us to deliver results that are meaningul and sustainable.

Summary of Project reStructuringS and re-allocationS

Country Project Restructure Cause Solution Implemented

Ar me ni a I rri ga ti on

Infrastructure

Dollar depreciation

Increased input costs

Project re-scoped to reduce the number

of components to be repaired, focusing

on irrigation infrastructure with high

ERRs that can be completed within the

compact term

Mongolia Rail Project Unable to complete the nancial

audit of the UBTZ Railroad, the major

condition precedent to the project, the

Government of Mongolia notied MCC

in April 2009 that it must withdraw the

rail component from the compact.

Re-allocate funding from rail project to

the expansion of the three remaining

projects (Health, Education, Property

Rights) and explore potential new proj-

ects

Ghana Transportation,

Agriculture, and

Rural Development

Increased project costs Re-allocation of funds among projects

Summary of Project HoldS, SuSPenSionS, and terminationS

Country Project Restructure Cause Solution Implemented

Armenia Roads Due to a pattern of actions by the

Government of Armenia inconsistentwith the criteria used by MCC to deter-

mine eligibility for assistance, the MCC

Board decided to place an operational

hold on the project, leading MCC to fully

disengage from the road project as of

September 2009.

Project re-scoped to reduce the number of components to be

repaired, focusing on irrigation infrastructure with high ERR sthat can be completed within the compact term

Nicaragua Property Regulariza-

tion

Pattern of actions by the Government

of Nicaragua inconsistent with the crite-

ria used by MCC to determine eligibility

for assistance. Electoral irregularities

were reported surrounding the Novem-

ber 2008 municipal elections.

Funding for all activities in this project was terminated.

Nicaragua Transportation Pattern of actions by the Government

of Nicaragua inconsistent with the crite-

ria used by MCC to determine eligibility

for assistance. Electoral irregularities

were reported surrounding the Novem-

ber 2008 municipal elections.

Terminated funding for road works not yet contracted,

including upgrading a major stretch of the Pacic Corridor

Highway, and technical assistance to the Government of Ni-

caragua. Continuing with upgrading 18 kilometers of highway

and 50 kilometers of rural secondary roads.

H on du ra s Tr an sp or ta ti on P atte rn o f a ct ions b y the c ou ntry

inconsistent with the criteria used

by MCC to determine eligibility for

assistance. The manner of the removal

of the President and the failure to rees-

tablish democratic order in Honduras

are contrary to sound performance on

MCCs eligibility criteria, which require

countries to demonstrate a commitment

to just and democratic governance.

In September 2009, MCCs Board voted to terminate as-

sistance for the vehicle weight control activity, representing

approximately $5 million. This termination became eective

as of October 2, 2009. In addition, MCC placed a hold on

MCC funding related to the Tegucigalpa to Villa de San Anto-

nio section of highway CA-5, which is jointly nanced by MCC

and the Central American Bank for Economic Integration.

Honduras Rural Development Pattern of actions by the country

inconsistent with the criteria used

by MCC to determine eligibility forassistance. The manner of the removal

of the President and the failure to rees-

tablish democratic order in Honduras

are contrary to sound performance on

MCCs eligibility criteria, which require

countries to demonstrate a commitment

to just and democratic governance.

In September 2009, MCCs Board voted to terminate as-

sistance for approximately 93 kilometers of farm to market

roads, representing approximately $5 million of MCC funding.This termination became eective as of October 2, 2 009.

Madagascar Compact terminated Undemocratic transfer of power. MCCs Board decided in May 2009 to terminate the compact.

Termination was eective August 31, 2009 with administra-

tive closure to be completed in early December 2009.


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29tAngiBle Results

Results at a Glance

Commim scor: a Comc CoriMiio usd, to $7 iio ( o smr 30, 2009)

