[Federal Register Volume 81, Number 152 (Monday, August 8, 2016)]
[Notices]
[Pages 52464-52466]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18756]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 16-02]


Notice of Entering Into a Compact With the Republic of Niger

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: In accordance with Section 610(b)(2) of the Millennium 
Challenge Act of 2003 (22 U.S.C. 7701-7718) as amended (the Act), and 
the heading ``Millennium Challenge Corporation'' of the Department of 
State, Foreign Operations, and Related Programs Appropriations Act, 
2015, the Millennium Challenge Corporation (MCC) is publishing a 
summary of the Millennium Challenge Compact between the United States 
of America, acting through the Millennium Challenge Corporation, and 
the Republic of Niger. Representatives of the United States Government 
and Niger executed the Compact documents on July 29, 2016. The complete 
text of the Compact has been posted at https://assets.mcc.gov/documents/niger-compact-signed.pdf.

    Dated: August 3, 2016.
Sarah Fandell,
Vice President and General Counsel, Millennium Challenge Corporation.

Summary of Millennium Challenge Compact With the Republic of Niger

Overview

    Niger, one of the poorest and least developed countries in the 
world, has consistently ranked last on the United Nations Human 
Development Index for the past 25 years. This land-locked West African 
country is almost twice the size of Texas, and two-thirds of the 
country's land mass is the Sahara Desert, making it one of the hottest 
and driest countries in the world. Niger has made notable improvements 
over the past few years, but over 40 percent of the population still 
lives below the global poverty line of $1.25 per day. Despite these 
challenges, the Nigeriens have demonstrated a strong commitment to 
governance reforms, economic growth, and investing in their people. The 
MCC Board of Directors (the ``Board'') selected Niger as eligible to 
develop a Millennium Challenge Compact in December 2012. Niger has 
consistently passed the MCC scorecard after doing so for the first time 
in 2012.
    Roughly 80 percent of Niger's population lives in rural areas and 
relies on agriculture for its livelihood. Moreover, over 90 percent of 
the population relies on a single, three-month, highly capricious rainy 
season to support agriculture and livestock production. Frequent 
droughts and floods decimate crops and productive assets, undermining 
the population's ability to build its resilience and economic security. 
In addition, sustainable natural resource management is lacking in this 
fragile environment, and water and pasture resources are frequently 
over-utilized, causing severe erosion of once productive areas. 
Agricultural productivity has stagnated due to a lack of access to 
critical productive inputs such as improved seed, fertilizer, 
irrigation, and technical assistance.
    Water resource management, community-based livestock and climate-
resilient agriculture systems are critical to ensure adaptability, 
improve agricultural productivity, and sustain water and land resources 
in Niger. The Compact will seek to raise rural incomes by increasing 
agricultural and livestock production by boosting production through 
increases in areas under cultivation and improvements in yields. 
Through the Compact, MCC will finance critical access to water for crop 
and livestock productivity, market

[[Page 52465]]

platforms, and transport infrastructure, while also building the 
technical capacity necessary to realize projected benefits and to 
sustainably utilize and maintain the infrastructure and natural 
resource investments.
    The budget for the Compact is $437,024,000, allocated as follows:

                         Compact Budget Summary
------------------------------------------------------------------------
                                                            Total  (in
                        Component                              US$)
------------------------------------------------------------------------
1. Irrigation and Market Access Project:
    1.1 Irrigation Perimeter Development................     113,250,000
    1.2 Management Services and Market Facilitation.....       9,142,000
    1.3 Roads for Market Access.........................     113,422,000
    1.4 Policy Reform...................................      18,750,000
                                                         ---------------
        Subtotal........................................     254,564,000
2. Climate-Resilient Communities Project:
    2.1 Regional Sahel Pastoralism Support..............      45,000,000
    2.2 Climate-Resilient Agriculture...................      51,500,000
                                                         ---------------
        Subtotal........................................      96,500,000
3. Monitoring and Evaluation:
    3.1 Monitoring and Evaluation.......................      12,000,000
                                                         ---------------
        Subtotal........................................      12,000,000
4. Program Administration and Oversight:
    4.1 MCA-Niger Administration, Program Management          73,960,000
     Support, Fiscal Agent, Procurement Agent and
     Financial Audits...................................
                                                         ---------------
        Subtotal........................................      73,960,000
                                                         ---------------
            Total Program Budget........................     437,024,000
------------------------------------------------------------------------

