Notice of Entering Into a Compact With the Republic of El Salvador, 62469-62472 [2014-24773]

Download as PDF 62469 Federal Register / Vol. 79, No. 201 / Friday, October 17, 2014 / Notices Affected Public: Students and parents applying for YCC program, YCC program staff, and students in YCC program. Form(s): Total annual respondents: 4,000 students; 4,000 parents; and 244 staff. Annual Frequency: One time for the consent, assent, and BIFs, one time for each round of site visits, and two times for the grantee survey. Comments submitted in response to this comment request will be summarized and/or included in the request for Office of Management and Budget approval of the information collection request; they will also become a matter of public record. (MCC) is publishing a summary of the Millennium Challenge Compact between the United States of America, acting through the Millennium Challenge Corporation, and the Republic of El Salvador. Representatives of the United States Government and El Salvador executed the Compact documents on September 30, 2014. The complete text of the Compact has been posted at http://www.mcc.gov/ documents/agreements/compact112906-elsalvador.pdf. Dated: October 14, 2014. Thomas G. Hohenthaner, Acting Vice President and General Counsel, Millennium Challenge Corporation. Summary of Millennium Challenge Compact With the Republic of El Salvador Dated: October 8, 2014. James H. Moore, Jr., Deputy Assistant Secretary for Policy, U.S. Department of Labor. 1. Overview [FR Doc. 2014–24676 Filed 10–16–14; 8:45 am] BILLING CODE 4510–23–P MILLENNIUM CHALLENGE CORPORATION [MCC FR 14–08] Notice of Entering Into a Compact With the Republic of El Salvador Millennium Challenge Corporation. ACTION: Notice. AGENCY: In accordance with Section 610(b)(2) of the Millennium Challenge Act of 2003 (22 U.S.C. 7701–7718), the Millennium Challenge Corporation SUMMARY: The Millennium Challenge Corporation (‘‘MCC’’) has signed a fiveyear, $277 million compact with the Republic of El Salvador aimed at reducing poverty and accelerating economic growth (the ‘‘Compact’’). The Compact is intended to assist the Government of El Salvador (‘‘GoES’’) to strengthen the investment climate, enhance the role of public-private partnerships in delivering key services, and improve the country’s productivity and competitiveness in international markets. Through intensive policy reforms and an integrated set of investments in the institutional capital, human capital, and physical capital of El Salvador, MCC expects that the Compact will help set the foundation for lasting economic growth and poverty reduction. 2. Background This Compact will build on GoES reforms and initiatives and is informed by consultations with over 200 businesses. First, the Compact will invest in the institutional capital of El Salvador in order to enhance the investment climate by streamlining the regulatory environment and supporting the implementation of public-private partnerships. Second, the Compact will support policy reforms and invest in human capital to improve education quality and better match workforce skills with the demands of the labor market. Third, the Compact will invest in physical capital to reduce logistics and transportation costs by improving key road segments and border infrastructure in major transport corridors. The Compact’s three projects represent a total investment of $365.2 million, of which MCC will contribute $277 million, and the GoES will commit $88.2 million—a 32 percent matching contribution that is well above the 15 percent country contribution required for second compacts with lower-middle income countries. 3. Program Overview and Budget Below is a summary describing the components of the Compact. The budget and expected impacts are preliminary based on due diligence and project appraisal. COMPACT BUDGET OVERVIEW MCC Funding Project GoES Funding Total investment Portion of budget (percent) Millions of US$ Investment Climate Project .............................................................................. Human Capital Project ..................................................................................... Logistical Infrastructure Project ....................................................................... Monitoring and Evaluation ............................................................................... Program Administration ................................................................................... 42.4 100.7 109.6 4.3 20.0 50.0 15.0 15.7 ........................ 7.5 92.4 115.7 125.3 4.3 27.5 25.3 31.7 34.3 1.2 7.5 Total .......................................................................................................... $277.0 $88.2 $365.2 100 4. Summary of Projects and Activities mstockstill on DSK4VPTVN1PROD with NOTICES Investment Climate Project The constraints to economic growth analysis and consultations with investors identified excessive ‘‘red tape’’ and discretionary application of rules as negatively affecting the investment climate in El Salvador. Firms also identified the need for key public VerDate Sep<11>2014 17:59 Oct 16, 2014 Jkt 235001 infrastructure to increase productivity, but tight fiscal constraints and weak institutional capacity limit the ability of the GoES to provide such infrastructure. The Investment Climate Project seeks to address these deficiencies in El Salvador’s investment climate by improving the regulatory environment and the GoES’s capacity to provide key public services in partnership with the PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 private sector through the following two activities: • The Regulatory Improvement Activity will prioritize and promote investment climate reforms with the goal of creating a more efficient and profitable business environment. MCC will support the development of an institutional framework and system, including an independent institution E:\FR\FM\17OCN1.SGM 17OCN1 mstockstill on DSK4VPTVN1PROD with NOTICES 62470 Federal Register / Vol. 79, No. 201 / Friday, October 17, 2014 / Notices focused on continuous regulatory improvement and the prioritization and implementation of a select set of reforms. The reforms will focus on areas critical to El Salvador’s competitiveness in international markets and may include trade facilitation, border crossing and customs procedures, environmental permitting, and harmonization of municipal and national regulations. The regulatory improvement institution will also consider the extent to which regulations can be improved to reduce the potential for corruption. In designing and implementing reforms, the institution will ensure that the proposed reforms are consistent with the GoES’s obligations under international trade and investment agreements, including the Dominican Republic-Central America Free Trade Agreement. As