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###### Millennium Challenge Corporation

          - [MCC FR 09-17]

# AGENCY:

Millennium Challenge Corporation.

# ACTION:

Notice.

# SUMMARY:

Section 608(d) of the Millennium Challenge Act of 2003 requires the Millennium Challenge Corporation to publish a report that identifies countries that are “candidate countries” for Millennium Challenge Account assistance during FY 2010. The report is set forth in full below.

Dated: September 10, 2009.

Henry C. Pitney,

(Acting) Vice President and General Counsel, Millennium Challenge Corporation.

## Report on Countries That Are Candidates for Millennium Challenge Account Eligibility for Fiscal Year 2010 and Countries That Would Be Candidates But for Legal Prohibitions

This report to Congress is provided in accordance with Section 608(a) of the Millennium Challenge Act of 2003, 22 U.S.C. 7701, 7707(a) (Act).

                    The Act authorizes the provision of Millennium Challenge Account (MCA) assistance for countries that enter into Compacts with the United States to support policies and programs that advance the progress of such countries achieving lasting economic growth and poverty reduction. The Act requires Millennium Challenge Corporation (MCC) to take a number of steps in selecting countries with which MCC will seek to enter into a compact, including (i) determining the countries that will be eligible for MCA assistance for fiscal year 2010 (FY10) based on a country's demonstrated commitment to (a) just and democratic governance, (b) economic freedom, and (c) investing in its people; and (ii) considering the opportunity to reduce poverty and generate economic growth in the country. These steps include the submission of reports to the congressional committees specified in the Act and the publication of notices in the                     **Federal Register**                     that identify:                

1. The countries that are “candidate countries” for MCA assistance for FY10 based on their per-capita income levels and their eligibility to receive assistance under U.S. law and countries that would be candidate countries but for specified legal prohibitions on assistance (section 608(a) of the Act);

2. The criteria and methodology that the MCC Board of Directors (Board) will use to measure and evaluate the relative policy performance of the “candidate countries” consistent with the requirements of subsections (a) and (b) of section 607 of the Act in order to select “MCA eligible countries” from among the “candidate countries” (section 608(b) of the Act); and

3. The list of countries determined by the Board to be “MCA eligible countries” for FY10, identification of such countries with which the Board will seek to enter into compacts, and justification for such eligibility determination and selection for compact negotiation (section 608(d) of the Act).

This report is the first of three required reports listed above.

## Candidate Countries for FY 2009

The Act requires the identification of all countries that are candidates for MCA assistance for FY10 and the identification of all countries that would be candidate countries but for specified legal prohibitions on assistance. Sections 606(a) and (b) of the Act provide that for FY10 a country shall be a candidate for the MCA if it:
      - Meets one of the following two income level tests:

○ Has a per capita income equal to or less than the historical ceiling of the International Development Association eligibility for the fiscal year involved (or $1,855 gross national income (GNI) per capita for FY10) (the “low income category”); or

○ Is classified as a lower middle income country in the then most recent edition of the World Development Report for Reconstruction and Development published by the International Bank for Reconstruction and Development and has an income greater than the historical ceiling for International Development Association eligibility for the fiscal year involved (or $1,856 to $3,855 GNI per capita for FY10) (the “lower middle income category”); and

○ Is not ineligible to receive U.S. economic assistance under part I of the Foreign Assistance Act of 1961, as amended, (the “Foreign Assistance Act”), by reason of the application of the Foreign Assistance Act or any other provision of law.

Pursuant to section 606(c) of the Act, the Board has identified the following countries as candidate countries under the Act for FY10. In so doing, the Board has anticipated that prohibitions against assistance as applied to countries in the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2009 (Div. H, Pub. L. 111-8) (FY 2009 SFOAA), will again apply for FY10, even though the Department of State, Foreign Operations, and Related Programs Appropriations Act for FY10 has not yet been enacted and certain findings under other statutes have not yet been made. As noted below, MCC will provide any required updates on subsequent changes in applicable legislation or other circumstances that affects the status of any country as a candidate country for FY10.

