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US Development Policy

CGD experts track US development policy and offer ideas and analysis to improve its impact on developing countries. Also check out our Views from the Center blog and Global Health Policy blog.

Rethinking US Development Policy Blog


Awkward Timing for MCC Chief's Departure

Financial Times' Andrew Balls reported last night that Paul Applegarth's surprise resignation resulted from failing confidence within the Bush administration that the flagship aid program was fulfilling expectations. Ball wrote:

The timing of the resignation was awkward for the administration, occurring just before the Group of Eight summit in Scotland next month. At the summit, President George W. Bush will promote the Millennium Challenge Account, overseen by the MCC, as the US's preferred way of raising aid flows to African countries.

Who is Watching the MCC?

Evidently not the Washington press. The New York Times broke the story of Paul Applegarth's resignation on Thursday, June 16, the day after the MCC CEO told his staff he planned to resign. On Friday the NYT's Celia Dugger ran some thoughtful analysis.
Reuters and Associated Press both ran stories, which were picked up in places as distant as South Africa and London, where the Guardian ran an AP story that linked cuts in funding to Applegarth's resignation.

What's Next for the MCC?

The resignation of Paul Applegarth as the CEO of the MCC, followed by the news that Congress has cut back the funds that President Bush requested for the fledgling aid agency has both critics and supporters of MCC wondering whether it can live up to its bold vision. Although the MCC made a reasonable amount of progress in its first year, whoever becomes the new head will face major challenges. Read Challenges for the New Leader of the Millennium Challenge Corp., by Steve Radelet and myself.

MCC CEO Paul Applegarth to Step Down

The New York Times reports this morning that Paul Applegarth, the Chief Executive Officer of the Millennium Challenge Corporation will step down at a date yet determined. The MCC will provide more details soon.
The New York Times wrote:

Two days after a group of African leaders complained that the Bush administration's signature program to aid poor nations had proved slow, the head of the program told his staff on Wednesday that he would resign.

MCC Board Approves Cape Verde and Nicaragua Compacts, Signs Honduras Compact

The MCC today approved two new five-year compacts, and held a signing ceremony for the recently approved $215 million compact with Honduras.
Speaking at the ceremony, Secretary of State Condoleezza Rice said that the compact was the reflection of the commitment of the people of Honduras to change. "Honduras compact embodies the new approach to development embraced by nations at the Monterrey Summit in 2002," she said.

Honduras Closer to MCA Vision

MCA watchers have been concerned about a seeming lack of civil society participation in proposal design in MCA-eligible countries. That participation is one of MCA's main objectives. Some observers claim that in some countries civil society contributes only at the periphery of the debate while the business community leads the process. Honduras may be different.

MCC Board Approves Honduras Proposal

A month after the MCC signed its first compact with Madagascar, the Board of Directors has approved a compact with Honduras. The five-year $215 million compact approved on May 20 aims to boost rural development and revamp a weak transportation infrastructure.

Governance Matters, or Does It?

World Bank governance experts Daniel Kaufmann and Aart Kraay presented findings from their latest research, "Governance Matters IV: Governance Indicators for 1996-2004" at a CGD event on May 18. The study, written with another economist, Massimo Mastruzzi, provides updated information on six key dimensions of governance for 209 countries in 2004. This fourth version of the research draws from the most comprehensive set of governance indicators yet developed.

MCC Board Meets on Honduras Compact

The Board of Directors of the Millennium Challenge Corporation will meet Friday, May 20, from 10:30 am to 12:00 pm at the State Department. Most of the meeting will be devoted to a review of Honduras' MCA compact proposal. The first 15 to 20 minutes will be open to the public. Board Chair Condoleezza Rice and CEO Paul Applegarth will speak during the open session.
Check the notice of meeting for more details

MCC's First Year of Operations - GAO Report Highlights

For two days, April 26 and 27, the United States Congress held hearings on the Millennium Challenge Corporation, for the Senate Foreign Relations Committee and the House International Relations Committee, respectively. The Congress wanted a full report on the MCC's first year of operations.
In his introductory remarks during the HIRC hearing, Chairman Henry Hyde (IL), expressed some growing concern about the MCC's progress: