Press Release

Millennium Challenge Corporation Signs Compact with Vanuatu

For Immediate Release

March 23, 2006

Port-Vila, Vanuatu Today, the Millennium Challenge Corporation signed a five-year $65.69 million Compact grant agreement with Vanuatu. Charles O. Sethness, MCC Vice President for Accountability led an MCC delegation to Vanuatu to participate in a signing ceremony at the Parliament House in Port-Vila.

MCC congratulates the ni-Vanuatu for a well designed, comprehensive Compact and reaching this important milestone, said Mr. Sethness. The Compact is a testament to Vanuatu’s commitment to reduce poverty and provide hope and opportunity to their people. MCC applauds Prime Minister Lini for his leadership and the hard work of his team. We look forward to building our partnership as we begin to implement the Compact.

Mr. Sethness added, I would also like to recognize and thank Ambassador Fitts and the U.S. Embassy for their collaboration to make this program a reality.

The Millennium Challenge Program is expected to increase average income per capita by 15% within five years and directly impact the lives of more than 65,000 of the rural poor in Vanuatu.

Presently, approximately half of Vanuatu ‘s citizens live in poverty. An island nation comprised of 83 islands in the South Pacific, Vanuatu identified costly and unreliable transportation infrastructure as a major impediment to economic growth. To overcome this constraint, the Compact consists of up to eleven infrastructure projectsincluding roads, wharfs, an airstrip and warehousesthat will help poor, rural agricultural producers and providers of tourist related goods and services reduce transportation costs and improve access to transportation services. The Compact also includes institutional strengthening efforts and policy reform initiatives in Vanuatu ‘s Public Works Department, including: provision of plant and equipment for maintenance; introduction of service performance contracts; establishment of local community maintenance schemes; and introduction of user fees.

Launched by President Bush in 2004, the Millennium Challenge Account is a different approach to development assistance that recognizes sound policies and good governance as critical to poverty reduction and economic growth in developing countries.


Millennium Challenge Corporation (MCC), a U.S. government corporation designed to work with some of the poorest countries in the world, is based on the principle that aid is most effective when it reinforces good governance, economic freedom, and investments in people that promote economic growth and elimination of extreme poverty.