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Sarah Rose is a policy fellow at the Center for Global Development. Her work, as part of the Center’s US Development Policy Initiative, focuses on US government aid effectiveness. Areas of research and analysis include the policies and operation of the Millennium Challenge Corporation (MCC), the use of evaluation and evidence to inform programming and policy, the implementation of country ownership principles, and the process of transitioning middle income countries from grant assistance to other development instruments.
Previously, Rose worked for the United States Agency for International Development (USAID) in Mozambique as a specialist in strategic information and monitoring and evaluation. She also worked at MCC, focusing on the agency’s evidence-based country selection process. She holds a Masters degree in public policy and a BS in foreign service, both from Georgetown University.
One of the biggest questions donors grapple with is how to balance implementing specific projects with building local capacity to execute similar programming in the future. Indeed, this question is central to the conversation—now active at USAID—about how donors can “work themselves out of a job.” One good example of how this can look comes from the Millennium Challenge Corporation’s (MCC) 2005-2010 partnership with Honduras. In this story, a key part of MCC’s legacy is not about what the agency funded but how it funded it.
This week, MCC edged one step closer to securing new authorities that would better position the agency to undertake regional programming. Similar provisions were included in fully five bills in the 114th Congress, but none made it over the finish line. Hopefully 2018 will be the year.
In recent months, USAID has been working diligently to craft its approach to “strategic transitions,” framing the principles it will follow, the benchmarks that will help inform transition decisions, and the programs and tools it can bring to bear. This Thursday, in a public discussion with the agency’s Advisory Committee on Voluntary Foreign Aid (ACVFA), USAID will outline its initial thinking about strategic transitions. Our recent paper, Working Itself Out of a Job: USAID and Smart Strategic Transitions, offers some advice to the agency as it charts the course ahead. Here are the main takeaways.
Every December, MCC’s board of directors meets to select the set of countries eligible for MCC’s compact or threshold programs. And each year, before the board meeting, CGD’s US Development Policy Initiative publishes a discussion of the overarching issues expected to impact the decisions alongside its predictions for which countries will be selected. Here’s what to watch for at the upcoming MCC board meeting on December 19.
Next month, the Millennium Challenge Corporation’s board of directors will meet to select the set of countries that will be eligible for the agency’s large-scale grant programs. One of the decisions on the table will be whether to continue the partnership with the Philippines. Over the last year and a half, questions have emerged about whether the Philippines continues to meet MCC’s good governance criteria. In one month, MCC and its board will have to answer those lingering questions.
Domestic revenue mobilization (DRM) seems set to be a priority area for the US Agency for International Development (USAID) under Administrator Mark Green. The challenge has been in tracking US (and other donors’) support for DRM activities. While the data only covers projects in 2015 so far, it contributes to a better understanding of what US aid agencies are doing in the DRM space and where they are working. If the United States is looking to step up assistance in this area, it will be instructive to understand the landscape of current efforts.
One of the key pillars of MCC’s model is that country ownership matters for results. In broad terms, the idea of country ownership is that donors’ engagement with developing countries should reflect the understanding that partner country governments, in consultation with key stakeholders, should lead the development and implementation of their own national strategies and that foreign aid should largely serve to strengthen recipients’ capacity to exercise this role.
Happily, in the last 25 years, the proportion of people living on less than $1.25 a day has dropped by two-thirds. Most of this success is due to major global forces such as trade and cross-border labor mobility. And much of the credit goes to the governments and citizens of developing countries themselves for pursuing the policies that have enabled donor, private sector, and (increasingly) their own resources to translate into development outcomes. But development assistance—including US aid—has made important contributions.
Since its establishment more than 54 years ago, the United States Agency for International Development (USAID) has expanded into an $18-billion-a-year agency, operating in over 145 countries and in nearly every development sector. But USAID is often constrained in its ability to adapt to emerging development challenges due to differing political priorities among key stakeholders and resource constraints. This memo is the result of a roundtable discussion in July 2016 on how the next US administration, in close concert with Congress, can build upon and maximize the development impact of USAID.
The Millennium Challenge Corporation’s (MCC) board of directors is scheduled to meet on December 10. As usual, they will use this end-of-year meeting to vote on which countries will be eligible for MCC assistance for FY2015.
Attention presidential transition teams: the Rethinking US Development Policy team at the Center for Global Development strongly urges you to include these three big ideas in your first year budget submission to Congress and pursue these three smart reforms during your first year.
Though the spirit of the proposal—a fundamental desire to make US foreign aid more effective—deserves widespread support, any plan to supersize MCC by drastically cutting or eliminating USAID is impractical and counterproductive for two overarching reasons. First, the characteristics that make MCC so appealing also limit its scalability. Making the agency significantly larger would compromise much of what makes it work as well as it does. Second, scaling back or phasing out USAID would eliminate several important functions of US foreign assistance that MCC is not designed nor well-suited to address.