Fact Sheet

MCC Compacts 

Lead to Economic Growth

The Millennium Challenge Corporation (MCC) is an innovative and independent U.S. foreign aid agency 

that is helping lead the fight against global poverty. Created by the U.S. Congress in 2004 with strong 

bipartisan support, MCC is changing the conversation on how best to deliver smart U.S. foreign aid by 

focusing on good policies, country ownership, and results. 

An MCC compact is a multi-year agreement between the Millennium Challenge Corporation and a 

partner country to fund specific programs designed to reduce poverty and stimulate economic growth. 

Recognizing that sustainable development is best achieved by fostering country ownership, good policies, 

and investment in people, MCC provides selected eligible countries the opportunity to identify their own 

priorities for achieving economic growth and poverty reduction. 

Every MCC compact reflects its country’s specific priorities and details program objectives, implementation methods, and monitoring and evaluation strategies, while ensuring financial accountability, transparency, and fair and open procurement processes. To date, MCC has signed 26 development assistance 

compacts totaling nearly $9.3 billion.

Summary of MCC Compacts

Armenia

The $235 million Armenia Compact focused on increasing economic performance in the agricultural 

sector. The compact consisted of strategic investments in rural roads and irrigated agriculture to provide 

communities and rural residents with reduced transport costs and better access to jobs, markets and 

social services; and to increase productivity of 250,000 farmer households through improved water supply, higher yields, higher-value crops, and a more competitive agricultural sector. In June 2009, the MCC 

Board of Directors enacted a hold on funding for further road construction and rehabilitation as a result 

of Government of Armenia actions inconsistent with MCC principles promoting democratic governance. 

The compact was completed in September 2011.

Benin

The $307 million Benin Compact sought to increase investment and private sector activity in Benin. 

The compact was comprised of four projects: increasing access to land through more secure and useful 

land tenure; expanding access to financial services through grants given to micro, small, and medium 

enterprises; providing access to justice by bringing courts closer to rural populations; and improving 

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access to markets by eliminating physical and procedural constraints currently hindering the flow of 

goods through the Port of Cotonou. The compact was completed in September 2011; MCC’s Board of 

Directors has selected Benin as eligible to develop a proposal for a second compact.

Burkina Faso

The $481 million Burkina Faso Compact will increase investment in rural productivity through improved 

land tenure security and land management; increase the volume and value of agricultural production 

through investments in water management and irrigation, technical assistance to farmers, and rural 

credit; and increase opportunities for farmers to sell agricultural goods and livestock by rehabilitating 

rural and primary roads. As an extension of Burkina Faso’s successful MCC Threshold Program, the 

compact also funds the construction of three classrooms each at 132 “girl-friendly” schools for grades four 

through six.

Cape Verde

The $110 million Cape Verde Compact helped Cape Verde achieve its national development goal of 

transforming its economy from aid-dependency to sustainable, private sector-led growth. The compact 

sought to increase rural incomes of the poor by increasing agricultural productivity, integrating internal 

markets, reducing transportation costs, and developing the private sector through greater private sector 

investment and financial sector reform. The compact was completed in October 2010; Cape Verde’s 

second compact was signed in February 2012.

Cape Verde’s $66.2 million second compact is designed to reduce poverty through economic growth. 

The two projects in this compact are intended to increase household incomes by reforming two sectors 

identified as current constraints to economic growth: the water and sanitation sector and the land 

management sector. This compact builds off the success of Cape Verde’s first MCC compact and upholds 

high standards for accountability, transparency and achieving results. 

El Salvador

The $461 million El Salvador Compact seeks to improve the lives of Salvadorans through strategic 

investments in education, public services, enterprise development, and transportation infrastructure. The 

compact’s Human Development Project is designed to increase employment opportunities for the region’s 

poorest inhabitants and provide greater access to safe water and sanitation services. The compact will be 

completed in September 2012; MCC’s Board of Directors has selected El Salvador as eligible to develop a 

proposal for a second compact.

