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论文作者:留学生论文论文属性:硕士毕业论文 dissertation登出时间:2022-01-10编辑:vicky点击率:2236

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Chapter 1 Millennium Challenge Corporation:An Innovation

1.1 MCC Background

In March 2002, President George W. Bush claimed to establish a new foreign aidprogram named the Millennium Challenge Account (MCA) to provide substantialfunding to those countries which are “ruling justly, investing in their people, andencouraging economic freedom” (Larry Nowels 2). The Millennium ChallengeCorporation (MCC) established in January 2004, is an independent U.S. foreignassistance agency. It was designed to run the new program which delivered aiddifferently, with a mission and model reflecting key principles of aid effectiveness.

President Bush announced that he would establish a new foreign assistanceagency to help poor and troubled countries at the Monterrey conference in March2002. This announcement came 14 months after his inauguration and six months afterthe 9.11 terrorist event. He promised that the U.S. foreign aid budget will be increasedby 50 percent over the next three years, which meant that there would be a $5 billionannual increase over the past levels. He further pledged to maintain economic aidamounts at least at this level in the future. The dramatic increase in U.S. foreign aidwas a transformational change for the Bush administration compared to the usualattitude of the Republican Party toward the poor and troubled areas of the world thatwere of little strategic importance to the U.S. In considering the terrorist attack ofSeptember 11, he claimed in his speech that global poverty and terrorism were linked,and therefore reducing poverty would help to alleviate terrorism (Francis Y. Owusu 2).“ Hope is an answer to terror, that’s why we have to fight against poverty,” he said,“in the past few decades, the success of development assistance has been measuredonly on the basis of the resources spent, not the results achieved. Investing in a failedstate not only does little to help the poor, but also can hamper the progress of thereform” ( George W. Bush Online 2002). Thus a new and more promising foreign aidform that connects with greater political and economic reforms is needed. Differentfrom the traditional foreign assistance system, the aid allocation mechanism of theMCC is largely based on a series of competitive assessments of developing countries’ governance performance. The MCA is the first and only bilateral aid agency that hasadopted a competitive aid allocation mechanism that explicitly relies on a set ofpublicly available governance indicators.

1.2 MCC’s Selection Process

Fundamentally, MCC is designed to provide aid with the focus on povertyreduction through sustainable economic growth. The selection process of the recipientcountries of the MCC is different and better. It rewards good performance by focusingexclusively on poor countries implementing sound economic development andpoverty reduction strategies. There are several steps in the country selection process:identifying candidate countries; formulating eligibility criteria; selecting compact andthreshold program-eligible countries.

1.21 MCC’s Selection Criteria and methodology


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