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Ambassador John J. Danilovich
UNESCO
April 4, 2006
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Thank you, Ambassador Oliver, for your kind introduction. It is always a pleasure to be in Paris and I am especially happy to see my good friend Louise. I am pleased to have the opportunity to address all of you who are actively engaged in UNESCO’s mission.
I would also like to acknowledge the ambassadors and representatives from that very select group of countries—those that have either qualified for full funding from the Millennium Challenge Corporation, or are near doing so. This is a great accomplishment, and I look forward to working with you and your fellow countrymen in our MCC partnership.
Just over two years ago, in 2004, Congress passed legislation to formally establish the Millennium Challenge Corporation, furthering the vision first articulated in 2002 by President Bush in Monterrey when he said:
“The needs of the developing world demand a new approach…we have a tremendous opportunity to begin acting on a new vision of development. This new vision unleashes the potential of those who are poor, instead of locking them into a cycle of dependence. This new vision looks beyond arbitrary inputs from the rich, and demands tangible outcomes for the poor.”
The President’s message was clear: Foreign aid should be about results, not simply giving donations or loans or grants. We work with countries that are committed to taking the difficult and at times previously unimaginable steps toward social, economic and political reform. We seek to provide assistance that has the potential to achieve truly significant improvements in institutional infrastructure, physical infrastructure, and standards of living across the developing world.
Standard setting should not be done at the expense of UNESCO’s programs. Moreover, no normative instrument should be negotiated at UNESCO unless it is truly necessary. If there is agreement that there is a real need for a normative instrument, we should insist that what emerges is a quality consensus document.
The Millennium Challenge Account is built on the belief that sustainable economic growth can best occur in countries that initially adopt and subsequently continue to adhere to good policies. Countries are selected to apply for MCC assistance based on sixteen policy indicators in three areas: ruling justly, investing in people, and promoting economic freedom. Countries that do not perform well in these areas are encouraged to improve and try again in the next selection round – and many are doing just that.
Millennium Challenge is not for everyone. Since selection is driven by scores and data, countries suffering from corruption, poor governance, and instability won’t receive our assistance.
Further, countries accepted into the program but fail to maintain passing scores on their policy indicators, or fail to design good proposals, or fail to rigorously implement their Compacts -- risk losing their eligibility. We will not hesitate to say “no” or “no more.”
We also believe that countries must take ownership of their own path to development, and therefore must come to us with their own proposals for funding. This is difficult and complex work. It stretches capabilities and in some cases establishes capabilities that did not previously exist.
Many countries have not been expected to take on this level of accountability and responsibility before … but it is an absolute prerequisite if we are serious about improving the effectiveness of our assistance and if the recipient country is serious about reducing poverty.
As you at UNESCO well understand, it is essential to build these human and institutional capacities, and we at MCC are committed to providing our partners the opportunity to do so.
In addition, we believe that a great many of the poor will thrive if they are provided access to healthy economic systems and if wealth creation strategies are made available to them.
We support programs designed to encourage increased incomes and create opportunities for the poor to overcome barriers that keep them from fully participating in basic economic activity.
MCC Compacts are removing these barriers by improving roads in Nicaragua, increasing the productivity of high-value crops in Honduras, and overhauling the antiquated land titling system in Madagascar.
Included in this overall strategy, we also target activities that remove impediments to the growth of human capital -- and we welcome proposals that include health and education projects.
Lifting nations out of poverty requires partnership -- not paternalism. From the outset, we insist that each country outline what our joint efforts will achieve. We believe that by focusing on the achievement of these results, our partnership will be better able to provide lasting hope and opportunity to those living in poverty. That is our aim. That is our objective.
The MCC is about human beings transcending statistics, and enabling and empowering citizens of poor countries to grow out of the poverty trap. Our success is defined not in terms of dollars spent, but by the long term sustainability of institutional reforms, by improved policies that unleash people’s potential, and by the increased productivity and wealth that come from the increases in human and physical infrastructure that our assistance funds.
So where does the MCC stand today? Altogether, 23 countries are eligible to make proposals for MCA assistance.
- Just last week I signed a $235 million Compact with Armenia, our eighth compact country.
- The other seven are Benin, Cape Verde, Georgia, Honduras, Madagascar, Nicaragua, and Vanuatu.
- We have committed approximately $1.5 billion to these countries, and we have more agreements in the pipeline.
These programs finance a wide range of activities, from rural roads to irrigation to small business development.
We also have 18 other countries that are on the “threshold” of full eligibility for MCA funding. In our “Threshold Program,” we make available smaller grants to help these countries improve their scores on those policy indicators where they are deficient.
- We have approved agreements with five Threshold countries so far: Albania, Burkina Faso, Malawi, Paraguay and Tanzania.
- These programs support a variety of policy reforms – particularly to fight corruption -- that help lay the groundwork for poverty reduction and sustainable economic growth.
As we continue to expand our operations, we look forward – with enthusiasm and optimism – to strengthening our partnerships, to providing support, and to creating together – in the words of President Bush - “an ever-widening circle of development.”
I thank you for your attention, and again thank you Louise, and all of you for the opportunity to be with you today. I welcome any questions you may have.
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