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Millennium Challenge Account

Millennium Challenge Account. Fulfillment of Monterrey commitment to “provide greater resources to countries taking greater responsibility for their own development.” Millennium Challenge Account: rewards countries with pro-development policies builds on country ownership and responsibility

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Millennium Challenge Account

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  1. Millennium Challenge Account • Fulfillment of Monterrey commitment to “provide greater resources to countries taking greater responsibility for their own development.” • Millennium Challenge Account: • rewards countries with pro-development policies • builds on country ownership and responsibility • focuses on results

  2. Based on Monterrey Principles • New untied, grant financing • Set aside up front to ensure predictability • Not designated for specific purpose, leaving choice to partner country • MCA targets a single mission: • “reducing poverty through growth.”

  3. Policies • MCC rewards countries doing better than peers on international indicators related to development • Threshold Program helps countries close to qualifying improve policies

  4. Compact Eligible Countries Latin America Bolivia El Salvador Honduras Nicaragua Africa Benin Burkina Faso Cape Verde Ghana Lesotho Madagascar Mali Malawi Morocco Mozambique Namibia Senegal Tanzania Eurasia Armenia East Timor Georgia Jordan Moldova Mongolia Philippines Ukraine Vanuatu

  5. Threshold Countries Africa Burkina Faso* Kenya Malawi* Mauritania Niger Rwanda São Tomé and Principe Tanzania* Uganda Zambia Eurasia Albania East Timor* Indonesia Jordan* Kyrgyz Republic Moldova* Philippines* Ukraine* Yemen Latin America Guyana Paraguay Peru * Country also eligible for Compact funding

  6. Ownership • Eligible countries determine their own priorities and develop their own proposals for MCC funding, after consulting with civil society and private sector. • MCC assesses proposals based on: • The contribution to poverty reduction and growth • The quality of the consultative process and breadth of support • The ability to measure results

  7. Results • MCC and partner governments sign a “Compact” that: • Agrees on specific objectives and measures of success • Elaborates a monitoring and evaluation plan

  8. $5.5 Billion in Signed Compacts($ in million) Benin $307 Honduras $215 Nicaragua $175 Vanuatu $66 Georgia $295 Cape Verde $110 Madagascar $110 Tanzania $698 Mongolia $285 Armenia $236 Ghana $547 Mali $461 El Salvador $461 Morocco $698 Lesotho $363 Mozambique $507

  9. MCC Funding by Sector USD millions

  10. The Ghana Compact $547 million Compact signed August 1, 2006 to: • improve agricultural productivity, increasing production of high-value commercial and basic food crops, • improve access to markets through better transport, • expand availability of community services in rural areas, • foster greater private investment in agriculture. • Expected Results: • Training of 51,000 farm households • Irrigation for 80,000 hectares of land • Employment opportunities for over • 230,000 • Improved welfare and quality of life for • over 1 million people

  11. Status of the Ghana Compact

  12. Lessons Learned/Challenges • Country ownership takes time and commitment • Countries must set and own priorities • Participatory, meaningful, timely consultation on priorities builds support for successful action • There are trade offs • Capacity grows through doing • Graduated assistance often needed • Coordination and harmonization can be full time jobs • MCC (and other development) assistance is only a catalyst • Further efforts to leverage other financing for development essential, especially from private sector

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