part of the activity, the GoES will commit to review, simplify and potentially eliminate regulations early in the Compact implementation process. Such concrete demonstrations of high level commitment to the reform process will be necessary to achieve a dramatic change in the perceptions of the business climate in El Salvador. • The Partnership Development Activity seeks to enable the GoES to partner with private enterprise in innovative ways to provide critical public services in the face of tight fiscal constraints. The GoES has recently passed several laws to facilitate private investment and trade. Most notably, the GoES legislature unanimously passed a law in May 2013 and subsequent reforms in May 2014 to facilitate publicprivate partnerships (‘‘PPPs’’) in the provision of key public services. MCC will invest in capacity building to properly develop, implement, and monitor such partnerships under this law. MCC will make available funding for transaction advisory services to develop and tender PPPs for two key infrastructure projects. Projects currently under review are the expansion of the El Salvador International Airport and a wind farm. MCC and the GoES are also sponsoring the El Salvador Investment Challenge (‘‘ESIC’’), a program to more efficiently and transparently allocate limited GoES resources to public goods needed to support private investment in the international trade of goods and services. The ESIC generated 74 investment project proposals in its initial call for proposals, of which 13 are being evaluated for the next phase of development. The GoES plans to institutionalize the ESIC as an instrument for attracting private VerDate Sep<11>2014 17:59 Oct 16, 2014 Jkt 235001 investment and will contribute up to $50 million to the ESIC during the term of the Compact. The estimated economic rate of return (‘‘ERR’’) for the Investment Climate Project is 18.56 percent, using a weighted estimate of the calculated ERRs for each activity. Human Capital Project The quality of education in El Salvador is below what the country requires to be competitive in world markets. The Human Capital Project is designed to improve the quality of education and to better match the supply of skills of students coming out of secondary school with the demand of a labor market oriented towards international trade. The project consists of the following two activities: • The Education Quality Activity supports complementary interventions to provide Salvadoran students the benefits of competency-based education, increased classroom time, teachers trained in requisite subject-matters and pedagogical skills, and an institutional and physical environment conducive to learning. MCC’s investment will strengthen the national education system by reforming the laws, policies, and operations that govern continuous professional development for teachers, student assessment, and information systems. The activity will strengthen and expand the implementation of the full-time inclusive school model, which increases classroom time from 25 to 40 hours per week, in an estimated 400 schools grouped in 45–55 clusters, focusing resources on grades 7–12. The curriculum improvement component will focus on English, mathematics, science and information technology, and other 21st century skills. • The Technical, Vocational Education and Training (‘‘TVET’’) System Reform Activity seeks to harmonize the skills supplied by private and public TVET providers with the skills demanded by the labor market. The activity will strengthen the national TVET governance system by supporting legal, policy, and operational reforms within the system. MCC will support the establishment of a public entity governed by a board comprised of an equal number of public and private sector representatives to provide the legal and institutional framework for an integrated TVET system. The activity will also fund TVET curricula development with participation from the private sector, career counseling, and job-matching services. It will also fund the establishment of a framework and standards for accreditation of TVET training organizations and certification PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 of teachers and students. The activity will also strengthen the capacity of the TVET system for identifying labor market trends that will inform the strategic direction of the TVET system, including the establishment of a monitoring and evaluation (‘‘M&E’’) framework and a labor market observatory. The estimated ERR for the Human Capital Project is 11.35 percent. Logistical Infrastructure Project The constraints analysis identified transportation and logistics as main factors contributing to the productivity and competitiveness of Salvadoran exports. Consultations with businesses during Compact development also highlighted certain transportation and logistics deficiencies, including the need to expand and rehabilitate key road segments in the coastal zone of El Salvador. The Logistical Infrastructure Project is comprised of two activities designed to reduce logistical and transportation costs and relieve bottlenecks at critical sections along the logistical corridor that connects the main border crossing with Honduras at El Amatillo, the Ports of La Union and Acajutla, and the international airport: • The Coastal Highway Expansion Activity seeks to relieve congestion at the most transited segment (27 kilometers) of El Salvador’s coastal highway by expanding this road from two to four lanes. The coastal highway is one of the two most important logistical corridors in the country and connects the country’s major logistical nodes along the Southern coastal zone of the country, including its two sea ports (La Union and Acajutla) and the international airport. • The Border Crossing Infrastructure Activity seeks to relieve the freight and passenger traffic congestion at the border crossing into Honduras at El Amatillo by improving a 5.7 kilometer road leading to the border and modernizing the border-crossing facilities on the Salvadoran side. MCC will invest in the construction of control stations at the border, including buildings, internal access and connecting roads, parking areas, water and sanitation, and other infrastructure components that may be necessary for the effective functioning of these stations. The estimated ERR for the Logistical Infrastructure Project is 20.31 percent, using a weighted estimate of the calculated ERRs for each activity. E:\FR\FM\17OCN1.SGM 17OCN1 mstockstill on DSK4VPTVN1PROD with NOTICES Federal Register / Vol. 79, No. 201 / Friday, October 17, 2014 / Notices 5. Program Logic, Expected Results, and Beneficiaries In order for El Salvador to be competitive and raise productivity in internationally-traded goods and services, the factors of production in El Salvador must be competitive on