trorio 38%

aricr 22%

ic & erri dom 7%

Wr s & siio 8%

h, ecio & Commi sric 6%

gorc 4%

er 4%prorm amiirio & Ori 9%

Moiori & eio 2%


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Mali

Morocco

Mozambique

Output

Number of farmers trained

102,181

farmers trained

Armenia ........................30,150

Cape Verde ..........................83

El Salvador ......................3,751

Ghana............................. 19,667

Honduras ........................5,997

Madagascar* ................35,123

Nicaragua ........................7,410

Cape Verde

Morocco

Mozambique

Output

Number of

enterprises assisted

1,499

agribusiness assisted

Armenia ..............................106

El Salvador ...........................38

Georgia.................................188

Ghana ................................... 413

Honduras ............................416

Madagascar* .....................338

Burkina Faso

Mali

Output

Value of agricultural

and rural loans

$38.2 million

in agricultural

and rural loans

Armenia .........$4.228 million

Cape Verde ......$.252 million

Georgia** ........$9.613 million

Ghana.............$13.105 million

Honduras ............$9.9 million

Madagascar*** $1.08 million Armenia

Burkina Faso

Ghana

Mali

Morocco

Mozambique

Output

Number of hectares

under production with

MCC support

15,571 hectares

under production

Income increase

attributable to MCC

activities will be measuredby impact evaluations

El Salvador ...3,392 hectares

Honduras ....6,000 hectares

Nicaragua ......6,174 hectares

Cape Verde .........................4.5

Outcome

Increase in income

MCC investments in agriculture

aim to increase incomes by

creating jobs in the agriculture

sector; increasing farmers

capacity, productivity, and

access to markets; improving

access to credit; and

strengthening agribusiness.

Indicator

Type

Progress

Indicators

Totals

Pending

Implementation

Currently

Implementing

All program data are as of September 30, 2009. Data are preliminary and are subject to adjustment. *MCCs compact with Madagascar has been

terminated. Final project num bers are not available yet. ** This number has been revised downward to rectify an error in last quarters reporting onValue of Agriculture Loans (Georgia) ***The value of loans indicator for Madagascar includes both agricultural and non-agricultural rural loans.

Capacity Building of Farmers

Other Support to Farms & Agribusiness

(irrigation, inputs, credit, and marketing support)

Growth in

Agricultural Sector &

Employment Generation

Results in Agriculture

102,181rmr ri

1,499rii i

15,571cr r rocio

wi MCC or

$38.2 miioi ricr rr o


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31tAngiBle Results

Process

Value of signed contracts for

feasibility, design, supervision

and program mgmt contracts

$43 million in

studies contracted

Armenia .......................$7.67M

Burkina Faso ................$0.3M

Ghana..................................$7M

Morocco .....................$18.95M

Nicaragua ......................$0.7M

Process

% disbursed for

contracted studies

39% disbursed for

contracted studies

Armenia .............................35%

Burkina Faso ....................78%

Ghana ....................................9%

Mali ........................................3%

Morocco ...............................5%

Nicaragua ....................... 100% Burkina Faso

Ghana

Morocco

Nicaragua

Process

Value of signed contracts for

works for irrigation systems

$133.2 million in

works contracted

Armenia .......................$47.8M

Cape Verde ......................$6M

Mali ...................................$79.4

Burkina Faso

Ghana

Morocco

Nicaragua

Process

% contracted irrigation

works disbursed

32% of contracted

irrigation system

works disbursed

Expected upon

completion of works

Armenia ...............................4%

Cape Verde ......................80%

Mali .......................................12%

Outcome

Expected upon

completion of works

MCC investments

in irrigation include

the construction and

rehabilitation of irrigation

systems and watershed

management systems. They

aim to increase income and

productivity of agricultural

producers.

Indicator

Type

Progress

Indicators

Totals

Pending

Implementation

Currently

Implementing

All program data as of September 30, 2009. Data are preliminary and subject to adjustment.

Procurement for Works(4 to 8 months)

Feasibility and/or Detailed DesignIncludes Environmental Impact Assessments,

Environmental Management Plans, and

Resettlement Action Plans, as applicable

(6 to 12 months)

Construction(1 to 5 years)

ExpectedOutcomes(up to 15 years)

$43 miiocorc or iii, i, -

riio /or rorm m-

m corc

39%ir, corc ii-

i, i, riio /or

mm corc or c,

i, or wr coc

m

$133.2 miiocorc or irriio m

corcio

32%ir, irriio m work

corc

Results in Irrigation


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35/102

33tAngiBle Results

Senegal

Output

Preparatory Studies

Completed; Legal and

Regulatory Reorms Adopted

39 studies completed;

8 legal and regulatory

reorms adopted

Benin ..........16 studies; 0 reforms

Burkina Faso 0 studies; 1 reform

Ghana .............4 studies; 1 reform

Lesotho .......... 1 study; 0 reforms

Madagascar ..8 studies; 4 reforms

Mali ...............0 studies; 2 reforms

Mongolia .....5 studies; 0 reforms

Mozambique . 1 study; 0 reforms

Nicaragua ..4 studies; 0 reforms

Burkina Faso

Namibia

Senegal

Output

Stakeholders Reached

122,519 Stakeholders

Reached

Benin .............................38,960

Ghana ...............................5,458

Lesotho ................................125

Madagascar ....... unavailable

Mali .......................................614

Mongolia ...........................7,921

Mozambique.....................406

Nicaragua ....................69,035

Burkina Faso

Lesotho

Mali

Senegal

Output

Buildings Built or

Rehabilitated; Equipment

Purchased; Personnel Trained

122 Buildings built/

rehabilitated; $7.52 million

in equipment purchased;14,307 personnel trained

Benin ...........................0 bldgs;

