[Federal Register Volume 88, Number 243 (Wednesday, December 20, 2023)]
[Notices]
[Pages 88127-88129]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-28044]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 23-09]


Report on the Selection of Eligible Countries for Fiscal Year 
2024

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: This report is provided in accordance with the Millennium 
Challenge Act of 2003, as amended. The report is set forth in full 
below.

SUPPLEMENTARY INFORMATION: Report on the Selection of Eligible 
Countries for Fiscal Year 2024.

Summary

    This report is provided in accordance with section 608(d)(1) of the 
Millennium Challenge Act of 2003, as amended (the Act) (22 U.S.C. 
7707(d)(1)).
    The Act authorizes the provision of assistance under section 605 of 
the Act (22 U.S.C. 7704) to countries that enter into compacts with the 
United States to support policies and programs that advance the 
progress of such countries in achieving lasting poverty reduction 
through economic growth and are in furtherance of the Act. The Act 
requires the Millennium Challenge Corporation (MCC) to determine the 
countries that will be eligible to receive assistance for

[[Page 88128]]

the fiscal year, based on their demonstrated commitment to just and 
democratic governance, economic freedom, and investing in their people, 
as well as on the opportunity to reduce poverty through economic growth 
in the country. The Act also requires the submission of reports to 
appropriate congressional committees and the publication of notices in 
the Federal Register that identify, among other things:
    1. The countries that are ``candidate countries'' for assistance 
for fiscal year (FY) 2024 based on their per-capita income levels and 
their eligibility to receive assistance under U.S. law, and countries 
that would be candidate countries, but for specified legal prohibitions 
on assistance (section 608(a) of the Act (22 U.S.C. 7707(a)));
    2. The criteria and methodology that the Board of Directors of MCC 
(the Board) used to measure and evaluate the policy performance of the 
``candidate countries'' consistent with the requirements of section 607 
of the Act in order to determine ``eligible countries'' from among the 
``candidate countries'' (section 608(b) of the Act (22 U.S.C. 
7707(b))); and
    3. The list of countries determined by the Board to be ``eligible 
countries'' for FY 2024, with justification for eligibility 
determination and selection for compact negotiation, including with 
which of the eligible countries the Board will seek to enter into 
compacts (section 608(d) of the Act (22 U.S.C. 7707(d))).
    This is the third of the above-described reports by MCC for FY 
2024. It identifies countries determined by the Board to be eligible 
under section 607 of the Act (22 U.S.C. 7706) for FY 2024 with which 
MCC seeks to enter into compacts under section 609 of the Act (22 
U.S.C. 7708), as well as the justification for such decisions. The 
report also identifies countries selected by the Board to receive 
assistance under MCC's threshold program pursuant to section 616 of the 
Act (22 U.S.C. 7715).

Eligible Countries

    The Board met on December 13, 2023, to select those eligible 
countries with which the United States, through MCC, will seek to enter 
into a Millennium Challenge Compact pursuant to section 607 of the Act 
(22 U.S.C. 7706). The Board selected the following eligible country for 
such assistance for FY 2024: Cabo Verde. Cabo Verde is invited by MCC 
to develop a compact for the purposes of regional economic integration. 
The Board also selected the following previously selected countries for 
compact assistance for FY 2024: C[ocirc]te d'Ivoire, Senegal, Sierra 
Leone, The Gambia, Togo, and Zambia.