world markets. Those factors include human capital, physical capital, and often logistics/transportation. The institutional environment can also affect productivity. As a result, the Compact takes a multi-pronged approach to enhance El Salvador’s competitiveness in these factors of productivity. By streamlining the business environment, improving the quality of education, and reducing transportation and logistics costs, MCC’s investments are intended to increase the productivity of current firms involved in the trade of international goods and services, which is expected to increase current production (and subsequently, employment). Firms are then expected to invest new revenues in more productive technology to realize greater returns on future production. Higher employment and output are expected over time through this self-reinforcing feedback loop which is enabled by greater productivity in traded goods and services. The expected beneficiaries of the Regulatory Improvement Activity are the firms operating in El Salvador (currently more than 25,000) that will experience cost savings as a result of regulatory reforms. The potential expansion of the El Salvador International Airport under the Partnership Development Activity is expected to decrease delays and travel costs for travelers, while the wind farm project would increase the GoES’s ability to attract investment for renewable energy. The beneficiaries of the ESIC are expected to be those firms whose proposals are selected for grant funding, workers who realize net income gains associated with employment as a result of the projects, and third parties who benefit from the public investment. MCC expects the Human Capital Project to directly benefit students in grades 7–12 in general and technical education, who realize higher incomes as a result of more years of education. In particular, the project is expected to contribute to preventing or postponing the dropout of approximately 176,000 students. Direct beneficiaries of the TVET System Reform Activity are expected to be TVET students who receive higher incomes as a result of receiving skills that are better matched to labor market needs. Additional VerDate Sep<11>2014 17:59 Oct 16, 2014 Jkt 235001 beneficiaries of the project include students who do not attend a full-time inclusive school but receive increased incomes as a result of improved quality of education that result from the implementation of reforms at the national level. Communities may also experience reductions in crime as a result of the full-time inclusive school model, due to increased permanence in school and lowered social vulnerability of students. The beneficiaries for the Logistical Infrastructure Project are the estimated 171,159 individuals living within five kilometers of either side of the project sites. Because of the nature of the activities as key logistical thoroughfares, benefits in the form of reduced vehicle operating costs and travel time are expected to accrue to individuals and firms that travel along those corridors. 6. 2006 El Salvador Compact Update and Sustainability Information In November 2006, the Millennium Challenge Corporation signed a fiveyear, $460.94 million compact (the ‘‘2006 Compact’’) with the GoES to improve the economic opportunities of Salvadorans through strategic investments in agricultural production, rural business development, education, and transportation infrastructure. The 2006 Compact consisted of the following three projects: 1. The Connectivity Project, to reduce travel cost and time within the Northern Zone, 2. The Human Development Project, to increase the human and physical capital of residents of the Northern Zone and further employment and business opportunities, and 3. The Productive Development Project, to increase production and employment through technical assistance, credit guarantees, and capital investments. The 2006 Compact entered into force on September 20, 2007 and closed on September 20, 2012. Key Achievements of the Compact are as follows: • Connectivity Project: A total of 223.32 kilometers of road, including three large bridges, and 20 smaller bridges were constructed in northern El Salvador to help improve connectivity for farmers and local producers with the rest of the country. This east-west road in the north stretches close to the borders with Guatemala to the west and Honduras to the east, and the improvements have reduced travel time across the Northern Zone from 12 hours to 6.5 hours. • Human Development Project: PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 62471 Electrification: An estimated 35,412 households now have electricity in their homes, thanks to the installation of new power lines and solar power systems, helping to increase the percentage of households with electricity connections in the Northern Zone from 78 percent in 2007 to 90 percent in 2011. Water and Sanitation: MCC funded about 272 kilometers of water pipes as part of the 2006 Compact’s investment in water and basic sanitation that helped connect 7,624 households to potable water. Education: MCC funded the construction of a new technical community college, improvements to a teacher training center, and the expansion and rehabilitation of 20 high schools. The rehabilitation of the high schools alone is expected to benefit more than 9,700 students every year. • Productive Development Project: MCC funding assisted an estimated 17,500 producers through the provision of training, seeds, equipment, and technical assistance. The project provided 30 loans to small and mediumsized businesses in the Northern Zone to develop new or expand investments in the agriculture, tourism and handicrafts value chains. These loans totaled $5.7 million, of which approximately 20 percent went to women-owned businesses. Sustainability: Although no contribution was required from El Salvador during the implementation of the 2006 Compact, the GoES contributed substantially in parallel to the Compact to enhance the success of the program. The Connectivity Project: In the final year of compact implementation (2012), the GoES also carried out two road maintenance reforms, increasing annual road maintenance funding by about $26 million (∼37% increase). At the end of the five years, the GoES allocated an additional $13 million to complete two remaining segments of the Northern Transnational Highway. During the four-month closure period, all activities under the 2006 Compact were successfully completed. The Human Development Project’s activities were extensions of existing GoES programs, built on the National Plan for Education 2021 and designed to strengthen and install permanent capacities in key Salvadoran ministries and institutions. In addition, the Ministry of Education agreed to fund infrastructure and equipment maintenance and continued an agreement with the