Georgia

The $295 million Georgia Compact helped Georgians reduce poverty by renovating key regional 

infrastructure and improving the development of regional enterprises. The compact enhanced 

productivity in farms, agribusinesses and other enterprises that will increase jobs and rural income. 
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The compact was completed in April 2011; MCC’s Board of Directors has selected Georgia as eligible to 

develop a proposal for a second compact.

Ghana

The $547 million Ghana Compact sought to reduce poverty by raising farmer incomes through private 

sector-led, agribusiness development. Specifically, MCC investments were designed to increase the 

production and productivity of high-value cash and food staple crops in some of Ghana’s poorest regions 

and to enhance the competitiveness of Ghana’s agricultural products in regional and international 

markets. The compact was completed in February 2012; MCC’s Board of Directors has selected Ghana as 

eligible to develop a proposal for a second compact. 

Honduras

The $215 million Honduras Compact sought to reduce poverty by increasing farmer productivity and 

entrepreneurship, and by reducing transportation costs between targeted production centers and 

national, regional and global markets. In September 2009, MCC’s Board of Directors partially terminated 

the Honduras Compact as a result of Government of Honduras actions inconsistent with MCC’s 

eligibility criteria. The compact was completed in September 2010; MCC’s Board of Directors selected 

Honduras as eligible to develop an MCC Threshold Program. 

Indonesia

The five-year, $600 million Indonesia Compact seeks to increase household incomes through three 

projects designed to increase productivity, reduce energy costs, and improve natural resource 

management; reduce and prevent low birth weight, childhood stunting, and malnourishment of children; 

and improve provision of public sector growth-enhancing goods and services. 

Jordan

The $275 million Jordan Compact funds three integrated projects focused on improving water supply, 

wastewater collection, and wastewater treatment and reuse. These projects will improve water delivery, 

decrease costs of potable water, and upgrade in-home water systems. They will also increase the amount 

of wastewater collected for treatment and reduce the incidents of sewage overflow. Finally, the compact 

will increase the volume of treated water that is available as a substitute for freshwater for nondomestic uses.

Lesotho

The $363 million Lesotho Compact is expected to have an economy-wide impact, affecting the entire 

population of Lesotho. The compact seeks to increase water supplies for industrial and domestic use; 

alleviate the devastating affects of poor maternal health, HIV/AIDS, tuberculosis and other diseases 
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by substantially strengthening the country’s health care infrastructure and human resources for health 

capacity; and remove barriers to foreign and local private-sector investment.

Madagascar 

The $110 million Madagascar Compact was designed to raise incomes by assisting the rural population 

transition from subsistence agriculture to a market-driven growth. The compact included three projects 

to help rural Malagasy secure formal property rights to land; access credit and protect savings; and 

receive training in agricultural production, management and marketing techniques. In May 2009, MCC’s 

Board of Directors terminated the Madagascar Compact as a result of Government of Madagascar 

actions inconsistent with MCC’s eligibility criteria.

Malawi

The $350.7 million Malawi Compact is a single-sector program focusing on activities that aim to revitalize 

Malawi’s power sector. By reducing power outages and technical losses, enhancing the sustainability 

and efficiency of hydropower generation, and improving service to electricity consumers, the compact 

intends to reduce energy costs to enterprises and households; improve productivity in the agriculture, 

manufacturing and services sectors; and support the preservation and creation of employment 

opportunities in the economy.

Mali

The $461 million Mali Compact sought to increase the productivity of the agriculture sector and regional 

enterprises. The compact was designed to serve as a catalyst for sustainable economic growth and 

poverty reduction through key infrastructure investments capitalizing on two of Mali’s major assets, the 

Bamako-Sénou International Airport, a gateway for regional and international trade; and the Niger River, 

a valuable source for irrigated agriculture. The MCC Board of Directors voted in May 2012 to terminate 

the Mali Compact due to an undemocratic change in government.

