Report on the Selection of Eligible Countries for Fiscal Year 2020, 69393-69395 [2019-27284]

Agencies

• Millennium Challenge Corporation

[Federal Register Volume 84, Number 243 (Wednesday, December 18, 2019)]
[Notices]
[Pages 69393-69395]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-27284]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 19-10]


Report on the Selection of Eligible Countries for Fiscal Year 
2020

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: This report is provided in accordance with section 608(d)(2) 
of the Millennium Challenge Act of 2003, as amended (the ``Act''), 22 
U.S.C. 7707(d)(2).

    Dated: December 13, 2019.
Christopher J. Dunn,
Acting VP/General Counsel and Corporate Secretary.

Report on the Selection of Eligible Countries for Fiscal Year 2020

Summary

    This report is provided in accordance with section 608(d)(1) of the 
Millennium Challenge Act of 2003, as amended (the Act) (22 U.S.C. 
7707(d)(1)).
    The Act authorizes the provision of assistance under section 605 of 
the Act (22 U.S.C. 7704) to countries that enter into compacts with the 
United States to support policies and programs that advance the 
progress of such countries in achieving lasting economic growth and 
poverty reduction, and are in furtherance of the Act. The Act requires 
the Millennium Challenge Corporation (MCC) to determine the countries 
that will be eligible to receive assistance for the fiscal year, based 
on their

[[Page 69394]]

demonstrated commitment to just and democratic governance, economic 
freedom, and investing in their people, as well as on the opportunity 
to reduce poverty and generate economic growth in the country. The Act 
also requires the submission of reports to appropriate congressional 
committees and the publication of notices in the Federal Register that 
identify, among other things:
    1. The countries that are ``candidate countries'' for assistance 
for fiscal year (FY) 2020 based on their per-capita income levels and 
their eligibility to receive assistance under U.S. law, and countries 
that would be candidate countries but for specified legal prohibitions 
on assistance (section 608(a) of the Act (22 U.S.C. 7707(a)));
    2. The criteria and methodology that the Board of Directors of MCC 
(the Board) will use to measure and evaluate the policy performance of 
the ``candidate countries'' consistent with the requirements of section 
607 of the Act in order to determine ``eligible countries'' from among 
the ``candidate countries'' (section 608(b) of the Act (22 U.S.C. 
7707(b))); and
    3. The list of countries determined by the Board to be ``eligible 
countries'' for FY 2020, with justification for eligibility 
determination and selection for compact negotiation, including with 
which of the eligible countries the Board will seek to enter into 
compacts (section 608(d) of the Act (22 U.S.C. 7707(d))).
    This is the third of the above-described reports by MCC for FY 
2020. It identifies countries determined by the Board to be eligible 
under section 607 of the Act (22 U.S.C. 7706) for FY 2020 with which 
the MCC will seek to enter into compacts under section 609 of the Act 
(22 U.S.C. 7708), as well as the justification for such decisions. The 
report also identifies countries selected by the Board to receive 
assistance under MCC's threshold program pursuant to section 616 of the 
Act (22 U.S.C. 7715).

