MCC Proposes Compact Extension in 'Exceptional Circumstances'

The Millennium Challenge Corp. is urging the U.S. Congress to allow the agency in “exceptional circumstances” to extend a compact by up to two years.

In his prepared testimony for a March 15 hearing of the House Appropriations subcommittee on State and foreign operations, MCC CEO Daniel Yohannes said: “Allowing MCC, in exceptional circumstances, to extend the duration of our five-year compact period for up to two additional years would allow MCC and our partner countries to pursue a fuller set of options for managing challenges and achieving compact objectives.”

Yohannes also reiterated his proposal to permit MCC to enter into concurrent compacts. Concurrent compacts refer to separate contracts that the agency and a country enter into based on the specific timing requirements of individual projects rather than as part of a package with a single timeline.

Also during his testimony, Yohannes said the $1.125 billion request by U.S. President Barack Obama for the agency will enable it to sign compacts with Georgia, Ghana and Indonesia. As reported by Devex in January, MCC deemed Georgia and Ghana as eligible for second compacts.

>> MCC Reveals 2011 Aid-Eligible Countries, OKs Malawi Compact

Yohannes estimated that the second Georgia compact will be in the range of $100million to $150 million, while that for Ghana would amount to as much as $400 million. MCC expects the compact with Indonesia to be in the amount of $700 million to $770 million.

Along with other federal agencies, MCC faces the challenge of securing congressional approval for its budget. Many in Congress, mainly Republicans, seek to cut government spending, including the international affairs budget.

Rep. Ileana Ros-Lehtinen (R-Fla.) is among these lawmakers. She heads the House Foreign Affairs Committee, where Yohannes will appear today (March 16) along with U.S. Agency for International Development Administrator Rajiv Shah. The joint appearance in Congress of these agencies is a first.

>> Yohannes and Shah Head to the Hill: Duet or Competition?

Read more about U.S. development aid.

About the author

  • Eliza Villarino

    Eliza Villarino currently manages one of today’s leading publications on humanitarian aid, global health and international development, the weekly GDB. At Devex, she has helped grow a global newsroom, with talented journalists from major development hubs such as Washington, D.C, London and Brussels. She regularly writes about innovations in global development.