Moldova

The $262 million Moldova Compact will improve irrigation infrastructure and management; increase 

the production and marketing of high value agricultural products; and rehabilitate part of the country’s 

national road network. The highway is a key link for passenger travel and for internal commerce and 

trade; the repairs will reduce the time and cost to transport goods and services, and will reduce losses to 

the national economy resulting from deteriorated road conditions.

Mongolia

The $285 million Mongolia Compact seeks to increase economic activity by improving the ability of 

Mongolians to register and obtain clear titles to their land, expand vocational education in core technical 
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skills, and focus on the health and well-being of the labor force by reducing non-communicable diseases 

and injuries. The compact is also promoting the introduction of alternative energy and energy-efficient 

products to the market economy and is constructing transportation infrastructure to accommodate heavy 

traffic into Mongolia’s capital city. 

Morocco

The $697 million Morocco Compact seeks to increase productivity and improve employment in highpotential sectors including investments in fruit tree productivity, small-scale fisheries, and artisan crafts. 

Investments in financial services will also support entrepreneurship, small business development, and 

market growth. 

Mozambique

The $507 million Mozambique Compact seeks to increase the productive capacity of the population in 

selected districts with the intended impact of reducing the poverty rate, increasing household income 

and employment, and reducing chronic malnutrition. Compact programs aim to improve water systems, 

sanitation, access to markets, land tenure services, and agriculture in the targeted districts.

Namibia

The $304 million Namibia Compact will improve the quality of education and training for underserved 

populations and will capitalize on Namibia’s comparative advantages, including large areas of semi-arid 

communal land suitable for livestock and diverse wildlife and landscapes ideal for eco-tourism. These 

projects are designed to increase opportunities in rural areas and increase incomes.

Nicaragua

The $175 million Nicaragua Compact was designed to support those living in the Leon and Chinandega 

region by significantly increasing incomes of rural farmers and entrepreneurs. The compact sought to 

reduce transportation costs, improve access to markets, strengthen property rights, increase investment, 

and raise incomes for farms and rural businesses. In June 2009, the MCC Board of Directors partially 

terminated the Nicaragua Compact as a result of political conditions in Nicaragua inconsistent with 

MCC’s eligibility criteria. The compact was completed in May 2011.

Philippines

The $434 million Philippines Compact includes funds to repair 220 kilometers of the country’s Samar 

Road. This road will improve access to markets and services for farmers, fishers, and small businesses in 

some of the poorest provinces in the Philippines. The compact also includes funds to expand community 

development projects and to computerize and streamline business processes in the Bureau of Internal 
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Revenue to bolster the effectiveness of revenue collection and reduce opportunities for corruption.

Senegal

The $540 million Senegal Compact will reduce poverty and promote economic growth by unlocking 

the country’s agricultural productivity, engaging in infrastructure projects to rehabilitate major national 

roads, and investing in strategic irrigation and water resources management.

Tanzania

The $698 million Tanzania Compact seeks to rehabilitate roads to connect communities with markets, 

schools, and health clinics, and promote the expansion of economic opportunities by reducing transport 

costs. The compact also funds water infrastructure improvements that will increase access to potable 

water and will mitigate the incidence of water-related disease, burdensome healthcare costs, and 

decreased workforce productivity.

Vanuatu

The $65 million Vanuatu Compact improved the country’s poor road conditions by constructing and 

sealing two national roads, the Efate Ring road and the Santo East Coast road. The compact benefitted 

poor, rural agricultural producers and the tourism industry by reducing transportation costs and 

improving road conditions. The compact was completed in April 2011.

Zambia

The $355 million Zambia Compact seeks to address one of Zambia’s most binding constraints to economic 

growth through infrastructure investment in Lusaka, the rapidly urbanizing capital. The compact will 

invest in water supply, sanitation and drainage infrastructure in order to decrease the incidence and 

prevalence of water-related disease, reduce productive days lost due to disease and time spent collecting 

water, and lower costs. The compact will also support the Government of Zambia’s ongoing water sector 

reform efforts by strengthening partner institutions.

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For More Information

Please visit www.mcc.gov.