Gloria de Kriete Foundation to fund scholarship for secondary education through 2014. E:\FR\FM\17OCN1.SGM 17OCN1 62472 Federal Register / Vol. 79, No. 201 / Friday, October 17, 2014 / Notices The Productive Development Project was designed to transition producers to higher-profit activities, generate new investment, expand markets and sales, and create new jobs in ways that stimulate sustainable economic growth and poverty reduction. Actions accomplished to ensure sustainability of investments made under the Productive Development Project included the establishment of contracts between beneficiaries and supported cooperatives and major retailers for the purchase of horticulture and dairy products. The Ministry of Agriculture also incorporated the project’s beneficiaries into its national Family Agriculture Plan, its signature agriculture extension service aimed at improving the profitability of individual and small and medium-sized producers. Environmental and Social Sustainability: As part of an effort to ensure environmental and social sustainability, all Projects included consultations with the public regarding various aspects of their implementation. The design of the Projects, including their major activities, was included in a strategic environmental assessment that was completed prior to implementation. The sustainability of the projects was also enhanced by the institutional capacity building and training in environmental management acquired through the close cooperation among the environmental units of the implementing agencies, the Millennium Challenge Account (MCA), and MCC. The Salvadoran Ministry of Environment (MARN) received Compact funding support to offset the additional regulatory costs associated with the Projects. Over the course of the Compact, collaboration improved between MARN and the environment units of the implementing agencies. The GoES and private sector and civil society organizations have consistently worked to ensure the sustainability of the 2006 Compact and we expect them to continue to support these investments going forward. [FR Doc. 2014–24773 Filed 10–16–14; 8:45 am] BILLING CODE 9211–03–P mstockstill on DSK4VPTVN1PROD with NOTICES NATIONAL SCIENCE FOUNDATION Federal-Commercial Spectrum Data; Workshop The National Coordination Office (NCO) for Networking and Information Technology Research and Development (NITRD). ACTION: Notice—Federal-Commercial Spectrum Data: Understanding AGENCY: VerDate Sep<11>2014 17:59 Oct 16, 2014 Jkt 235001 Information Exchange Needs, Issues, and Approaches. FOR FURTHER INFORMATION CONTACT: Wendy Wigen at 703–292–4873 or wigen@nitrd.gov. Individuals who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1–800–877–8339 between 8 a.m. and 8 p.m., Eastern time, Monday through Friday. DATES: October 21, 2014. SUMMARY: Representatives from Federal research agencies, private industry, and academia will identify R&D in the area of spectrum data requirements that will promote progress toward more efficient spectrum utilization and sharing. SUPPLEMENTARY INFORMATION: Overview The Wireless Spectrum Research and Development Senior Steering Group (WSRD SSG) will hold its next workshop, Federal-Commercial Spectrum Data: Understanding Information Exchange Needs, Issues, and Approaches, on October 21, from 8:30 a.m.–5:30 p.m., at the National Science Foundation, 4201 Wilson Blvd. Room I–1235, Arlington, VA. Dynamic information sharing and management creates innovative opportunities in many areas including network and business intelligence, devices, applications, public safety operations and security; but developing the next generation of spectrum management tools is complex. It requires consensus among stakeholders on several important issues such as: The purpose of collecting and sharing information, the type and minimal amount of data needed, how to get it into the SAS, the necessary level of security, and enforcement. The NTIA and the FCC are increasing their efforts to identify and make available new spectral bands with the understanding that this will necessitate the use of spectrum sharing techniques. To ensure success, it is critical to first determine the spectrum data requirements of the stakeholders in order to create new policy and develop new techniques and procedures for dynamic spectrum usage. The event agenda and information about the webcast will be available the week of the event at: http://www.nitrd.gov/ nitrdgroups/index.php?title=Wireless_ Spectrum_Research_and_Development_ (WSRD)#title Background The Presidential Memorandum, Presidential Memorandum on Unleashing the Wireless Broadband Revolution (http://www.whitehouse.gov/ PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 the-press-office/presidentialmemorandum-unleashing-wirelessbroadband-revolution), released on June 14, 2013, directed the implementation of ‘‘policies for sharing with authorized non-federal parties of classified, sensitive, or proprietary data regarding assignments, utilization of spectrum, system configurations, business plans, and other information’’. The Presidential Council of Advisors on Science and Technology (PCAST) released a report (http:// www.whitehouse.gov/sites/default/files/ microsites/ostp/pcast_spectrum_report_ final_july_20_2012.pdf) in July 2012 that advocated setting up Spectrum Access System (SAS) databases, with a uniform interface analogous to the Internet’s Domain Naming System (DNS), to provide federal information and access restrictions. Over the past three years, the WSRD has held a series of workshops that addressed the challenge defined in these documents. Information gathered from this workshop will be instrumental in helping the WSRD SSG develop recommendations that will be released in a workshop report prepared for the Office of Science and Technology Policy. Submitted by the National Science Foundation for the National Coordination Office (NCO) for Networking and Information Technology Research and Development (NITRD) on October 14, 2014. Suzanne H. Plimpton, Reports Clearance Officer, National Science Foundation. [FR Doc. 2014–24741 Filed 10–16–14; 8:45 am] BILLING CODE 7555–01–P NATIONAL SCIENCE FOUNDATION Advisory Committee for Computer and Information Science and Engineering: Notice of Meeting In accordance with the Federal Advisory Committee Act (Pub. L. 92– 463, as amended), the National Science Foundation (NSF) announces the following meeting: Name: Advisory Committee for Computer and Information Science and Engineering (CISE) (1115). Date/Time: November 13, 2014: 12:30 p.m. to 5:30 p.m., November 14, 2014: 8:30 a.m. to 12:30 p.m. Place: National Science Foundation, 4201 Wilson Boulevard, Suite 1235, Arlington, Virginia 22230. Type of Meeting: Open. Contact Person: Carmen Whitson, National Science Foundation, 4201 Wilson Boulevard, Suite 1105, E:\FR\FM\17OCN1.SGM 17OCN1

