FREQUENTLY ASKED QUESTIONS
What is the Millennium Challenge Corporation (MCC)?
The Millennium Challenge Corporation (MCC) is an innovative and independent U.S Foreign Assistance Agency that seeks to address global poverty by empowering nations to develop projects to overcome the key inhibitors of sustainable economic growth and promote poverty reduction. The MCC was initiated in 2004 with strong Government wide support. The MCC is unique in that eligible countries must pass a competitive selection process to ensure a policy ready environment and necessary traction for projects to have broad based impact. Further, solutions and implementation are country led. Partner Governments are selected based on their commitment to (1) economic freedom (2) good governance (3) investing in their people. Once countries have met these pre-conditions, the MCC supports the partner government to develop projects for funding through a grant, which is intended to have country wide impact and transform the lives of citizens through sustainable economic.
What is the MCC Scorecard?
The MCC Scorecard is made up of 20 indicators across three categories: Economic freedom; ruling justly; and investing in people. These indicators assess the level at which the political, social and economic conditions in a country support sustained economic growth that is both participatory and inclusive. Find the list of indicators in the table below. The Scorecard is a tool to monitor policy performance. The performance of each selected country is assessed against a median score which is calculated from the composite score of all the countries within that income group. For the Political Rights, Civil Liberties, Inflation and Immunization indicators; an absolute threshold score is calculated which each country must pass. Three indicators: political rights, civil liberties and control of corruption must be passed in order to qualify and each country is expected to pass at least one indicator in each of the three categories. A country is expected to pass at least half of its indicators in order to qualify.
How is data for the Scorecard generated?
The data for the Scorecard is generated by reliable and credible third party sources such as the Freedom House, World Health Organization and World Bank. These data sources should be accessible to the public and have an analytically rigorous methodology. Furthermore, the indicators are expected to be broad based, generated in a consistent manner, and standardized in order to allow for cross country comparisons. Click on the link at the end of this page to view data sources
When is the MCC Scorecard published?
The MCC Board of Directors meets each December selects partner countries eligible to receive grant assistance based on their scorecard performance, relevant supplemental information, the overall opportunity to reduce poverty and generate economic growth, and available funding. As such, scorecards for individual countries are published weeks prior to this meeting, normally, first week November.
Which countries are eligible to participate in the MCC?
The MCC board identifies countries for aid in a transparent manner. Each of these countries must demonstrate a commitment to good governance, investing in its people and economic freedom. The MCC established a four-step process to select countries for aid:
- Identify candidate countries
- Publish selection criteria and methodology for country selection and accept public comments
- Issue candidate country scorecards
- Select countries eligible for MCC program assistance
- Is engaged in activities that are contrary to the national security interests of the USA
- Is engaged in a pattern of activities that are inconsistent with the eligibility criteria
- It has failed to adhere to its responsibilities under a MCC agreement
What is a Threshold Program?
A threshold program is a contract between the US Government and the partner Government that is used to improve policy and institutional reform to make a country compact ready. It facilities dialogue between the partner country and the US government while ensuring recipient country ownership. These programs are run by the USAID and last for a year. At the end of the program, a lessons learned document is generated by the MCC through an independent evaluator to ensure accountability to stakeholders
What is the average funding and duration of a Threshold Program?
Approved amounts and durations for Threshold Programs differ per country and is informed partly by the outcome of the first three phases of the program (introduction, analysis, and design) prior to implementation. Nonetheless, Sierra Leone is reported to have received one of the highest Grant amounts for a Threshold Program, to the tune of US$ 44.4 million and a completion date of 4 year from the date the Grant entered into force (16 February 2016).
How does a country become eligible for a Threshold Program or a Compact?
A country becomes eligible for a threshold program by passing less than half of the indicator; however, has the potential of meeting the requirements for compact development with additional support for policy reform on key strategic areas. A threshold program is a contract between the US Government and the partner Government that is used to improve policy and institutional reform to make a country compact ready. It facilitates dialogue between the partner country and the US government while ensuring recipient country ownership. These programs are run by the USAID and last for a year. At the end of the program, a lessons learned document is generated by the MCC through an independent evaluator to ensure accountability to stakeholders.
What happens if a country loses eligibility during the compact development phase?
If a country loses eligibility as a result of poor performance on its indicators, the country will be asked to develop an action plan that will improve its policy performance. They will be asked to demonstrate a concerted effort towards improving their policy environment through open dialogue with the MCCC. In a situation where a country is suspended from the process, it would be for one or more of the following reasons:
A country becomes eligible for a compact by passing at least half of the indicators on the scorecard in each of the three categories; economic freedom, ruling justly and investing in people. At a minimum, each country should pass the democratic rights and control of corruption indicators. A Compact is a multi-year agreement between the US government and the partner Government to fund projects to sustainably reduce poverty and improve economic growth.
How is the MCC Board different from the MCCU Board?
In accordance with the Implementation Arrangement indicated in the Grant Agreement, the governance structure of the Accountable Entity (MCCU) will include a board of directors (MCCU Board) that will have ultimate responsibility for the oversight, direction, and decisions of the Accountable Entity, as well as the overall implementation of the Program. It is comprised of seven voting members. The MCCU Board includes the following representatives: (a) The Vice President, who will serve as the chair of the Board; (b) Minister of Energy; (c) Minister of Water Resources; (d) Minister of Finance; and (e) Three non-Government representatives (e.g., representatives from the private sector, civil society, and consumer groups). On the other hand, the MCC Board of Directors is composed of the Secretary of State, the Secretary of Treasury, the U.S. Trade Representative, the Administrator of USAID, the CEO of the MCC and four private sector members appointed by the President of the United States with the advice and consent of the U.S. Senate. The Secretary of State is the Chair of the Board and the Secretary of Treasury is the Vice Chair. They MCC Board of Directors meets in December to approve Grants (Threshold or Compact) to eligible countries based on their individual performance on the policy indicators of the scorecard.
What is an “Accountable Entity?”
This is an independent entity with legal personality pursuant to the terms and conditions of the Agreement signed between the Governments of a recipient country of a Grant and the United States, charged with the responsibility to implement the Program and to exercise and perform the Government’s right and obligation to oversee, manage and implement the Program, including without limitation, managing the implementation of the Projects, allocating resources and managing procurements. Such an entity acts in accordance with MCC’s “Guidelines for Accountable Entities and Implementation Structures” provided by MCC or posted on the MCC Website (the “MCC Governance Guidelines”) (to the extent applicable to the Program and as may be further instructed by MCC from time to time). The designation of the Accountable Entity does not relieve the Government of any obligations or responsibilities relating to the agreement, for which the Government remains fully responsible.
How can I report corruption?
Both the MCC and MCCU websites,www.mcc.gov and www.mccu-sl.org makes provision for corruption to be reported and Whistleblowers are assured of protection by law. Also, one can report corruption to the Anti-Corruption Commission directly or on the “Pay No Bribe” platform.