Criteria

    In accordance with the Act and with the ``Report on the Criteria 
and Methodology for Determining the Eligibility of Candidate Countries 
for Millennium Challenge Account Assistance in Fiscal Year 2024'' 
formally submitted to Congress on September 13, 2023, selection was 
based primarily on a country's overall performance in three broad 
policy categories: Ruling Justly, Encouraging Economic Freedom, and 
Investing in People. The Board relied, to the fullest extent possible, 
upon transparent and independent indicators to assess countries' policy 
performance and demonstrated commitment in these three broad policy 
areas. The Board compared countries' performance on the indicators 
relative to their income-level peers, evaluating them in comparison to 
either the group of countries with a GNI per capita equal to or less 
than $2,145, or the group with a GNI per capita between $2,146 and 
$4,465.
    The criteria and methodology used to assess countries, including 
the methodology for the annual scorecards, are outlined in the ``Report 
on the Criteria and Methodology for Determining the Eligibility of 
Candidate Countries for Millennium Challenge Account Assistance for 
Fiscal Year 2024.'' \1\ Scorecards reflecting each country's 
performance on the indicators are available on MCC's website at https://www.mcc.gov/who-we-select/scorecards.
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    \1\ Available at https://www.mcc.gov/resources/doc/report-selection-criteria-methodology-fy24.
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    The Board also considered whether any adjustments should be made 
for data gaps, data lags, or recent events since the indicators were 
published, as well as strengths or weaknesses in particular indicators. 
Where appropriate, the Board considered additional quantitative and 
qualitative information, such as evidence of a country's commitment to 
fighting corruption, investments in human development outcomes, or 
poverty rates. MCC published a Guide to Supplemental Information \2\ to 
increase transparency about the type of supplemental information the 
Board uses to assess a country's policy performance. MCC also published 
web pages \3\ regarding how MCC assesses performance on the new 
Education Expenditures and Girls' Lower Secondary Education Completion 
Rate scorecard indicators. In keeping with statutory requirements, the 
Board also considered the opportunity to reduce poverty and promote 
economic growth in a country, in light of the overall information 
available, as well as the availability of appropriated funds.
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    \2\ Available at https://www.mcc.gov/resources/doc/guide-to-supplemental-information.
    \3\ Available at https://www.mcc.gov/who-we-select/indicator/education-expenditure-indicator (Education Expenditures), https://www.mcc.gov/who-we-select/indicator/girls-lower-secondary-education-completion-rate-indicator (Girls' Lower Secondary Education 
Completion Rate) and https://www.mcc.gov/blog/entry/blog-101723-mcc-girls-education (both indicators).
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    The Board sees the selection decision as an annual opportunity to 
determine where MCC funds can be most effectively used to support 
poverty reduction through economic growth in well-governed countries 
with demonstrated development need. The Board carefully considers the 
appropriate nature of each country partnership--on a case-by-case 
basis--based on factors related to poverty reduction through economic 
growth, the sustainability of MCC's investments, and the country's 
ability to attract and leverage public and private resources in support 
of development.
    This was the sixth year the Board considered the eligibility of 
countries for concurrent compacts, as permitted under section 609(k) of 
the Act. In addition to the considerations for compact eligibility 
detailed above, the Board considered whether a country being considered 
for a concurrent compact is making considerable and demonstrable 
progress in implementing the terms of its existing compact.
    This was the fifteenth year the Board considered the eligibility of 
countries for subsequent compacts, as permitted under section 609(l) of 
the Act. MCC's engagement with partner countries is not open-ended, and 
the Board is deliberate when selecting countries for follow-on 
partnerships, particularly regarding the higher bar applicable to 
subsequent compact countries. The Board considered--in addition to the 
criteria outlined above--a country's performance implementing its prior 
compact, including the nature of the country's partnership with MCC, 
the degree to which the country has demonstrated a commitment and 
capacity to achieve program results, and the degree to which the 
country implemented the compact in accordance with MCC's core policies 
and standards. To the greatest extent possible, these factors are 
assessed using pre-existing monitoring and evaluation targets and 
regular quarterly reporting. This information is supplemented with 
direct surveys and consultation with MCC staff

[[Page 88129]]

