Millennium Challenge Corporation

The Millennium Challenge Account ( MCA) is an association founded in 2004 by the U.S. Government development assistance funds. The fund is characterized by strict rules, a bureaucratic allocation of funds, through a transparent tendering process, a stronger involvement of the beneficiary countries in the use of resources and by a high degree of independence from political influence. To ensure independence and a non-bureaucratic procurement process, the means of a to be established for this purpose, independent organization managed the Millennium Challenge Corporation ( MCC). The Chief Executive Officer of the MCC is determined by the U.S. Senate. Chairman of the MCC Board is the Secretary of State (since 2009 Hillary Clinton). The Board also represented are the head of the U.S. Agency for International Development (USAID ) and the treasurer of the federal government.

Originally, the fund should be equipped with five billion U.S. dollars, which would have meant an increase in the American spending on development aid by about 50 % (or the global development aid by 9 %). To date, the Congress approved 2.48 billion U.S. dollars.

To date, the MCA has declared a total of 17 countries eligible for and concluded four contracts with eligible developing countries ( Cape Verde, Honduras, Nicaragua, Madagascar) with a total of about 600 million U.S. dollars.

Topics

The establishment of the MCA is pursuing different objectives on the part of the administration of President George W. Bush. The key here is that for years growing criticism of conventional development aid programs, particularly the conservative side. Be criticized for lack of development successes of the developing countries that would arise in particular by the lack of attention paid to economic conditions in the allocation of funds, lack of willingness to reform the recipient countries as well as to low efficiency orientation of the development programs.

The main reason for the establishment of the MCA was the terrorist attacks of 11 September 2001. The MCA was first included in the National Security Strategy (NSS ) of the United States from the year 2002. The MCA should therefore help to reduce poverty and instability in developing countries, the be regarded as one of the main reasons for international terrorism.

Qualification

Order to qualify for the MCA are low income countries with an average annual income of less than 1465 U.S. dollars. From 2006 to promote with an average per capita income between 1465 dollars and 3035 dollars and lower middle income countries.

For the selection of eligible countries 16 publicly available indicators are used, which were divided into three categories:

1 Ruling Justly 1 Control of Corruption 2 Rule of Law 3 Voice and Accountability Government Effectiveness 4th 5th 6th Civil Liberties Political Rights

2 Investing in People 7 Immunization rate 8 Primary Education Completion Rate 9 Public Primary Education Spending / GDP 10 Public Expenditure on Health / GDP

Order must be at least half of the indicators in each category above the median to qualify for MCA funds a candidate country. The median for corruption is particularly important. If a country for this indicator below the median it will be automatically disqualified for MCA funds. In this way, only countries should be promoted, who have shown their willingness to reform, good economic policy and good governance.

Autonomy in the use of funds

The concentration of the MCA on top performer allows a largely autonomous use of funds by the recipient countries. Thus one of the problems is solved, have to contend with the other development organizations. As development aid often flows in countries with poor and corrupt governments, development aid can only be used in well-defined projects, but they are not sustainable in most cases and do not contribute to the development of the recipient country. The MCA funds are, however, independently managed and used by the MCA - recipient countries, thereby ensuring that they meet the needs of the country.

Critique of Jeffrey Sachs

The renowned American Development economist criticized in his book " The End of Poverty " American policy under the Bush administration. So only flow about a billion dollars a year in the Millennium Challenge Account, while cost of Iraq war and its consequences to the five billion dollars per month.

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