Interactive: Trends in pipeline opportunities with MCC

Update: The Millennium Challenge Corporation has released its Partner Country Business Forecast for Q2 2019-Q1 2020. Keep reading to explore the interactive data. The Millennium Challenge Corporation’s two pipeline documents — the midyear update to its MCC Business Forecast and the quarterly update to its MCC Partner Country Business Forecast — are a pipeline of opportunities for contractors and partners as well as local entities in partner countries. In this article, we’ll explain what you need to know about the documents while analyzing the context at MCC. What are these documents? The MCC Business Forecast is analogous to that of the U.S. Agency for International Development — it is a pipeline of “anticipated contract actions,” including procurement for goods, services, and works, as well as employment and consulting contracts. It is not exhaustive, and contract actions are only required to be reported if their expected cost exceeds $150,000, although actions below that threshold are sometimes included. Data from the Business Forecast is released twice a year — first in November/December with data for the following year, and then a midyear update in June/July. Indicative budget figures are given in standard ranges of $0 to $150,000; $150,000 to $700,000; $700,000 to $5 million; $5 million to $10 million; and $10 million to $20 million or more. Unlike some other donors’ pipeline documents, it does not include information on the sector that each action falls into. The Business Forecast contains only actions whose procurement will be administered by MCC. The Partner Country Business Forecast — also known as PCBF — on the other hand, is a result of MCC’s unique approach to development aid. MCC partner countries lead the implementation of their own MCC compacts or threshold agreements through locally-empowered entities, called Millennium Challenge Accounts, or MCAs. PCBF details the pipeline of contract actions whose procurement will be administered by MCA, not MCC itself. PCBF differs from the Business Forecast in several ways: PCBF actions are required to be disclosed if they have an anticipated cost of at least $200,000, rather than the slightly lower threshold for the Business Forecast, but PCBF includes no indicative budget information beyond this. It does, however, attribute a generic “sector” of activity to each action, such as agriculture, or water and sanitation. Finally, updates to PCBF are released quarterly. Trends in pipelines Devex has been tracking the MCC’s Business Forecast for the past four years. Over that time it has consistently grown in dollar terms. At the start of 2016, the aggregate budget range of all the forecast’s contract actions was $53 million to $309.2 million. The same range for the 2018 midyear update is $101.7 million to $514.2 million. Generally, the forecast increases in dollar terms between its original release and its midyear update. This is due mostly to new additions to the pipeline, combined with some delays in awards that were supposed to be made in Q1 or Q2 of that year, and occasionally upward revisions in contract action budgets. But even if we account for these seasonal oscillations by only comparing start-of-year budgets, there is still a consistent upward trend in the size of the Business Forecast budget. Much of this growth has been driven by increased pipelines in West African compact countries. West Africa — and Africa more broadly — appears to be a big focus for MCC going forward. A few months before the release of the 2018 Business Forecast, an energy-focused compact worth $375 million was signed with Benin, followed by a $525 million compact with Côte d’Ivoire. The pipelines of both countries in the Business Forecast totaled $90 million, mostly in Côte d’Ivoire. The largest MCC contract action in the 2018 pipeline was linked to its work on transportation infrastructure in Abidjan, with a budget of $10 to $20 million. Both Côte d’Ivoire and Benin also figured prominently in the 2018 PCBF, with 23 contract actions awarded in the following three quarters in the sectors of WASH, energy, and education. After the release of the 2018 Business Forecast in November 2017, a great deal of Africa-related milestones were passed at MCC. The U.S. government signed the AGOA and MCA Modernization Act, paving the way for MCC to begin making regional compacts. MCC also signed a memorandum of understanding with the African Development Bank. The two now work together on the Benin Power Compact, signed between MCC and the country in 2017, on regional integration. In 2018, MCC signed a $437 million compact in Niger, and was also developing compacts in Senegal and Burkina Faso, in addition to a threshold agreement in The Gambia. It is possible that a first regional compact could link operations in these and other West African compact countries. At that time, there were 18 pipeline contract actions in the Business Forecast to be awarded in Senegal, Burkina Faso, and Niger — but none for The Gambia — worth between $7.6 million and $51.3 million in total. An additional 16 actions from PCBF were also to be awarded for Senegal and Niger, mostly in the areas of agriculture and program administration. Not all the opportunities were in Africa, however. There were also slight increases in the pipeline for contract actions in the Middle East and Asia Pacific compact countries, driven by ongoing compacts in Mongolia and Morocco; evaluation of the recently-closed compact in Indonesia; funding to prepare the $500 million compact with Nepal signed in 2017; as well as three agreements under preparation, which include compacts with Tunisia and Sri Lanka, and a threshold agreement with Timor-Leste. There mid-year 2018 procurement offered 33 Business Forecast contract actions spread across seven countries, which were awarded in the following two quarters, worth between $12 million and $79 million in total. View the interactive tableau of MCC and MCA pipelines that includes Partner Country Business Forecast for Q2 2019-Q1 2020. Explore the data to understand what opportunities are available by geographic region and sector.