“The MCC is the greatest experiment we’ve had in doing foreign aid right,” boasts Vice President for Policy and Evaluation Sheila Herrling from the Millennium Challenge Corporation’s office in Washington DC. She is content, and with good reason—the results are in from the corporation’s first compacts, or large 5-year grants designed to reduce poverty through economic growth. It was not a given that these programs would be successful when they were initiated, and in an agency that prides itself in complete transparency in order to stave off potential corruption, the criticism would have been significant had there not been returns; they are a government organization, after all. With a total of $7.4 billion worth of projects approved in countries all over the world, they certainly have been swinging big—and so far, it’s been paying off.
Making these tremendous investments based on models and projections is risky business, discloses Herrling. “We’re constantly nervous that things just aren’t going to turn out as planned. But the results already show success for the model and they certainly show success for the countries that we’ve helped. That’s a great sign for the direction we’re headed.”
The MCC decided upon Honduras and Cape Verde as the two sites for the first compact pilot projects after being created by Congress with strong bipartisan support in 2004. Each of the newly-published compact closeout reports for these projects are triumphantly designated a “Success Story” and go on to exult not only the dramatic impacts that the compacts have had on the countries’ economies but also of all the lives that have been changed for the better—in terms of income, health, education, and safety.
What became quickly apparent to the agency was that a 2D approach to economic stimulation would only go so far in a developing country. They adapted accordingly and made gender equality one of their primary focuses for upcoming compacts and thresholds (smaller grants awarded to countries that come close to meeting all of the aid criteria). Herrling explains, “We do a very good job when we’re looking at financial returns, but we needed to adopt a more big-picture approach that looks at exactly who is benefiting from our programs in the long run. A big part of that is asking, ‘Are women benefiting just as much as men?’”
In 2006 the MCC developed a Gender Policy that details how to integrate women into every level of the consultation, planning and implementation processes. Mali serves as an example of where the results of this new approach are already being seen. Women have access to the country’s newly irrigated agricultural land in two ways: through the land allocation process that is coupled with land rights education and agricultural training efforts and through the allocation of market garden plots.
Economic freedom, investments in citizens, and good governance are the primary hurdles that a country must clear to even be considered eligible for aid. Illustrating their commitment to these convictions is the amount of time spent working with the Government of Lesotho to ensure that women’s rights were legally guaranteed in the country before agreeing to sign their Compact agreement. Consequently, women have significantly increased access to the health services implemented by the compact, including maternal and child health as well as HIV/AIDS prevention and treatment.
But in addition to all of the instantly quantifiable results, MCC’s work provides uncounted intangible benefits for the countries it assists, as well as for the U.S. Patrick Fine, Vice President for Compact Operations, asserts that the value of building relationships should not be underestimated:
“When a compact ends with a country, it’s not the end of the relationship between the U.S. government and them; our bilateral relationship continues. And in the context of that bilateral relationship, we certainly continue to care about the agreements and commitments made within the compacts; we don’t just suddenly walk away. We work to maintain the rapport we’ve built with the other country.”
Providing potentially volatile regions with sources of economic stability is indisputably an issue of long-term international security. The world has recently seen glimpses of how food scarcity inflates social unrest in underdeveloped regions, making MCC’s work all the more necessary and urgent. Without their facilitation of large-scale agribusiness practices in Africa and South America, it will prove increasingly difficult to close the gap in the world’s rapidly growing food needs. Any way you look at it, the U.S. will be seeing both immediate and delayed returns from the MCC’s work in development. Says Herrling:
“What I think is so great about these investments is that while our focus is strictly on economics—and we measure our success that way—you can also assess our positive impacts coming from so many different perspectives and looking at so many other indicators. What it all comes down to is: it’s a human issue.“
To learn more about the MCC and their upcoming programs, visit http://www.mcc.gov.
a global affairs media network
Doing More With Foreign Aid
February 27, 2011
“The MCC is the greatest experiment we’ve had in doing foreign aid right,” boasts Vice President for Policy and Evaluation Sheila Herrling from the Millennium Challenge Corporation’s office in Washington DC. She is content, and with good reason—the results are in from the corporation’s first compacts, or large 5-year grants designed to reduce poverty through economic growth. It was not a given that these programs would be successful when they were initiated, and in an agency that prides itself in complete transparency in order to stave off potential corruption, the criticism would have been significant had there not been returns; they are a government organization, after all. With a total of $7.4 billion worth of projects approved in countries all over the world, they certainly have been swinging big—and so far, it’s been paying off.
Making these tremendous investments based on models and projections is risky business, discloses Herrling. “We’re constantly nervous that things just aren’t going to turn out as planned. But the results already show success for the model and they certainly show success for the countries that we’ve helped. That’s a great sign for the direction we’re headed.”
The MCC decided upon Honduras and Cape Verde as the two sites for the first compact pilot projects after being created by Congress with strong bipartisan support in 2004. Each of the newly-published compact closeout reports for these projects are triumphantly designated a “Success Story” and go on to exult not only the dramatic impacts that the compacts have had on the countries’ economies but also of all the lives that have been changed for the better—in terms of income, health, education, and safety.
What became quickly apparent to the agency was that a 2D approach to economic stimulation would only go so far in a developing country. They adapted accordingly and made gender equality one of their primary focuses for upcoming compacts and thresholds (smaller grants awarded to countries that come close to meeting all of the aid criteria). Herrling explains, “We do a very good job when we’re looking at financial returns, but we needed to adopt a more big-picture approach that looks at exactly who is benefiting from our programs in the long run. A big part of that is asking, ‘Are women benefiting just as much as men?’”
In 2006 the MCC developed a Gender Policy that details how to integrate women into every level of the consultation, planning and implementation processes. Mali serves as an example of where the results of this new approach are already being seen. Women have access to the country’s newly irrigated agricultural land in two ways: through the land allocation process that is coupled with land rights education and agricultural training efforts and through the allocation of market garden plots.
Economic freedom, investments in citizens, and good governance are the primary hurdles that a country must clear to even be considered eligible for aid. Illustrating their commitment to these convictions is the amount of time spent working with the Government of Lesotho to ensure that women’s rights were legally guaranteed in the country before agreeing to sign their Compact agreement. Consequently, women have significantly increased access to the health services implemented by the compact, including maternal and child health as well as HIV/AIDS prevention and treatment.
But in addition to all of the instantly quantifiable results, MCC’s work provides uncounted intangible benefits for the countries it assists, as well as for the U.S. Patrick Fine, Vice President for Compact Operations, asserts that the value of building relationships should not be underestimated:
“When a compact ends with a country, it’s not the end of the relationship between the U.S. government and them; our bilateral relationship continues. And in the context of that bilateral relationship, we certainly continue to care about the agreements and commitments made within the compacts; we don’t just suddenly walk away. We work to maintain the rapport we’ve built with the other country.”
Providing potentially volatile regions with sources of economic stability is indisputably an issue of long-term international security. The world has recently seen glimpses of how food scarcity inflates social unrest in underdeveloped regions, making MCC’s work all the more necessary and urgent. Without their facilitation of large-scale agribusiness practices in Africa and South America, it will prove increasingly difficult to close the gap in the world’s rapidly growing food needs. Any way you look at it, the U.S. will be seeing both immediate and delayed returns from the MCC’s work in development. Says Herrling:
“What I think is so great about these investments is that while our focus is strictly on economics—and we measure our success that way—you can also assess our positive impacts coming from so many different perspectives and looking at so many other indicators. What it all comes down to is: it’s a human issue.“
To learn more about the MCC and their upcoming programs, visit http://www.mcc.gov.