$0.88 mil; 62 trained

Ghana..........................0 bldgs;


Madagascar ...........114 bldgs;

$4.8 mil; 12,216 trained

Mongolia ....................0 bldgs;


Mozambique.............0 bldgs;


Nicaragua ..................8 bldgs;

$1.69 mil; 1,610 trained

Benin

Burkina Faso

Lesotho

Mali

Mozambique

Namibia

Senegal

Output

Rural Hectares (Ha)

mapped/ormalized; Urban

Parcels mapped/ormalized

1,069,116 rural hectares

mapped; 49,680 rural

hectares ormalized; 2,454urban parcels ormalized

Ghana .................3,501 rural Ha mapped

Madagascar ...................................46,392

rural Ha mapped and formalized

Mongolia ......988,334 rural Ha mapped

Nicaragua ....30,889 rural Ha mapped;

3,288 rural Ha formalized;

2,454 urban parcels formalized

Outcome

Eective Property Rights

System

Reduced Transaction Costs

Increased Tenure Security

Improved Allocation of

Land

Increased Transactions and

Investment in Land and

Property

Increased Land

Productivity and Value

Indicator

Type

Progress

Indicators

Totals

Pending

Implementation

Currently

Implementing

All program data are as of September 30, 2009. Data are preliminary and subject to adjustment.

Institutional Upgradingand Capacity Building

PublicOutreach

Regulatory, Legal,and other Work

Clarifcation andFormalization oLand Rights

ExpectedOutcomes(up to 20 years)

i i i i l i i l i .

14,307kor ri i ri-

rio, ri, cofic ro-

io, i, i-

io, mm /or w

cooi

49,680rr cr ormiz

2,454r rc ormiz

122,519kor rc

8 ror

rorm o

Results in Property Rights and Land Property


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Compact Portolio Perormance

commitmentS and diSburSementS aS Percent of comPact total

cyey i

F d

cp t

( usd )

% c

hh FY09Q4

% db

hh FY09Q4

Madagascar Jul-05 $109.77 79% %

Honduras Sep-05 $215.00 % %

Cape Verde Oct-05 $110.08 % %

Georgia Apr-06 $395.30 % %

Vanuatu Apr-06 $65.69 % %

Nicaragua May-06 $174.71 % %

Armenia Sep-06 $235.65 % %

Benin Oct-06 $307.30 % %

Ghana Feb-07 $547.01 % %

El Salvador Sep-07 $460.94 % %

Mali Sep-07 $460.81 % %

Mongolia Sep-08 $284.91 % %

Morocco Sep-08 $697.50 % %

Mozambique Sep-08 $506.92 % %

anzania Sep-08 $698.14 % %

Lesotho Sep-08 $362.55 % %

Burkina Faso Jul-09 $480.94 % %

Namibia Sep-09 $304.48 % %

Senegal BD $540.00 % %

otal $,. % %

comPact Performance againSt fy09 financial targetS

FY09

t

FY09

a

FY09

P t

c t

hh h FY09

c a

hh h FY09

c

P

Contract

Commitments$ M $,M % $.-. B $. B %

Compact

Disbursements$ M $ M % $- M $ M %

1 Commitment gure o $2.22B represents projections submitted by Accountable Entities as o early Septem-ber 2009 Based on MCCs reporting cycle, F Y09 Q4 commitment actual gures will be available next quarter. MCCexpects FY09 actual gures to be approximately $950 million, based on the delayed signature o several major contractsin Ghana, Georgia, El Salvador, and Morocco until next quarter.

2

Compact disbursement gure includes $917K in disbursements or the Burkina Faso Bright 2 Schools Proj-ect ($817k) and Kenya grant project ( $100k).