Agencies

[Federal Register Volume 79, Number 201 (Friday, October 17, 2014)]
[Notices]
[Pages 62469-62472]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-24773]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 14-08]


Notice of Entering Into a Compact With the Republic of El 
Salvador

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: In accordance with Section 610(b)(2) of the Millennium 
Challenge Act of 2003 (22 U.S.C. 7701-7718), the Millennium Challenge 
Corporation (MCC) is publishing a summary of the Millennium Challenge 
Compact between the United States of America, acting through the 
Millennium Challenge Corporation, and the Republic of El Salvador. 
Representatives of the United States Government and El Salvador 
executed the Compact documents on September 30, 2014. The complete text 
of the Compact has been posted at http://www.mcc.gov/documents/agreements/compact-112906-elsalvador.pdf.

    Dated: October 14, 2014.
Thomas G. Hohenthaner,
Acting Vice President and General Counsel, Millennium Challenge 
Corporation.

Summary of Millennium Challenge Compact With the Republic of El 
Salvador

1. Overview

    The Millennium Challenge Corporation (``MCC'') has signed a five-
year, $277 million compact with the Republic of El Salvador aimed at 
reducing poverty and accelerating economic growth (the ``Compact''). 
The Compact is intended to assist the Government of El Salvador 
(``GoES'') to strengthen the investment climate, enhance the role of 
public-private partnerships in delivering key services, and improve the 
country's productivity and competitiveness in international markets. 
Through intensive policy reforms and an integrated set of investments 
in the institutional capital, human capital, and physical capital of El 
Salvador, MCC expects that the Compact will help set the foundation for 
lasting economic growth and poverty reduction.

2. Background

    This Compact will build on GoES reforms and initiatives and is 
informed by consultations with over 200 businesses. First, the Compact 
will invest in the institutional capital of El Salvador in order to 
enhance the investment climate by streamlining the regulatory 
environment and supporting the implementation of public-private 
partnerships. Second, the Compact will support policy reforms and 
invest in human capital to improve education quality and better match 
workforce skills with the demands of the labor market. Third, the 
Compact will invest in physical capital to reduce logistics and 
transportation costs by improving key road segments and border 
infrastructure in major transport corridors.
    The Compact's three projects represent a total investment of $365.2 
million, of which MCC will contribute $277 million, and the GoES will 
commit $88.2 million--a 32 percent matching contribution that is well 
above the 15 percent country contribution required for second compacts 
with lower-middle income countries.

3. Program Overview and Budget

    Below is a summary describing the components of the Compact. The 
budget and expected impacts are preliminary based on due diligence and 
project appraisal.

