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MCC’s use of Governance Indicators. Consumers of 3 rd party indicators Aid allocation for 2 programs Compact Threshold Competition: rule-driven, publicly available data Process: 2 income categories 17 indicators, 3 categories Indicator Ccore > median pass
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MCC’s use of Governance Indicators • Consumers of 3rd party indicators • Aid allocation for 2 programs • Compact • Threshold • Competition: rule-driven, publicly available data • Process: • 2 income categories • 17 indicators, 3 categories • Indicator Ccore > median pass • Pass > ½ indicators in each category + corruption
Indicator Category: Ruling Justly Kenya FY08
Where Does MCC work? • 25 countries eligible for Compacts. 16 Compacts signed; 9 in the pipeline. • About $5.5 billion committed to date for Compacts. • 21 countries eligible for Threshold Program 18 Threshold programs approved to date for roughly $400 million.
MCA Compact Countries Africa BeninMali Burkina Faso Malawi Cape VerdeMorocco Ghana Mozambique LesothoNamibia Madagascar Senegal Tanzania Latin AmericaEurasia Bolivia Armenia El Salvador East Timor HondurasGeorgia Nicaragua Jordan Moldova Mongolia Philippines Ukraine Vanuatu Countries in blue have signed or MCC Board-approved Compacts
Strengths • Transparent system • Distinguish top/bottom performers • Attention to policy performance…Governance matters • Policy dialogue • Incentives
Challenges • Lags • New data sources • Rank change vs. performance change • Fine distinctions
Challenges • Short term tracking • Goal displacement • Credibility