Cape Verde Praised for Good Governance by Millennium Challenge Corporation
African country uses good governance as "strategic asset," says MCC's Applegarth
By Charles W. Corey Washington – The people of Cape Verde treat “good governance, transparency and the rule of law as a strategic asset,” and that is key to creating an environment conducive to long-term poverty reduction and economic growth, says Paul V. Applegarth, chief executive officer of the Millennium Challenge Corporation (MCC), which recently signed a $110 million, five-year compact with that African nation. Applegarth made that point at a briefing at the U.S. Foreign Press Center in Washington July 13. He was joined by Jose Maria Neves, the prime minister of Cape Verde, to brief reporters on the compact Cape Verde recently signed with the United States. The strategic use of good governance and other key qualities are being used as a “competitive tool” by Cape Verdeans to improve the economic health of their country and “that is the kind of performance that we are trying to encourage” as part of the Millennium Challenge Corporation process, Applegarth told reporters. Applegarth said MCC is about poverty reduction through sustainable economic growth, about providing “more aid … and more effective aid, making sure the [MCC] money is used well.” The underlying MCC premise, he said, links greater contributions or additional assistance from developed countries to greater responsibility from developing countries. He acknowledged that the effectiveness rate of foreign aid has been “mixed” with successes and programs that have not been done so well. MCC, he said, is built on the lessons learned -- that countries must take responsibility for their development and must put good policies in place to promote poverty and economic growth. “Cape Verde is an example of both of those things happening, and being done well,” he stressed. The Millennium Challenge Corporation seeks to help developing countries help themselves, he said. In the 10 months since MCC has begun receiving country proposals, he said, it has committed between $600 million and $650 million in funding. In addition to the dollars provided by MCC, he said, the corporation “is now seeing the impact of its programs on policy or what the World Bank is now calling the ‘MCC effect’ on good governance.” Overall, Applegarth said, MCC is about trying to encourage countries to adopt good policies for their long-term health. “Fundamentally,” he said, it is “a lot more important” that countries adopt good policies that will bring them long-term economic growth and development. “While the Millennium Challenge Corporation can help [with development],” he said, “the policy environment in many ways is more important than the money. So the fact that the ‘MCC effect’ is happening not only in the eligible countries but also in the threshold countries and those competing for MCC assistance we think is very important. “Countries do compete for our assistance,” he told reporters, and “we are looking for good partners that will use our money well, and in that sense we are very proud to have Cape Verde as a partner and congratulate them on this achievement. “Cape Verde has an outstanding record on democratic governance, transparency, fighting corruption and has created a world class fiscal system. These are the values that best serve the people of Cape Verde and values that Americans hold dear and want to support and encourage.” The country constructed its own program, he said, to help reduce poverty and stimulate economic growth and private sector development through investment in water resources, agricultural productivity, agricultural and road improvements and initiatives that promote the private sector and financial sector reform. The Cape Verde Compact program, Applegarth explained, will help thousands of Cape Verdeans achieve better access to markets, schools, health facilities, credit and agricultural resources. He called Cape Verde a country that could be a model for other countries and said it was no coincidence that the compact was signed in Cape Verde at the country’s 30th anniversary of independence. “The timing was very much related.” Cape Verde was the second African country to sign a compact or major agreement with the MCC, behind Madagascar. In his remarks, Prime Minister Neves called the MCC an “innovative program" for his country. "We do believe the MCC program will help change the mechanisms of international cooperation – especially helping the poorest countries,” he said. Neves said, “More and more we propose and defend the idea that merit, performance and success should always be rewarded,” as in the MCC program. An important part of the Millennium Challenge Account (MCA) is partnership, he said, and the fact that it “works as a lever for transformation and change” in a country. Through MCA, he said, Cape Verde will be better able to compete in the world economy and that is important for the overall development of his country. He called MCA an “extraordinary project,” not only for now but into the future for Cape Verde. The project, he said, stands as an “acknowledgement” of good governance in Cape Verde, economic freedom and the long-term investments that have been made. The Millennium Challenge Corporation was established on January 23, 2004, and administers the Millennium Challenge Account, a groundbreaking initiative that is designed to reduce poverty by promoting sustainable economic growth. |