Sanjay Neupane
WASHINGTON DC, DEC 18 -
Nepal has been selected as eligible for the threshold programme of the Millennium Challenge Corporation (MCC), a US foreign aid agency established to help fight against global poverty.
An MCC board meeting chaired by US Foreign Secretary Hillary Clinton on Thursday selected Nepal as an eligible recipient of MCC assistance. The MCC’s decision has paved the way for Nepal to get assistance for large infrastructure projects from the world’s largest economy. Around three dozen countries are associated with MCC that has an annual budget of $9 billion.
MCC Vice President Sheila Herrling informed Nepali Ambassador to the US Shankar Sharma about the decision. “It’s a bigachievement for Nepal,” said Sharma. “MCC is other than the usual US assistance programmes. It provides aid to poor countries for road, education, health and irrigation, among others.”
The inclusion of Nepal under MCC is seen an indicator that the progress in peace process could bring in more international assistance. An MCC press statement also states, “Nepal performs well on the policy indicators on MCC’s scorecard, and with recent landmark agreements on the Comprehensive Peace Accord in place, MCC looks forward to establishing a threshold partnership with Nepal.”
Qualifying for the MCC assistance is a competitive process in which a country’s performance on 17 various policy indicators is carefully assessed. Following the assessment, the MCC board selects eligible countries for the assistance after the US Congress’ approval. The MCC board comprises of high-level US officials, including Treasury Secretary Timothy F Geithner, US Trade Representative Ron Krik, USAID Administrator Rajiv Shah and US Global Leadership Coalition Senior Director Mark Green.
Under the MMC threshold programme, assistance will be given for targeted policy and institutional reforms. The grants complement other US and international development programmes.
There are two primary types of MCC grants—compact and threshold. Compacts are large five-year grants for countries that qualify MCC’s eligibility criteria, where as threshold programmes are smaller grants awarded to countries that come close to passing these criteria and are firmly committed to improving their policy performance.
MCC is yet to announce how much Nepal would get under the threshold programme. But a senior official at the Ministry ofFinance in Kathmandu says it could be in the range of $100 million to $250 million.
Nepal can get into the compact programme if it performs well under the threshold programme. Countries qualifying for MCC compact programmes will get assistance for the infrastructure sector such as roads, irrigation and social sector such as health and education. Countries like Indonesia, Philippines, Armenia, Burkina Faso and Honduras are recipients of MCC assistance under the compact programme.
Nepal’s entry into MCC assistance list illustrates that US’ Nepal assistance policy is getting generous. Both the countries (Nepal and US) signed Trade and Investment Framework Agreement (TIFA) in April 2011. The agreement has provided institutional framework for bilateral talks to enhance trade and investment, discuss trade issues and promote more comprehensive trade agreement between the two countries. Similarly, the US Congress recently launched the bipartisan Congressional caucus on Nepal, the first ever caucus—a discussion group—formed on Nepal in the US Congress.
Ambika Adhikari, professor at Arizona State University , termed the inclusion of Nepal under the MCC list ‘a positive development’. “With Nepal all set to enter a new phase from transition, it needs technical assistance,” said Adhikari. “Nepal will be benefited more, as the MCC assistance other than the USAID assistance.”
The US Embassy in Kathmandu has welcomed the MCC’s decision, saying it recognised the progress Nepal has made in advancing peace and prosperity for its people. “We look forward to the Government of Nepal’s leadership in working with MCC and the Embassy in designing a threshold programme that will continue to advance the government’s efforts to create a democratic state focused on meeting the needs of the citizens of Nepal,” read the embassy’s statement.
Posted on: 2011-12-18 09:27
