MCA Monitor Blog
February 25, 2008
MCC Signs Largest Compact to Date ($698m) with Tanzania
Posted by Amy Crone at 12:06 PM
Last weekend, as part of his whirlwind tour of five African countries in six days, President Bush signed the Tanzania Compact – MCC’s 16th and largest to date. Although concerns about possible expansion of U.S. military presence in Africa overshadowed the development focus of his trip, President Bush was nevertheless able to draw attention to U.S. investments in “smart power,” like results being achieved through foreign assistance programs in the areas of health, infrastructure, and education.
Tanzania is the 9th African compact signed by the MCC. The $698 million agreement will focus on the infrastructure, energy, and water sectors. The infrastructure projects consist of improving mainland trunk roads, resurfacing airport runways on Mafia Island, and rehabilitating rural roads on Zanzibar and Pemba islands. The energy component is comprised of three projects to improve island electricity, build a hydropower dam in western Tanzania, and repair transmission lines in six regions. The water projects focus on increasing the volume and quality of potable water to supply two urban areas – Dar es Salaam and Morogoro; where pollution has been caused by unplanned urban growth and adverse environmental effects of a dam. The selection of projects in the Compact to mitigate past mistakes speaks to the longer-term view of the Tanzanian government, which is also evidenced by the development coordination body Development Partners Group. The program is in line with Tanzania’s poverty reduction strategy (MKUKUTA is the Swahili acronym) which aims to increase economic growth through improved business and tourism conditions along with stimulating rural development.
As the Tanzania compact process unfolds, there are a couple of interesting things to watch. First is the extent to which smart sequencing of MCC assistance programs will yield greater, and perhaps faster, results. Tanzania is the first country to complete a threshold program and subsequently sign a compact, and also received a pre-compact grant for environmental and feasibility studies. This use of 609(g) funding could be a best practice for sequencing – the $9.8 million grant will launch the studies which must be completed for implementation. The accountable entity will be working concurrently towards meeting prerequisites to entry into force, at which point the clock starts ticking on the five-year agreement. This substantive and ordered preparatory work – addressing corruption issues through the threshold program, getting a head start on implementation with feasibility studies, and forming the accountable entity prior to compact signing – could all add up to efficient entry into force, effective and swift disbursements, and a program that can spend the $142 million each year to raise the income of every Tanzanian by about $3.50.
The second issue to watch will be how the MCC and Tanzanian authorities manage the impact of rising oil prices, depreciation of the dollar and increasing materials costs (which are derailing implementation progress on infrastructure projects in other compacts) on achievement of Compact goals. The MCC is currently reviewing its entire portfolio, as are other donors, to gauge the impact of these global economic trends. We look forward to an open dialogue on their findings.
January 31, 2006
MCC Approves Benin Compact, With a Democracy Condition
Posted by Sheila Herrling at 04:55 PM
Yesterday, the MCC Board of Directors approved a five-year approximately $307 million Compact with Benin, more than half of which goes to revamping the Port of Cotonou. On the heels of the MCC's experience with approving Armenia's compact amid what still look like slippages in "ruly justly" criteria, MCC CEO Danilovich appears to place conditions on the Benin approval:
"The upcoming election is a significant milestone in Benin's history and continued participation in the MCC program requires that a successful election be held on the agreed date and according to the terms of Benin's constitution.”
It looks to me like it's more of a stick than the Armenia case was. And, depending on how the MCC defines "continued participation in the MCC program," it looks an awful lot like classic foreign aid conditionality. Some folks are clamoring that conditinality like this flies in the face of the MCC's "country ownership" principles. I don't agree. I see this as a positive signal that the MCC is reinforcing the principles it was founded on and upon which it determines country eligibility into this select program. That said, with the Armenia case, this Benin case and a recent article noting that The Gambia process was being put on hold, I think it's time for the MCC to introduce a hard democracy hurdle into its selection criteria to ensure greater consistency in the decisionmaking process.
December 06, 2005
CFR's Africa Task Force Gives Nod to MCA
Posted by Sheila Herrling at 02:54 PM
When the CFR released its new task force report "More than Humanitarianism: A Strategic Approach Toward Africa," it noted:
“We will know that the response to this opportunity has failed if, in another ten years, U.S. policymakers link hands once again with other world leaders around Africa’s problems and the world witnesses another global concert to end Africa’s poverty. The United States cannot afford to let another decade go by without effective solutions, and Africa deserves far better."
It argues for stronger U.S. engagement with Africa and fuller integration of Africa into the global economy, particularly to assure reliable supplies of energy, combat terrorism, reduce conflict, control pandemic diseases, and enlarge the worldwide community of democracies. And, amid the criticism of policies and engagement to date, gives one of few thumbs-up to the MCA as an a promising means of strategic engagement with Africa beyond humanitarianism.
I'm still willing to hold out on the promise captured in the rhetoric and the mission concept of the MCA as an innovative foreign aid mechansims. But I do worry that the window of opportunity to show the reality behind the rhetoric is closing. I am working on a piece now evaluating how the MCA was supposed to be different -- more innovative and effective -- than other aid mechanisms against the current reality. I would love to hear others' thoughts on signs of success and signs of concern. There's a lot riding on the MCA's success. -Sheila