Eligible Countries

    The Board met on December 9, 2019, to select those eligible 
countries with which the United States, through MCC, will seek to enter 
into a Millennium Challenge Compact pursuant to section 607 of the Act 
(22 U.S.C. 7706). The Board selected the following eligible country for 
such assistance for FY 2020: Mozambique. The Board also selected the 
following previously-selected countries for compact assistance for FY 
2020: Benin, Burkina Faso, C[ocirc]te d'Ivoire, Indonesia, Lesotho, 
Malawi, Niger, Timor-Leste, and Tunisia.
Criteria
    In accordance with the Act and with the ``Report on the Criteria 
and Methodology for Determining the Eligibility of Candidate Countries 
for Millennium Challenge Account Assistance in Fiscal Year 2020'' 
formally submitted to Congress on September 18, 2019, selection was 
based primarily on a country's overall performance in three broad 
policy categories: Ruling Justly, Encouraging Economic Freedom, and 
Investing in People. The Board relied, to the fullest extent possible, 
upon transparent and independent indicators to assess countries' policy 
performance and demonstrated commitment in these three broad policy 
areas. The Board compared countries' performance on the indicators 
relative to their income-level peers, evaluating them in comparison to 
either the group of countries with a GNI per capita equal to or less 
than $1,925, or the group with a GNI per capita between $1,925 and 
$3,995.
    The criteria and methodology used to assess countries on the annual 
scorecards are outlined in the ``Report on the Criteria and Methodology 
for Determining the Eligibility of Candidate Countries for Millennium 
Challenge Account Assistance in Fiscal Year 2020 \1\''. Scorecards 
reflecting each country's performance on the indicators are available 
on MCC's website at www.mcc.gov/scorecards.
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    \1\ Available at https://www.mcc.gov/resources/doc/report-selection-criteria-methodology-fy20.
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    The Board also considered whether any adjustments should be made 
for data gaps, data lags, or recent events since the indicators were 
published, as well as strengths or weaknesses in particular indicators. 
Where appropriate, the Board took into account additional quantitative 
and qualitative information, such as evidence of a country's commitment 
to fighting corruption, investments in human development outcomes, or 
poverty rates. In keeping with legislative directives, the Board also 
considered the opportunity to reduce poverty and promote economic 
growth in a country, in light of the overall information available, as 
well as the availability of appropriated funds.
    The Board sees the selection decision as an annual opportunity to 
determine where MCC funds can be most effectively used to support 
poverty reduction through economic growth in relatively well-governed, 
poor countries. The Board carefully considers the appropriate nature of 
each country partnership--on a case-by-case basis--based on factors 
related to economic growth and poverty reduction, the sustainability of 
MCC's programs, and the country's ability to attract and leverage 
public and private resources in support of development.
    This was the second year the Board considered the eligibility of 
countries for concurrent compacts. In addition to the considerations 
for compact eligibility detailed above, the Board considered whether a 
country being considered for a concurrent compact is making 
considerable and demonstrable progress in implementing the terms of its 
existing Compact.
    This was the eleventh year the Board considered the eligibility of 
countries for subsequent compacts, as permitted under section 609(l) of 
the Act. MCC's engagement with partner countries is not open-ended, and 
the Board is deliberate when selecting countries for follow-on 
partnerships, particularly regarding the higher bar applicable to 
subsequent compact countries. In making these selection decisions, the 
Board considered--in addition to the criteria outlined above--the 
country's performance implementing its first compact, including the 
nature of the country's partnership with MCC, the degree to which the 
country has demonstrated a commitment and capacity to achieve program 
results, and the degree to which the country has implemented the 
compact in accordance with MCC's core policies and standards. To the 
greatest extent possible, these factors were assessed using pre-
existing monitoring and evaluation targets and regular quarterly 
reporting. This information was supplemented with direct surveys and 
consultation with MCC staff responsible for compact implementation, 
monitoring, and evaluation. MCC published a Guide to Supplemental 
Information \2\ and a Guide to the Compact Survey Summary \3\ in order 
to increase transparency about the type of supplemental information the 
Board uses to assess a country's policy performance and compact 
implementation performance. The Board also considered a country's 
commitment to further sector reform, as well as evidence of improved 
scorecard policy performance.
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    \2\ Available at https://www.mcc.gov/resources/doc/guide-to-supplemental-information-fy20.
    \3\ Available at https://www.mcc.gov/resources/doc/guide-to-the-compact-survey-summary-fy20.
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    In addition, this is the fourth year where the Board considered an 
explicit higher bar for those countries close to the upper end of the 
candidate pool, looking closely in such cases at a country's access to 
development

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financing, the nature of poverty in the country, and its policy 
performance.
Countries Newly Selected for Compact Assistance
    Using the criteria described above, one candidate country under 
section 606(a) of the Act (22 U.S.C. 7705(a) was newly selected for 
assistance under section 607 of the Act (22 U.S.C. 7706): Mozambique. 
In accordance with section 609(k) of the Act, no candidate countries 
were newly selected to explore development of a concurrent compact 
program under section 607 of the Act (22 U.S.C. 7706).
    Mozambique: Mozambique successfully completed its first MCC compact 
in September 2013 and has recently demonstrated encouraging policy 
improvement on the MCC scorecard, passing 13 of 20 indicators, with 
clear improvement on its Control of Corruption score. A new compact 
would build on the country's continued commitment to sector reform and 
MCC's strong relationship with the country developed under the first 
compact partnership. By selecting Mozambique for a compact, MCC will 
support the government's efforts to strengthen economic growth to 
reduce poverty.
Countries Selected To Continue Compact Development
    Nine of the countries selected for compact assistance for FY 2020 
were previously selected for FY 2019. Burkina Faso, Indonesia, Lesotho, 
Malawi, Timor-Leste, and Tunisia were selected to continue developing 
bilateral compacts. Benin, Burkina Faso, C[ocirc]te d'Ivoire, and Niger 
were selected to continue developing concurrent compacts for the 
purpose of regional integration. Selection of these countries for FY 
2020 was based on their continued or improved policy performance since 
their prior selection.
Countries Selected To Receive Threshold Program Assistance
    The Board selected Kenya to receive threshold program assistance.
    Kenya: Kenya offers MCC the opportunity to engage with the country 
on policy and institutional reform. Kenya is an important partner in 
East Africa, where MCC's presence is growing. Although Kenya has not 
previously passed the Control of Corruption indicator on the MCC 
scorecard, its performance rose to the 50th percentile this year (a 
country must score above the 50th percentile to pass the indicator). 
More broadly, Kenya passes 15 of 20 indicators overall on the 
scorecard, including the Democratic Rights ``hard hurdle'' indicators.
Countries Selected To Continue Developing Threshold Programs
    The Board selected Ethiopia and Solomon Islands to continue 
developing threshold programs. Ethiopia has continued on its reform 
path and saw improvements on the democratic rights ``hard hurdle'' 
indicators of political rights and civil liberties this year. Solomon 
Islands held successful elections in April 2019 and continues apace 
with program development.

Ongoing Review of Partner Countries' Policy Performance

    The Board emphasized the need for all partner countries to maintain 
or improve their policy performance. If it is determined during compact 
implementation that a country has demonstrated a significant policy 
reversal, MCC can hold it accountable by applying MCC's Suspension and 
Termination Policy.\4\
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    \4\ Available at https://www.mcc.gov/resources/doc/policy-on-suspension-and-termination.

[FR Doc. 2019-27284 Filed 12-13-19; 4:15 p.m.]
BILLING CODE 9211-03-P