The Millennium Challenge Corporation (MCC) is a United States Government corporation designed to work with some of the poorest countries in the world. Established in January 2004 (as a result of President Bush’s address in Monterrey, Mexico in March 2002), MCC is based on the principle that aid is most effective when it reinforces good governance, economic freedom and investments in people. MCC’s mission is to reduce global poverty through the promotion of sustainable economic growth.

Led by a Chief Executive Officer and overseen by a Board of Directors, MCC is responsible for the stewardship of the Millennium Challenge Account (MCA), which receives funds appropriated by Congress every year.

The key principles of the MCA are:

• Reducing Poverty Through Economic Growth: The MCC focuses specifically on promoting sustainable economic growth to reduce poverty through investments in areas such as transportation, water and industrial infrastructure, agriculture, education, private sector development, and capacity building.



• Good Policies Matter (Reward Performance): Using objective indicators, countries are selected to receive assistance based on their performance in governing justly, investing in their citizens, and encouraging economic freedom. Because corruption undermines every aspect of sustainable development, MCC has made fighting it one of its highest priorities.



• Genuine Partnership: Working closely with MCC, countries that receive assistance will be responsible for identifying the greatest barriers to their own development, ensuring civil society participation and developing an appropriate program. Participation requires a high-level commitment from the host government. Each country enters into a public Compact with MCC that includes a multi-year plan for achieving development objectives and identifies the responsibilities of each partner in achieving those objectives.



• Focus on Results: Assistance goes to those countries that have developed well-designed programs with clear objectives, benchmarks to measure progress, procedures to ensure fiscal accountability for the use of our grants, and a plan for effective monitoring and objective evaluation of results. Programs are designed to enable sustainable progress even after the funding under the Compact has ended, and each Compact is designed to be finished in less then five years.

Programs

The MCC provides two different kinds of monetary assistance — compact agreements and threshold agreements.

Millennium Challenge Compacts: A Compact is a multi-year agreement between the Millennium Challenge Corporation and an eligible country to fund specific programs targeted at reducing poverty and stimulating economic growth.

Before a country can become eligible to receive assistance, MCC looks at their performance on independent and transparent policy indicators – 17 different policy indicators measuring the country’s commitment to policies that promote political and economic freedom, investments in education and health, control of corruption, and respect for civil liberties and the rule of law.

Participation in the MCC consists of four steps:

1. Country Selection: MCC first determines a candidate pool, and then uses 17 indicators to help determine which countries in the pool should be eligible to submit a Compact proposals.



2. Compact Development: Eligible countries develop a Compact proposal which is then refined by both the country and MCC.



3. Compact Implementation: If MCC and a country agree on a Compact, then the Country is responsible for the implementation of the programs entailed.



4. Monitoring & Evaluation: As the country does implementation, MCC monitors its progress, and evaluates whether or not a country is meeting the objectives which were agreed upon by the country and the MCC.

Millennium Challenge Threshold Programs: The Threshold Program is designed to assist countries that are on the “threshold,” meaning they have not yet qualified for MCA Compact funding, but have demonstrated a significant commitment to improve their performance on the eligibility criteria for MCA Compact funding. Threshold programs are smaller grants designed to help improve performance on specific indicators.

The U.S. Agency for International Development (USAID), working with MCC, is currently the primary agency overseeing the implementation of the Threshold Program. Other U.S. agencies may also be involved in providing assistance for the Threshold Program.

MCC in Jordan

In October 2006, the MCC signed a $25 million Millennium Challenge Threshold Program Agreement with the Government of Jordan. The program will help the Government of Jordan (GOJ) accelerate implementation of its homegrown reform initiatives focused on improvements in public administration, civil liberties, infrastructure and the economy.

Over two years MCC assistance will fund two initiatives to strengthen municipal governance and to modernize customs administration. USAID is the lead U.S. Government agency tasked with implementing the Jordan Threshold Program.

Read the Jordan MCC Program Fact Sheet [Word Document]

Additional Information

For further information on the Millennium Challenge Account, please visit the Department of State MCA web site.