* Senegal has been added to the table as o FY09 Q4; the compact was signed on September 16th, 2009


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35tAngiBle Results

In , MCC reviewed, and subsequently revised, estimates o the number

o individuals expected to benet rom compacts. Tese revisions refect

MCCs updated approach to counting beneciaries ex ante, consistent with

our Guidance on Benefciary Analysis, and do not represent corrections o er-

rors in the original calculations. Recognizing that there are oten several ways

to estimate potential beneciaries, this guidance was designed to enhance

the consistency o practices across MCC compacts. Characteristics o the

guidelines include: classiying projects by scope, counting as beneciaries only

the portion o project participants expected to derive an income gain, avoiding

double-counting beneciaries that benet rom multiple projects, and project-ing beneciaries over the long term when relevant. Beneciary estimates will

be updated as new inormation and evidence o actual impacts become avail-

able and will be made available on MCCs website.

1 ypically 20 years.2 Tese estimates do not include beneciaries o projects or activities that have been terminatedor suspended by MCC. In the case o Madagascar, the estimates account or the compacts early termina-tion.3 Tis estimate is still preliminary and subject to urther adjustment.4 Tis estimate is being revised to include benets rom the injection in 2008 o $100m in ad-ditional compact unds.5 Tis estimate does not include beneciaries rom the rail project, which was part o the originalcompact but has since been discontinued at the Governments request. Additional beneciaries rom com-pact re-scoping options currently under review are not refected in the estimate.

Estimating Compact Benefciaries

CompactEstimated Number

o Benefciaries

Estimated Income Gain

over the Long Term1

Armenia 427,6232 $435,000,000

Benin 13,421,000 $435,000,000

Burkina Faso 1,181,296 $186,872,277

Cape Verde 384,765 $178,000,000

El Salvador 904,207 $530,000,000

Georgia 4,592,0003

$292,000,0004

Ghana 1,217,000 $683,000,000

Honduras 1,818,0002 $331,000,000

Lesotho 1,041,000 $375,000,000

Madagascar 462,5942 $123,000,000

Mali 2,837,000 $457,000,000

Mongolia 2,600,0005 $158,000,000

Morocco 973,107 $806,000,000

Mozambique 4,445,000 $632,000,000

Namibia 1,761,029 $335,797,817

Nicaragua 108,9102 $193,000,000

anzania 5,425,000 $1,336,000,000

Senegal 1,662,129 $1,276,532,940

Vanuatu 14,783 $84,000,000

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Threshold Program Update September 2009

Quick Facts

MCC has signed 21 threshold programs with countries totaling nearly$470

million.

O the threshold program countries, eight have become compact eligible.

wo countriesBurkina Faso and anzaniahave signed compacts. Six oth-

ersIndonesia, Jordan, Moldova, Malawi, the Philippines, and Zambiaare

actively developing compact proposals.

USAID administers the majority o the threshold programs. Te U.S. Depart-

ment o reasury administers the Sao ome and Principe program and partici-

pates, along with the U.S. Department o Justice, in several programs by provid-

ing direct technical assistance and training in a number o areas.

Liberia and imor-Leste were selected as threshold eligible in December

and are working to develop program proposals.

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Controlof

Corrup-

tion

Controlof

Corrup-

tionControl

of

Corrup-

tion

Control

of

Corrup-

tion

Controlof

Corrup-

tion

FiscalPolicy

Rule ofLaw

CivilLiberties

PoliticalRights

Voice &Acctblty

Govern-ment

Eecti ve-

ness

Girls'Primary

Ed.

Comp.

Girls'Primary

Ed.

Comp.

BusinessStart-Up

BusinessStart-Up

$0

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

Burkina

Faso

K en ya Mal awi Ni ge r Rw an da Sao

Tome

Tanzania Uganda Zambia

Control of

Corruption




Fiscal Policy

Rule of Law

Civil Liberties

Political Rights

Trade Policy

Business Start-Up

$-$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

$45,000,000$50,000,000

Albania I Albania II Moldova Ukraine Jordan

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Treshold Program Successes

Indonesias threshold program ocuses on increasing immunization rates and

reducing public corruption. Te immunization component concluded in March

, increasing immunization coverage through the use o local health centers

to percent in the targeted districts and helping to vaccinate over ve million

children, as planned, or measles and DP. Te corruption component also

achieved success. Trough trainings on judicial codes o conduct, an increase inwealth reporting by judges, and increased transparency in Supreme Court deci-

sions, the threshold program helped acilitate a change in the Supreme Courts

organizational culture and create momentum within the government and donor

community or continued judicial reorm.

Jordans threshold program concluded in August . Te customs modern-

ization component o the program upgraded customs centers with an inte-

grated risk management system and implemented the single window customs

procedures in ve locations to improve eciency and help eliminate possibilities

o corruption. As a result, the average time to complete the customs clearance

Arica Eastern Europe / Middle East

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37tAngiBle Results

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Control ofC

millenium challenge corporation us report 2009

Documents