Washington Times examines how Millennium Challenge Corporation deals with recipient country corruption

Aug 18 2010

The Washington Times examines how the U.S. Millennium Challenge Corporation (MCC), which dispenses U.S. foreign aid "meant to help reduce global poverty by stimulating economic growth," deals with countries that initially pass screening tests, but are later suspected of corruption. The article looks specifically at Senegal, which is scheduled to receive "$540 million over five years [through MCC] to help farmers increase their productivity by improving the irrigation system and rehabilitating roads to help get products to market." The story examines several recent questionable expenditures by Senegal's government, such as the building of a $24 million bronze statue in capital of Dakar.

MCC "has signed multiyear 'compacts,' or agreements, with 20 countries to provide $7.2 billion in U.S. aid to reduce poverty," the newspaper notes. "The countries are selected based on 17 outside performance indicators. The most important is control of corruption." The article notes that since Senegal first received approval for MCC aid, signs of backtracking on governance have led "[c]ritics, including some members of Congress, [to] say the [MCC] aid should be reconsidered."

"Todd Moss, a senior fellow at the Center for Global Development, said the MCC board has to figure out what to do with a country like Senegal, which earned passing scores on the corruption indicators but 'is becoming an embarrassing example of the worst kinds of misuse of funds and abuse of authority,'" the newspaper writes. "MCC funding was the subject of an April congressional hearing, in which members of a House appropriations subcommittee from both sides of the aisle expressed concerns," according to the article.

During the meeting, members queried MCC CEO Daniel Yohannes about the mechanisms in place to "delay or stop funding in countries such as Senegal, which had been the subject of numerous corruption stories," the newspaper continues. "Yohannes … told the subcommittee that the MCC has never taken such a step in response to corruption reports in its six years of operation," but also added "the MCC takes corruption seriously, monitors the situations daily and could terminate, if necessary."

The article notes "cases of a coup or an undemocratic change of government or serious questions about elections, including in Madagascar, Honduras, Armenia and Nicaragua," when the MCC terminated or temporarily suspended agreements.

The article examines concerns about corruption raised by U.S. Ambassador to Senegal Marcia S. Bernicat and includes comments from Reps. Nita Lowey (D-N.Y.) and Ed Royce (R-Calif.), J. Peter Pham of the Africa Project at the National Committee on American Foreign Policy and a State Department official (Neubaurer, 8/15).