                                             Compact Budget Overview
----------------------------------------------------------------------------------------------------------------
                                                                                                    Portion of
                     Project                       MCC  Funding    GoES  Funding       Total          budget
                                                                                    investment       (percent)
----------------------------------------------------------------------------------------------------------------
                                                                  Millions of US$
----------------------------------------------------------------------------------------------------------------
Investment Climate Project......................            42.4            50.0            92.4            25.3
Human Capital Project...........................           100.7            15.0           115.7            31.7
Logistical Infrastructure Project...............           109.6            15.7           125.3            34.3
Monitoring and Evaluation.......................             4.3  ..............             4.3             1.2
Program Administration..........................            20.0             7.5            27.5             7.5
                                                 ---------------------------------------------------------------
    Total.......................................          $277.0           $88.2          $365.2             100
----------------------------------------------------------------------------------------------------------------

4. Summary of Projects and Activities

Investment Climate Project
    The constraints to economic growth analysis and consultations with 
investors identified excessive ``red tape'' and discretionary 
application of rules as negatively affecting the investment climate in 
El Salvador. Firms also identified the need for key public 
infrastructure to increase productivity, but tight fiscal constraints 
and weak institutional capacity limit the ability of the GoES to 
provide such infrastructure. The Investment Climate Project seeks to 
address these deficiencies in El Salvador's investment climate by 
improving the regulatory environment and the GoES's capacity to provide 
key public services in partnership with the private sector through the 
following two activities:
     The Regulatory Improvement Activity will prioritize and 
promote investment climate reforms with the goal of creating a more 
efficient and profitable business environment. MCC will support the 
development of an institutional framework and system, including an 
independent institution

[[Page 62470]]

focused on continuous regulatory improvement and the prioritization and 
implementation of a select set of reforms. The reforms will focus on 
areas critical to El Salvador's competitiveness in international 
markets and may include trade facilitation, border crossing and customs 
procedures, environmental permitting, and harmonization of municipal 
and national regulations. The regulatory improvement institution will 
also consider the extent to which regulations can be improved to reduce 
the potential for corruption. In designing and implementing reforms, 
the institution will ensure that the proposed reforms are consistent 
with the GoES's obligations under international trade and investment 
agreements, including the Dominican Republic-Central America Free Trade 
Agreement. As part of the activity, the GoES will commit to review, 
simplify and potentially eliminate regulations early in the Compact 
implementation process. Such concrete demonstrations of high level 
commitment to the reform process will be necessary to achieve a 
dramatic change in the perceptions of the business climate in El 
Salvador.
     The Partnership Development Activity seeks to enable the 
GoES to partner with private enterprise in innovative ways to provide 
critical public services in the face of tight fiscal constraints. The 
GoES has recently passed several laws to facilitate private investment 
and trade. Most notably, the GoES legislature unanimously passed a law 
in May 2013 and subsequent reforms in May 2014 to facilitate public-
private partnerships (``PPPs'') in the provision of key public 
services. MCC will invest in capacity building to properly develop, 
implement, and monitor such partnerships under this law. MCC will make 
available funding for transaction advisory services to develop and 
tender PPPs for two key infrastructure projects. Projects currently 
under review are the expansion of the El Salvador International Airport 
and a wind farm. MCC and the GoES are also sponsoring the El Salvador 
Investment Challenge (``ESIC''), a program to more efficiently and 
transparently allocate limited GoES resources to public goods needed to 
support private investment in the international trade of goods and 
