[Federal Register Volume 89, Number 178 (Friday, September 13, 2024)]
[Notices]
[Pages 74997-74998]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-20752]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 24-05]


Notice of Entering Into a Compact With the State of Belize

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: In accordance with the provisions of the Millennium Challenge 
Act of 2003, as amended, the Millennium Challenge Corporation (MCC) is 
publishing a summary of the Millennium Challenge Compact (Compact) 
between the United States of America and the State of Belize. 
Representatives of the United States of America and the State of Belize 
executed the Compact on September 4, 2024. The complete text of the 
Compact has been posted at: https://www.mcc.gov/resources/doc/compact-belize/.

(Authority: 22 U.S.C. 7709 (b)(3))

    Dated: September 9, 2024.
Peter E. Jaffe,
Vice President, General Counsel, and Corporate Secretary.

Summary of Belize Compact

Overview of MCC Belize Compact

    MCC has signed a five-year, $125 million compact with the 
government of Belize aimed at reducing poverty through economic growth. 
The Compact seeks to assist Belize in addressing two binding 
constraints to economic growth--low quality of education and high cost 
of electricity. The Compact will address these constraints through two 
primary projects--the Education Project and the Energy Project.

Background and Context

    Belize is a small, diverse, coastal nation with a population of 
397,483 (2022). As a stable democracy located at the crossroads of the 
Caribbean and Central America, Belize maintains strong commercial and 
educational ties to the Caribbean and has increasingly strengthened 
ties with Central America.
    While Belize's economy has historically relied on the export of 
forest products, sugar, and fruit, tourism began to expand rapidly in 
the 1990s, contributing to robust real per capita income (``PCI'') 
growth averaging 4.3% for the next decade. However, from 2004 to 2019 
real PCI growth was near zero. In 2020, Belize experienced a sharp fall 
in tourism revenue and real PCI fell by 16%, which caused Belize to be 
classified as a lower middle-income country. The economy has since 
rebounded. As of 2018, 52% of the population had income below the 
Belizean general poverty line, with four socioeconomic groups 
disproportionately affected: Maya populations, rural households, women, 
and youth.

Country Selection and Ongoing Eligibility

    MCC's Board of Directors selected Belize as eligible to develop a 
compact in December 2021. In selecting Belize for a compact, MCC's 
Board made the decision to partner with a country that has demonstrated 
a clear commitment to democratic governance and tackling development 
challenges.In the year following its selection, Belize was reclassified 
by the World Bank as an upper middle-income country and exited MCC's 
candidate country pool. The Board has since repeatedly affirmed its 
support for Belize continuing to develop a compact with MCC, and the 
country has continued to demonstrate its commitment to the principles 
of democratic governance that underpin MCC's eligibility criteria and 
scorecard.

Constraints Analysis

    In April 2022, the Government of Belize selected two binding 
constraints to economic growth for further program development in the 
education and energy sectors.
    The education sector has a severe shortage of post-primary 
graduates as well as skilled workers in key industries. The Belize 
education system does not produce a sufficient number of individuals 
with the types of competencies needed by the labor market. Shifts in 
Belize's economic and employment landscape have increased the demand 
for workers with higher levels of qualifications and 21st century 
skills. However, over half of Belize's labor force currently does not 
have any form of post-primary education resulting in the first binding 
constraint for the Compact: low quality of education that leads to a 
shortage of trained professionals in all industries.
    In the energy sector the cost of wholesale electricity is higher 
than it should be compared to a well-functioning competitive 
electricity market. The primary driver of high electricity rates is the 
elevated cost of purchasing wholesale power, which results in the 
second binding constraint for the Compact: high cost of electricity 
that drives up input costs for all industries.
    The Government of Belize has shown strong country ownership and 
commitment to the Compact through their engagement on the technical 
design of the projects, their repeated commitment and preliminary 
progress on policy reforms, and their commitment of counterpart funding 
for the implementation and long-term sustainability of the compact 
objectives. MCC successfully concluded compact negotiations with the 
Government of Belize in mid-April and secured approval for the $125 
million investment from the MCC Board of Directors on June 26, 2024. 
The Government of Belize and MCC signed the Compact on September 4, 
2024 in Belize City, Belize.

