Washington, D.C. — At its quarterly meeting today, the U.S. Government’s Millennium Challenge Corporation (MCC) Board of Directors selected Benin and El Salvador as eligible to develop proposals for new compacts, and selected Nepal and Honduras as eligible to develop Threshold Programs. The Board also approved a $66.2 million compact with Cape Verde.
“Cape Verde has demonstrated an ongoing commitment to building a self-sustaining, high-growth economy through policy and institutional reforms, private sector engagement and infrastructure development,” said MCC Chief Executive Officer Daniel W. Yohannes. “MCC is proud to partner again with this stable democracy—a model for all of Africa—to improve the quality of life for Cape Verdeans in positive and sustainable ways.”
The Government of Cape Verde recognizes that to alleviate poverty it must continue its positive track record of improved policy performance and government reform. This compact provides a unique opportunity to reduce poverty and address critical constraints to economic growth in Cape Verde through projects focused on reforming the water, sanitation and land management sectors.
At the meeting, the Board also selected Benin and El Salvador as eligible to develop proposals for new compacts. These second compacts are contingent on successful completion of first compacts, continued good policy performance, development of proposals that have significant potential to promote economic growth and reduce poverty, and availability of funding.
“Traveling over the last year, I saw firsthand the positive impact that MCC’s compacts are having in both Benin and El Salvador,” said Yohannes. “These countries not only demonstrate the sound policy performance that is required of an MCC partner country, but looking at what they have accomplished in implementation makes me enthusiastic about developing a second compact with them.”
El Salvador was also one of the first countries selected to be part of the U.S. Government’s new Partnership for Growth initiative, which aims to improve coordination, leverage private investment, and focus political commitment to accelerate and sustain broad-based economic growth.
The Board also selected Nepal and Honduras as eligible for new Threshold Programs, and agreed that Zambia, Georgia and Ghana are eligible to continue the process of developing compacts in Fiscal Year 2012. Nepal performs well on the policy indicators on MCC’s scorecard, and with recent landmark agreements on the Comprehensive Peace Accord in place, MCC looks forward to establishing a Threshold partnership with Nepal.
Honduras has previously been a strong MCC compact partner. The MCC Board’s selection of Honduras as eligible for a Threshold Program recognizes recent steps taken by the Government of Honduras (GOH) to address corruption through improved fiscal transparency, and provides an opportunity for MCC and Honduras to begin a Threshold partnership as the GOH continues its broader reform efforts.