Irrigation and Market Access Project ($254.6 Million)

    The Irrigation and Market Access Project (``Irrigation Project'') 
aims to increase rural incomes through improvements in agricultural 
productivity and sales resulting from modernized irrigated agriculture 
and flood management systems with sufficient trade and market access. 
The project will focus its interventions in the Dosso and Tahoua 
regions. Specifically, the Irrigation Project will support the 
following activities:
    1. Irrigation Perimeter Development Activity. This activity is 
designed to rehabilitate the Konni irrigation system and develop new 
irrigated perimeters in the Dosso-Gaya area. The Konni rehabilitation 
will restore and secure reliable production capacity on approximately 
6,060 acres (2,452 hectares) of an existing large-scale irrigation 
infrastructure. New perimeters will be developed in Ouna-Kouanza and 
Sia. The rehabilitation component represents improvement on 19 percent 
of existing irrigation infrastructure in the country. The new 
perimeters will increase the area under irrigation in Niger by 20 
percent.
    2. Management Services and Market Facilitation Activity. This 
activity complements the Irrigation Perimeter Development Activity by 
increasing the productive assets for beneficiaries of the Irrigation 
Perimeter Development Activity through the following:
    i. Establishing and implementing a framework for land allocation, 
based on, among other things, (i) development of local land tenure 
profiles, (ii) participatory development of core local land allocation 
standards and of a transparent process for undertaking the land 
allocation, and (iii) completing the land allocation and formalizing 
land property rights, and building capacity for local land governance 
to address land conflict management and integrated local land use 
planning;
    ii. Establishing and empowering single-purpose, self-governing, 
self-financing nonprofit irrigation water user associations (IWUAs) to 
undertake irrigation management functions in the project intervention 
areas, including preparatory studies, technical support and capacity 
building for the newly formed IWUAs; and
    iii. Strengthening the capacity of beneficiaries through new or 
existing savings groups and existing producer and women's and youth 
groups to (i) grow commodities according to market demand and pricing 
signals, (ii) participate in savings groups to improve business skills 
and save capital to operationalize their cropping calendars, (iii) 
increase use of appropriate fertilizers and improved seeds, (iv) 
monitor and adapt to changing conditions in the environment, (v) 
participate in producer organizations to improve their negotiation 
position at the farm gate and in the marketplace, (vi) invest in 
infrastructure to store and add value to their production, and (vii) 
increase sales of commodities and processed products.
    3. Roads for Market Access Activity. MCC funding is intended to 
support improvements to physical market access through targeted road 
network improvements serving the Dosso-Gaya perimeters and linking 
irrigation beneficiaries to important consumer markets and regional 
trade hubs. This activity will support the rehabilitation and gravel 
upgrade of approximately 116 miles (187 kilometers (km)) of the RN35 
road directly serving the Dosso-Gaya perimeters; rehabilitation, 
upgrade and paving of approximately 51 miles (83 km) of the RN7, the 
main north-south international trunk road linking the southern region 
of Niger to the rest of the country; and rehabilitation and gravel 
upgrade of approximately 23 miles (37 km) of the Sambera rural road 
that links the Ouna-Kouanza and Sia irrigation perimeters with the RN7.
    4. Policy Reform Activity. This activity aims to promote several 
major policy reforms directly linked to the success and sustainability 
of the Compact through support (i) to develop and build the capacity of 
the Ministry of Hydraulics and Sanitation and other relevant government 
entities to implement a new master plan to manage national water 
resources, (ii) to develop and implement natural resource and community 
land use management plans

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for the protected areas and nearby communities affected by the 
Irrigation Project in the Dosso Region, (iii) to reform the Ministry of 
Agriculture and Livestock's fertilizer distribution system to allow 
greater competition and private sector participation to improve 
availability and affordability of fertilizers, especially to small 
farmers, and (iv) to develop the statistical capacities of the National 
Institute of Statistics and development of the Government of Niger's 
monitoring and evaluation capacities.