services. The ESIC generated 74 investment project proposals in its 
initial call for proposals, of which 13 are being evaluated for the 
next phase of development. The GoES plans to institutionalize the ESIC 
as an instrument for attracting private investment and will contribute 
up to $50 million to the ESIC during the term of the Compact.
    The estimated economic rate of return (``ERR'') for the Investment 
Climate Project is 18.56 percent, using a weighted estimate of the 
calculated ERRs for each activity.
Human Capital Project
    The quality of education in El Salvador is below what the country 
requires to be competitive in world markets. The Human Capital Project 
is designed to improve the quality of education and to better match the 
supply of skills of students coming out of secondary school with the 
demand of a labor market oriented towards international trade. The 
project consists of the following two activities:
     The Education Quality Activity supports complementary 
interventions to provide Salvadoran students the benefits of 
competency-based education, increased classroom time, teachers trained 
in requisite subject-matters and pedagogical skills, and an 
institutional and physical environment conducive to learning. MCC's 
investment will strengthen the national education system by reforming 
the laws, policies, and operations that govern continuous professional 
development for teachers, student assessment, and information systems. 
The activity will strengthen and expand the implementation of the full-
time inclusive school model, which increases classroom time from 25 to 
40 hours per week, in an estimated 400 schools grouped in 45-55 
clusters, focusing resources on grades 7-12. The curriculum improvement 
component will focus on English, mathematics, science and information 
technology, and other 21st century skills.
     The Technical, Vocational Education and Training 
(``TVET'') System Reform Activity seeks to harmonize the skills 
supplied by private and public TVET providers with the skills demanded 
by the labor market. The activity will strengthen the national TVET 
governance system by supporting legal, policy, and operational reforms 
within the system. MCC will support the establishment of a public 
entity governed by a board comprised of an equal number of public and 
private sector representatives to provide the legal and institutional 
framework for an integrated TVET system. The activity will also fund 
TVET curricula development with participation from the private sector, 
career counseling, and job-matching services. It will also fund the 
establishment of a framework and standards for accreditation of TVET 
training organizations and certification of teachers and students. The 
activity will also strengthen the capacity of the TVET system for 
identifying labor market trends that will inform the strategic 
direction of the TVET system, including the establishment of a 
monitoring and evaluation (``M&E'') framework and a labor market 
observatory.
    The estimated ERR for the Human Capital Project is 11.35 percent.
Logistical Infrastructure Project
    The constraints analysis identified transportation and logistics as 
main factors contributing to the productivity and competitiveness of 
Salvadoran exports. Consultations with businesses during Compact 
development also highlighted certain transportation and logistics 
deficiencies, including the need to expand and rehabilitate key road 
segments in the coastal zone of El Salvador. The Logistical 
Infrastructure Project is comprised of two activities designed to 
reduce logistical and transportation costs and relieve bottlenecks at 
critical sections along the logistical corridor that connects the main 
border crossing with Honduras at El Amatillo, the Ports of La Union and 
Acajutla, and the international airport:
     The Coastal Highway Expansion Activity seeks to relieve 
congestion at the most transited segment (27 kilometers) of El 
Salvador's coastal highway by expanding this road from two to four 
lanes. The coastal highway is one of the two most important logistical 
corridors in the country and connects the country's major logistical 
nodes along the Southern coastal zone of the country, including its two 
sea ports (La Union and Acajutla) and the international airport.
     The Border Crossing Infrastructure Activity seeks to 
relieve the freight and passenger traffic congestion at the border 
crossing into Honduras at El Amatillo by improving a 5.7 kilometer road 
leading to the border and modernizing the border-crossing facilities on 
the Salvadoran side. MCC will invest in the construction of control 
stations at the border, including buildings, internal access and 
connecting roads, parking areas, water and sanitation, and other 
infrastructure components that may be necessary for the effective 
functioning of these stations.
    The estimated ERR for the Logistical Infrastructure Project is 
20.31 percent, using a weighted estimate of the calculated ERRs for 
each activity.

