A woman with a miniature Tanzanian flag. The Millennium Challenge Corp. suspended discussions of a second aid compact with the African country. Photo by: DEMOSH / CC BY

Tanzania’s government must outline how it will address concerns about democratic inclusivity if it wants to reopen a partnership with the Millennium Challenge Corp., MCC officials told Devex, after the U.S. development agency decided on Monday to suspend a $472 million compact with the country.

At its quarterly meeting on March 28, MCC’s board of directors decided to cease “all activities related to the development of a second compact” for assistance. The board pointed to elections in semi-autonomous Zanzibar on March 20 that were “neither inclusive nor representative,” and to concerns the country’s Cybercrimes Act is being “used to limit freedom of expression and association,” according to a statement.

A previous vote on the compact in December had been deferred over what the board said were “governance concerns.”

“I think we’ve been very clear about what the situation was that led to the suspension,” said Beth Tritter, MCC’s vice president for policy and evaluation. If Tanzania’s government wants to re-enter into partnership with MCC, the country’s government must take the lean, with a plan to address those specific concerns, Tritter added.

“We don’t provide checklists at MCC. We leave it to governments to demonstrate how they’re going to show their commitments to these principles, and so we’ll have to look at what we get from the government of Tanzania,” she said.

Tanzania is a major U.S. development partner, with nearly $600 million in assistance from the State Department and U.S. Agency for International Development planned for 2016. Most flagship U.S. development initiatives operate in Tanzania, including Power Africa, President Barack Obama’s effort to double access to energy in sub-Saharan Africa.

Tanzania had also been a longtime partner of MCC, signing what was at the time the largest compact in the corporation’s history in February 2008 — nearly $700 million aimed at increasing access to electricity.

The new MCC compact that had been under consideration was also expected to support Tanzanian President John Magufuli’s plan to increase rural electrification in a country that has struggled with consistent access to power and seen economic growth suffer as a result.

MCC’s scorecard, which evaluates countries’ fitness for partnership according to indicators like “control of corruption,” has been trending in the wrong direction for Tanzania, and in December the agency’s board deferred its vote on Tanzania’s eligibility for a second compact. U.S. Ambassador to Tanzania Mark Childress at that time pointed to politically motivated arrests carried out under the auspices of the Cybercrimes Act as a reason for the deferral.

MCC’s decision to suspend the partnership is consistent with similar decisions it has made in the past, including with other high-profile partners like Honduras and Armenia, said Sarah Rose, senior policy analyst at the Center for Global Development and former senior development policy officer at MCC.

The elections in Zanzibar could have provided MCC with a “pivotal event,” on which to base their suspension decision, Rose said. With slower deteriorating governance issues — like worsening corruption or challenges to civil liberties — it can be harder to judge exactly when a red line has been crossed, she added.

Read more international development news online, and subscribe to The Development Newswire to receive the latest from the world’s leading donors and decision-makers — emailed to you FREE every business day.

About the author

  • Michael Igoe

    Michael Igoe is a Senior Reporter with Devex, based in Washington, D.C. He covers U.S. foreign aid, global health, climate change, and development finance. Prior to joining Devex, Michael researched water management and climate change adaptation in post-Soviet Central Asia, where he also wrote for EurasiaNet. Michael earned his bachelor's degree from Bowdoin College, where he majored in Russian, and his master’s degree from the University of Montana, where he studied international conservation and development.