Climate-Resilient Communities Project ($96.5 Million)

    The Climate-Resilient Communities Project (``CRC Project'') aims to 
increase incomes for small-scale agriculture-dependent and livestock-
dependent families in eligible municipalities in rural Niger by 
improving crop and livestock productivity, sustaining natural resources 
critical to long-term productivity, and increasing market sales of 
targeted commodities. The project will be implemented in partnership 
with the World Bank through existing project implementation units 
(``PIUs'') located in the Ministry of Agriculture and Livestock. MCC 
funding will not be combined with World Bank funds, though the PIUs 
will oversee both MCC and World Bank-funded activities. The PIUs will 
use jointly agreed upon operation manuals that will incorporate 
investment criteria, legal, fiscal, procurement, environmental, social, 
gender and monitoring and evaluation requirements that comply with MCC 
standards. To ensure adequate oversight, the accountable entity for the 
Compact, the Millennium Challenge Account--Niger (``MCA-Niger''), will 
embed staff within these PIUs. Regions of intervention for this project 
are Tillaberi, Dosso, Tahoua and Maradi.
    1. Regional Sahel Pastoralism Support Activity (``PRAPS 
Activity''). The PRAPS Activity aims to improve livestock value and 
sales by conducting a livestock health and vaccination campaign; 
identifying and undertaking critical upgrades in major transhumance 
livestock corridors, including water points and pasture improvements; 
and modernizing local market infrastructure and organization.
    2. Climate-Resilient Agriculture Activity (``CRA Activity''). The 
CRA Activity aims to support the development and implementation of 
municipality-level investment plans to increase the use of agricultural 
practices that minimize climate risks, improve the utilization rate of 
fertilizer and improved/drought-tolerant seeds, increase access to 
small-scale irrigation, promote land reclamation, protect watersheds 
from erosion, and establish market platforms to competitively position 
farmer groups in the marketplace. MCC funds will focus on climate-
resilient investment needs, especially small-scale irrigation, in 16 
municipalities in four regions.
    The activity will include a grant facility that will competitively 
award grants to women's and youth groups, cooperative and producers' 
groups, and micro-, small-, and medium-sized enterprises. The portfolio 
of grants managed by the grant facility must meet MCC's economic rate 
of return (``ERR'') hurdle rate. Similarly, the municipality-level 
investment plans will be developed in the first year of Compact 
implementation, and must also meet MCC's ERR hurdle rate in order to be 
funded.

Economic Analysis

    The Compact will aim to address Niger's two major constraints to 
economic growth through a combination of policy reforms, infrastructure 
investments, access to training, finance and management services, 
facilitation of partnerships, and improvements to agricultural and 
livestock production and market platforms. These activities will enable 
farming, fishing and pastoral households in the intervention areas to 
increase their agricultural and livestock production and in turn, raise 
their incomes.
    An ERR was calculated for each of the Compact's projects. The ERR 
for the Irrigation Project is estimated at 17 percent. The CRC Project 
consists of activities to be developed in consultation with local 
communities and of activities funded through a competitive grant 
facility. This project (not including the $12.5 million matching grant 
facility subactivity) has an estimated ERR of 14 percent. Because the 
nature of specific grant proposals cannot be known until they are 
submitted for review, ERRs will be calculated during grant selection.
    On a limited basis, small-scale grants without a full ERR may be 
awarded if determining a full ERR is deemed to be cost prohibitive. In 
those cases, each proposal will still undergo a consideration of costs 
versus benefits to verify its viability. Economists can, for instance, 
determine the likelihood of a satisfactory rate of return based on 
looking at similar project profiles. The grant portfolio will have an 
ERR above MCC's hurdle rate of 10 percent.
    The Compact is expected to reach 489,359 households totaling more 
than 3.9 million beneficiaries over a twenty-year period.

[FR Doc. 2016-18756 Filed 8-5-16; 8:45 am]
 BILLING CODE 9211-03-P