[[Page 62471]]

5. Program Logic, Expected Results, and Beneficiaries
    In order for El Salvador to be competitive and raise productivity 
in internationally-traded goods and services, the factors of production 
in El Salvador must be competitive on world markets. Those factors 
include human capital, physical capital, and often logistics/
transportation. The institutional environment can also affect 
productivity. As a result, the Compact takes a multi-pronged approach 
to enhance El Salvador's competitiveness in these factors of 
productivity.
    By streamlining the business environment, improving the quality of 
education, and reducing transportation and logistics costs, MCC's 
investments are intended to increase the productivity of current firms 
involved in the trade of international goods and services, which is 
expected to increase current production (and subsequently, employment). 
Firms are then expected to invest new revenues in more productive 
technology to realize greater returns on future production. Higher 
employment and output are expected over time through this self-
reinforcing feedback loop which is enabled by greater productivity in 
traded goods and services.
    The expected beneficiaries of the Regulatory Improvement Activity 
are the firms operating in El Salvador (currently more than 25,000) 
that will experience cost savings as a result of regulatory reforms. 
The potential expansion of the El Salvador International Airport under 
the Partnership Development Activity is expected to decrease delays and 
travel costs for travelers, while the wind farm project would increase 
the GoES's ability to attract investment for renewable energy. The 
beneficiaries of the ESIC are expected to be those firms whose 
proposals are selected for grant funding, workers who realize net 
income gains associated with employment as a result of the projects, 
and third parties who benefit from the public investment.
    MCC expects the Human Capital Project to directly benefit students 
in grades 7-12 in general and technical education, who realize higher 
incomes as a result of more years of education. In particular, the 
project is expected to contribute to preventing or postponing the 
dropout of approximately 176,000 students. Direct beneficiaries of the 
TVET System Reform Activity are expected to be TVET students who 
receive higher incomes as a result of receiving skills that are better 
matched to labor market needs. Additional beneficiaries of the project 
include students who do not attend a full-time inclusive school but 
receive increased incomes as a result of improved quality of education 
that result from the implementation of reforms at the national level. 
Communities may also experience reductions in crime as a result of the 
full-time inclusive school model, due to increased permanence in school 
and lowered social vulnerability of students.
    The beneficiaries for the Logistical Infrastructure Project are the 
estimated 171,159 individuals living within five kilometers of either 
side of the project sites. Because of the nature of the activities as 
key logistical thoroughfares, benefits in the form of reduced vehicle 
operating costs and travel time are expected to accrue to individuals 
and firms that travel along those corridors.
6. 2006 El Salvador Compact Update and Sustainability Information
    In November 2006, the Millennium Challenge Corporation signed a 
five-year, $460.94 million compact (the ``2006 Compact'') with the GoES 
to improve the economic opportunities of Salvadorans through strategic 
investments in agricultural production, rural business development, 
education, and transportation infrastructure. The 2006 Compact 
consisted of the following three projects:
    1. The Connectivity Project, to reduce travel cost and time within 
the Northern Zone,
    2. The Human Development Project, to increase the human and 
physical capital of residents of the Northern Zone and further 
employment and business opportunities, and
    3. The Productive Development Project, to increase production and 
employment through technical assistance, credit guarantees, and capital 
investments.
    The 2006 Compact entered into force on September 20, 2007 and 
closed on September 20, 2012.
    Key Achievements of the Compact are as follows:
     Connectivity Project: A total of 223.32 kilometers of 
road, including three large bridges, and 20 smaller bridges were 
constructed in northern El Salvador to help improve connectivity for 
farmers and local producers with the rest of the country. This east-
west road in the north stretches close to the borders with Guatemala to 
the west and Honduras to the east, and the improvements have reduced 
travel time across the Northern Zone from 12 hours to 6.5 hours.
     Human Development Project:
    Electrification: An estimated 35,412 households now have 
electricity in their homes, thanks to the installation of new power 
lines and solar power systems, helping to increase the percentage of 
households with electricity connections in the Northern Zone from 78 
percent in 2007 to 90 percent in 2011.
    Water and Sanitation: MCC funded about 272 kilometers of water 
pipes as part of the 2006 Compact's investment in water and basic 
sanitation that helped connect 7,624 households to potable water.
    Education: MCC funded the construction of a new technical community 
college, improvements to a teacher training center, and the expansion 
and rehabilitation of 20 high schools. The rehabilitation of the high 
schools alone is expected to benefit more than 9,700 students every 
year.
     Productive Development Project: MCC funding assisted an 
estimated 17,500 producers through the provision of training, seeds, 
equipment, and technical assistance. The project provided 30 loans to 
small and medium-sized businesses in the Northern Zone to develop new 
or expand investments in the agriculture, tourism and handicrafts value 
chains. These loans totaled $5.7 million, of which approximately 20 
percent went to women-owned businesses.
    Sustainability:
    Although no contribution was required from El Salvador during the 
implementation of the 2006 Compact, the GoES contributed substantially 
in parallel to the Compact to enhance the success of the program.
    The Connectivity Project: In the final year of compact 
implementation (2012), the GoES also carried out two road maintenance 
reforms, increasing annual road maintenance funding by about $26 
million (~37% increase). At the end of the five years, the GoES 
allocated an additional $13 million to complete two remaining segments 
of the Northern Transnational Highway. During the four-month closure 
period, all activities under the 2006 Compact were successfully 
completed.
    The Human Development Project's activities were extensions of 
existing GoES programs, built on the National Plan for Education 2021 
and designed to strengthen and install permanent capacities in key 
Salvadoran ministries and institutions. In addition, the Ministry of 
Education agreed to fund infrastructure and equipment maintenance and 
continued an agreement with the Gloria de Kriete Foundation to fund 
scholarship for secondary education through 2014.

[[Page 62472]]

    The Productive Development Project was designed to transition 
producers to higher-profit activities, generate new investment, expand 
markets and sales, and create new jobs in ways that stimulate 
sustainable economic growth and poverty reduction. Actions accomplished 
to ensure sustainability of investments made under the Productive 
Development Project included the establishment of contracts between 
beneficiaries and supported cooperatives and major retailers for the 
purchase of horticulture and dairy products. The Ministry of 
Agriculture also incorporated the project's beneficiaries into its 
national Family Agriculture Plan, its signature agriculture extension 
service aimed at improving the profitability of individual and small 
and medium-sized producers.
    Environmental and Social Sustainability:
    As part of an effort to ensure environmental and social 
sustainability, all Projects included consultations with the public 
regarding various aspects of their implementation. The design of the 
Projects, including their major activities, was included in a strategic 
environmental assessment that was completed prior to implementation. 
The sustainability of the projects was also enhanced by the 
institutional capacity building and training in environmental 
management acquired through the close cooperation among the 
environmental units of the implementing agencies, the Millennium 
Challenge Account (MCA), and MCC. The Salvadoran Ministry of 
Environment (MARN) received Compact funding support to offset the 
additional regulatory costs associated with the Projects. Over the 
course of the Compact, collaboration improved between MARN and the 
environment units of the implementing agencies.
    The GoES and private sector and civil society organizations have 
consistently worked to ensure the sustainability of the 2006 Compact 
and we expect them to continue to support these investments going 
forward.

[FR Doc. 2014-24773 Filed 10-16-14; 8:45 am]
BILLING CODE 9211-03-P