responsible for compact implementation, monitoring, and evaluation. MCC 
published a Guide to the Program Surveys \4\ regarding the information 
collected and assessed for any country with an existing or prior 
compact or threshold program to ensure transparency about the type of 
information the Board considers regarding a country's performance on 
MCC programs, as relevant. The Board also considered a country's 
commitment to further sector reform, as well as evidence of improved 
scorecard policy performance.
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    \4\ Available at https://www.mcc.gov/resources/doc/guide-to-program-surveys-fy23.
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    In addition, this is the eighth year in which the Board considered 
an explicitly higher bar for countries close to the upper end of the 
candidate pool. The Board looked closely--in such cases--at a country's 
access to development financing, the nature of poverty in the country, 
and its policy performance.
Countries Newly Selected for Compact Assistance
    Using the criteria described above, one candidate country under 
section 606(a) of the Act (22 U.S.C. 7705(a) was newly selected as 
eligible for assistance under section 607 of the Act (22 U.S.C. 7706): 
Cabo Verde. Cabo Verde is invited by MCC to develop a compact for the 
purposes of regional economic integration.
    Cabo Verde: Cabo Verde has consistently passed the scorecard for 
over a decade and has some of the highest Control of Corruption and 
Democratic Rights scores of any MCC partner. The government was a 
committed partner during its prior MCC programs and has consistently 
expressed deep interest in renewing its partnership with MCC. While 
Cabo Verde has made strides in reducing poverty, recent progress has 
been hampered by global events and external shocks. MCC's Board 
selected Cabo Verde for a regional compact as a result of its strong 
commitment to democracy, its economic development needs and lingering 
poverty, and the potential opportunities to strengthen regional 
economic integration and trade in West Africa with a committed and 
engaged former MCC partner.
Countries Selected To Continue Compact Development
    Six of the countries selected as eligible for compact assistance 
for FY 2024 were previously selected for FY 2023. C[ocirc]te d'Ivoire 
(regional), Senegal (regional), Sierra Leone, The Gambia, Togo, and 
Zambia were selected to continue developing compacts. Selection of 
these countries for FY 2024 was based on an assessment of their policy 
performance since their prior selection and their progress in 
developing programs with MCC.
Countries Selected To Receive Threshold Program Assistance
    The Board selected Tanzania and the Philippines to receive 
threshold program assistance for FY 2024, leveraging MCC's new 
authority to pursue threshold programs after compacts for countries 
that have experienced set-backs, but are now on a positive governance 
trajectory.
    Tanzania: A former MCC compact partner, Tanzania offers MCC the 
opportunity to engage with a country that faces significant challenges 
to economic growth and that is demonstrating a trajectory of reform. 
While Tanzania does not pass the MCC scorecard in FY 2024 due to not 
passing the Democratic Rights ``hard hurdle,'' it passes the Control of 
Corruption ``hard hurdle,'' and passes 15 of 20 indicators overall. 
Since taking office in 2021, President Hassan has taken some steps to 
strengthen democratic governance, including restoring some media 
freedoms and political rights for opposition groups and initiating a 
process to identify other key democratic and constitutional reforms. By 
selecting Tanzania for a threshold program, MCC will work with the 
government to undertake policy and institutional reforms to address the 
country's development needs while also encouraging further democratic 
progress and the advancement of human rights.
    Philippines: A former MCC compact partner, the Philippines passes 
11 of 20 indicators on the MCC scorecard in FY 2024, including both 
Democratic Rights indicators, but does not pass the scorecard because 
it fails the Control of Corruption indicator in the 50th percentile 
(countries must score above the 50th percentile to pass). President 
Ferdinand Marcos Jr., elected in May 2022, has committed to advancing 
critical reforms, pledged to increase transparency, and strengthened 
judicial independence and the prosecution of human rights violations. 
By selecting the Philippines for a threshold program, MCC can support 
the government to undertake policy and institutional reforms to address 
the country's development needs while also encouraging further progress 
on advancing labor and human rights and combatting corruption.
Country Selected To Continue Developing a Threshold Program
    The Board selected Mauritania to continue developing a threshold 
program. Selection of Mauritania for FY 2024 was based on its continued 
commitment to strengthening its policy performance since its prior 
selection, particularly in its fight against trafficking in persons and 
hereditary slavery, and its progress toward developing its threshold 
program.

Ongoing Review of Partner Countries' Policy Performance

    The Board emphasized the need for all partner countries to maintain 
or improve their policy performance. If it is determined during compact 
implementation that a country has demonstrated a significant policy 
reversal, MCC can hold it accountable by applying MCC's Suspension and 
Termination Policy.\5\
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    \5\ Available at https://www.mcc.gov/who-we-select/suspension-or-termination.

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(Authority: 22 U.S.C. 7707(d)(2))

    Dated: December 15, 2023.
Peter E. Jaffe,
Vice President, General Counsel, and Corporate Secretary.
[FR Doc. 2023-28044 Filed 12-18-23; 8:45 am]
BILLING CODE 9211-03-P