## Candidate Countries: Low Income Category

1. Afghanistan

2. Bangladesh

3. Benin

4. Bolivia

5. Burkina Faso

6. Burundi

7. Cambodia

8. Cameroon

9. Central African Republic

10. Chad

11. Comoros

12. Dem. Republic of the Congo

13. Djibouti

14. Egypt, Arab Rep.

15. Eritrea

16. Ethiopia

17. Gambia

18. Ghana

19. Guinea

20. Guinea Bissau

21. Guyana

22. Haiti

23. Honduras

24. India

25. Kenya

                    26. Kosovo                          ( print page 47619)    

27. Kyrgyz Republic

28. Lao PDR

29. Lesotho

30. Liberia

31. Malawi

32. Mali

33. Moldova

34. Mongolia

35. Mozambique

36. Nepal

37. Nicaragua

38. Niger

39. Nigeria

40. Pakistan

41. Papua New Guinea

42. Rwanda

43. Sao Tome and Principe

44. Senegal

45. Sierra Leone

46. Solomon Islands

47. Somalia

48. Sri Lanka

49. Tajikistan

50. Tanzania

51. Togo

52. Uganda

53. Vietnam

54. Yemen, Rep.

55. Zambia

## Candidate Countries: Lower Middle Income Category

1. Albania

2. Angola

3. Armenia

4. Azerbaijan

5. Belize

6. Bhutan

7. Cape Verde

8. Congo, Rep.

9. Ecuador

10. El Salvador

11. Georgia

12. Guatemala

13. Indonesia

14. Jordan

15. Kiribati

16. Maldives

17. Marshall Islands

18. Micronesia, Fed. Sts.

19. Morocco

20. Paraguay

21. Philippines

22. Samoa

23. Swaziland

24. Thailand

25. Timor-Leste

26. Tonga

27. Tunisia

28. Turkmenistan

29. Tuvalu

30. Ukraine

31. Vanuatu

## Countries That Would Be Candidate Countries But for Legal Prohibitions That Prohibit Assistance

Countries that would be considered candidate countries for FY10, but are ineligible to receive United States economic assistance under part I of the Foreign Assistance Act by reason of the application of any provision of the Foreign Assistance Act or any other provision of law are listed below. As noted above, this list is based on legal prohibitions against economic assistance that apply for FY 2009 and that are anticipated to apply again for FY10.

## Prohibited Countries: Low Income Category

                        1.                         *Burma*                         is subject to numerous restrictions, including but not limited to section 570 of the FY 1997 Foreign Operations, Export Financing, and Related Programs Appropriations Act (P.L. 104-208) which prohibits assistance to the government of Burma until it makes progress on improving human rights and implementing democratic government, and due to its status as a major drug-transit or major illicit drug producing country for 2008 (Presidential Determination No. 2008-28 (9/16/2008)) and a Tier III country under the Trafficking Victims Protection Act (Presidential Determination No. 2009-5 (10/17/2008)).                    

                        2.                         *Cote d'Ivoire*                         is subject to section 7008 of the FY 2009 SFOAA, which prohibits assistance to the government of a country whose duly elected head of government is deposed by military coup or decree.                    

                        3.                         *Madagascar*                         is subject to section 7008 of the FY 2009 SFOAA, which prohibits assistance to the government of a country whose duly elected head of government is deposed by military coup or decree.                    

                        4.                         *Mauritania*                         is subject to section 7008 of the FY 2009 SFOAA, which prohibits assistance to the government of a country whose duly elected head of government is deposed by military coup or decree.                    

                        5.                         *North Korea*                         is subject to numerous restrictions, including section 7076 of the FY 2009 SFOAA which prohibits any direct assistance to the government.                    

                        6.                         *Sudan*                         is subject to numerous restrictions, including but not limited to section 620A of the Foreign Assistance Act which prohibits assistance to governments supporting international terrorism, section 7012 of the FY 2009 SFOAA, and section 620(q) of the Foreign Assistance Act, both of which prohibit assistance to countries in default in payment to the U.S. in certain circumstances, section 7008 of the FY 2009 SFOAA, which prohibits assistance to a country whose duly elected head of government being deposed by military coup or decree, and section 7070(b) of the FY 2009 SFOAA.                    

                        7.                         *Uzbekistan's*                         central government is subject to section 7076 of the FY 2009 SFOAA, which states that funds may be made available for assistance to the central government of Uzbekistan only if the Secretary of State determines and reports to the Congress that the government is making substantial and continuing progress in meeting its commitments under a framework agreement with the United States.                    

                        8.                         *Zimbabwe*                         is subject to Section 620(q) of the Foreign Assistance Act and section 7012 of the FY 2009 SFOAA, which prohibit assistance to countries in default in payment to the United States in certain circumstances, and section 7070(e) of the FY 2009 SFOAA which prohibits assistance to the central government of Zimbabwe in the absence of a waiver by the Secretary of State.                    

## Prohibited Countries: Lower Middle Income Category

                        1.                         *China*                         is not eligible to receive economic assistance from the United States, absent special authority, because of concerns relative to China's record on human rights.                    

                        2.                         *Iran*                         is subject to numerous restrictions, including but not limited to section 620A of the Foreign Assistance Act which prohibits assistance to governments supporting international terrorism and section 7007 of the FY 2009 SFOAA which prohibits direct assistance.                    

                        3.                         *Iraq*                         is subject to section 7042 of the FY 2009 SFOAA, which prohibits the use of FY 2009 SFOAA funds for assistance for Iraq, and section 620(t) of the Foreign Assistance Act which prohibits assistance to a country which has severed diplomatic relations with the United States, until such diplomatic relations are restored and framework bilateral assistance agreements are in place.                    

                        4.                         *Syria*                         is subject to numerous restrictions, including but not limited to 620A of the Foreign Assistance Act which prohibits assistance to governments supporting international terrorism, section 7007 of the FY 2009 SFOAA which prohibits direct assistance, and section 7012 of the FY 2009 SFOAA and section 620(q) of the Foreign Assistance Act, both of which prohibit assistance to countries in default in payment to the U.S. in certain circumstances.                    

Countries identified above as candidate countries, as well as countries that would be considered candidate countries but for the applicability of legal provisions that prohibit U.S. economic assistance, may be the subject of future statutory restrictions or determinations, or changed country circumstances, that affect their legal eligibility for assistance under part I of the Foreign Assistance Act by reason of application of Foreign Assistance Act or any other provision of law for FY10. MCC will include any required updates on such statutory eligibility that affect countries' identification as candidate countries for FY10, at such time as it publishes the notices required by sections 608(b) and 608(d) of the Act or at other appropriate times. Any such updates with regard to the legal eligibility or ineligibility of particular countries identified in this report will not affect the date on which the Board is authorized to determine eligible countries from among candidate countries which, in accordance with section 608(a) of the Act, shall be no sooner than 90 days from the date of publication of this report.

[FR Doc. E9-22306 Filed 9-11-09; 4:15 pm]

BILLING CODE 9211-03-P