Project Summaries

    The projects and activities to be completed are:
    The Education Project ($73.8 million) aims to equitably increase 
the number of post-primary graduates with the competencies relevant to 
labor market demands by pursuing the following activities and outcomes:
    [ssquf] Transforming Teaching and Learning in Secondary Education 
Activity aims to improve the numeracy, literacy, and 21st century 
skills of secondary graduates by improving the capability and 
accountability of the Ministry of Education, Culture, Science, and 
Technology, managing authorities, educators, and other actors in the 
Belizean educational system for providing inclusive, quality education.
    [ssquf] Access to and Progression through Secondary Education 
Activity aims to increase the percentage of primary graduates that 
enroll in and complete secondary school.
    [ssquf] Training and Transitioning to Work Activity aims to improve 
the capability of Technical and Vocational Education and Training 
(TVET) providers to deliver high quality training demanded by the labor 
market as well as to provide inclusive access to these training 
opportunities.
    The project focuses on inclusion and equity by intentionally 
creating opportunities across all three activities for members of 
groups that have been traditionally excluded in the Belizean

[[Page 74998]]

educational context, particularly students living with trauma, those 
with special education needs, immigrant students, and indigenous 
students. Additionally, special emphasis will be placed on closing 
gender gaps facing male students (in transition, retention, and 
graduation) and female students (in participation in workforce 
preparation).
    The Energy Project ($21.7 million) aims to reduce the wholesale 
cost of electricity in real terms through supporting the competitive 
procurement of lower cost power purchase agreements using energy 
alternatives that would displace higher cost imports by pursuing the 
following activity and outcomes:
    [ssquf] Facilitating New Lower-Cost Renewable Generation Activity 
is designed to support Belize in implementing its utility scale solar-
powered energy expansion plans and maintaining the stability of the 
grid.

Policy Reform and the Compact

    MCC and Belize jointly identified the following key policy reform 
areas to support the sustainability of the proposed compact, the timing 
and content of which was negotiated with Belize and is included in the 
compact.
    Key policy reforms of the Education Project include reforming the 
Education Act to require national student assessments to meet minimum 
testing requirements, school-level results to be published, and a more 
rigorous evaluation process for teacher licensing and certification. 
Additional reforms include increasing the compulsory school age to 16 
from 14, ensuring access to free secondary education to all primary 
graduates by offering free education at all government schools and, to 
ensure adequate geographical coverage, select grant-aided schools, and 
requiring each secondary school have a dedicated school counselor.
    Key policy reforms of the Energy Project include the approval of 
regulations governing the process for competitive procurement for 
electricity generation, limits on amendments and extensions of power 
purchase agreements to improve transparency and protect consumers and 
revising the grid code to clarify the interconnection requirements for 
variable alternative forms of energy.

Compact Overview and Budget

    Below is a summary describing the components of the Compact with 
Belize. The anticipated budget for the overall program is $165,650,000, 
with up to $125,000,000 under the Compact and $40,650,000 of 
contribution from Belize.

                 Table 1--Belize Compact Program Budget
                            [Million in US$]
------------------------------------------------------------------------
                                                              Amount
------------------------------------------------------------------------
                    MCC Funding by Compact Components
------------------------------------------------------------------------
1. Education Project:
    1.1 Transforming Teaching and Learning in Secondary      $41,045,000
     Education..........................................
    1.2 Access to and Progression through Secondary           16,256,000
     Education..........................................
    1.3 Training and Transitioning to Work..............      16,500,000
                                                         ---------------
        Subtotal........................................      73,801,000
------------------------------------------------------------------------
2. Energy Project:
    2.1 Facilitating New Lower-Cost Renewable Generation      21,684,000
                                                         ---------------
        Subtotal........................................      21,684,000
------------------------------------------------------------------------
3. Monitoring and Evaluation............................       1,820,000
4. Program Administration and Oversight.................      27,695,000
                                                         ---------------
    Total MCC Compact Funding...........................     125,000,000
------------------------------------------------------------------------
                          Total Program Funding
------------------------------------------------------------------------
Total MCC Compact Funding...............................     125,000,000
Government of Belize Contribution.......................      40,650,000
                                                         ---------------
    Total Program.......................................     165,650,000
------------------------------------------------------------------------

[FR Doc. 2024-20752 Filed 9-12-24; 8:45 am]
BILLING CODE 9211-03-P