Washington Times examines how U.S. assesses corruption in aid recipient countries

Aug 26 2010

The Washington Times continues its coverage of the challenges facing the U.S. Millennium Challenge Corporation (MCC) - "the U.S. government agency that provides large-scale grant to … chosen countries to reduce poverty and stimulate economic growth. … Although MCC says control of corruption is the single most important indicator by which a nation is deemed qualified for aid money, a review of the State Department's most recent report on human rights reveals that … virtually every country receiving similar grants - has been criticized for government corruption."

The article details the findings of the State Department's 2009 human rights report, which names instances of corruption in countries that have or will soon receive MCC funds, including Benin, Mozambique and Moldova. The piece also examines instances of corruption in Senegal.

"The persistence of corruption in grantee nations has drawn concern to a program generally hailed as innovative, which has forged a total of $7.2 billion in multiyear aid agreements with MCC in 20 countries," the newspaper writes.

According to the Washington Times, "Congress has never provided the total funding requested by either" former U.S. President George W. Bush - who first established the program - or President Barack Obama. "For fiscal 2010 (.pdf), Congress appropriated $1.1 billion for MCC, $320 million less than what the Obama administration requested," the newspaper continues.

Though "[t]he State Department reports detail varying degrees of corruption within the judiciary, the police and the military, and in the political processes of 18 of the 20 MCC-funded countries," an MCC spokeswoman "said … the group mainly bases its decisions on its own score cards, which use publicly available information not generated by the U.S. government or by the countries seeking the grant."

The article describes how the MCC assessments differ from those of the State Department, before noting, "[w]hile the countries criticized in the State Department reports generally have earned passing grades in the World Bank index, five countries - Benin, the Republic of Georgia, Honduras, Armenia and Nicaragua - twice in the course of the grant period got failing grades for control of corruption without losing [MCC] funding."

"In each of these cases, we determined that the changes in the score were not representative of a significant policy reversal and therefore did not merit a suspension or termination action by MCC," Sheila Herrling, MCC vice president for policy and evaluation, said. "Instead, MCC began a policy dialogue with each of the countries in question." Herrling "said a country can fail the indicator because of performance declines, but also because of changes in measurement standards or improvements in the availability or quality of data," the Washington Times reports.

The article includes comments by Reps. Kay Granger (R-Tex.) and Nita Lowey (D-N.Y.), as well as Daniel Kaufmann of the Brookings Institution, Peter Pham of the Africa Project at the National Committee on American Foreign Policy and Sarah Jane Staats of the Center for Global Development (Neubauer/Cella, 8/22).