Armenia Eligible for Millennium Challenge Account Funding

Secretary Powell Announces List of 16 Countries Invited to Submit Proposals for Multi-Billion Dollar Aid Program

WASHINGTON–DC–The State Department announced that Armenia has been chosen to be among a select group of 16 countries eligible for Millennium Challenge Account funding–a new multi-billion dollar US program designed to provide assistance to low-income countries that demonstrate a strong commitment toward good governance and economic growth and reform–reported the Armenian National Committee of America (ANCA.)

"We welcome the State Department’s decision to include Armenia in the first tier of countries to participate in the MCA," said ANCA Chairman Ken Hachikian. "The funds will create important opportunities for strengthening the Armenian economy and helping the Armenian people overcome the ongoing–multi-billion dollar impact of the dual Turkish and Azerbaijani blockades. We look forward to working with Armenian Government officials and the Millennium Challenge Corporation to assist in the funding process ahead."

The complete list of 16 countries eligible to apply for MCA funds includes: Armenia–Benin–Bolivia–Cape Verde–Georgia–Ghana–Honduras–Lesotho–Madagascar–Mali–Mongolia–Mozambique–Nicaragua–Senegal–Sri Lanka–and Vanuatu.

President Bush first announced his intent to create the MCA in March–2002. The program is based on the premise that economic development succeeds best where it is linked to free market economic and democratic principles and policies. Eligibility under this program–which is only open to selected low-income countries–is conditioned on sound policy performance and accountability by recipient nations. This performance in measured by sixteen quantifiable criteria in the areas of ruling justly–investing in people–and economic freedom.

Overall funding for MCA will be $1 billion for Fiscal Year 2004–and is expected to increase to $5 billion by Fiscal Year 2006. Although there are no guaranties that its grant proposals will be funded–Armenia’s annual share from this new foreign aid program could be as much as $75 million a year.

Secretary of State Colin Powell–who serves as chairman of the Millennium Challenge Corporation (MCC)–developed to oversee the implementation of the Millenium Challenge Account funds–stated–"This is a historic day for the Millennium Challenge Corporation. The President’s vision has come to pass–and today’s decision by the Board of Directors is a major step in implementing the vision of the MCC."

An ANCA study prepared in September of 2003 showed that Armenia was well-positioned to receive MCA funding based on the 16 criteria set out by the MCC. The study was distributed widely to Members of Congress and the Administration as well as to representatives of the Armenian Government. In the months that followed–the ANCA tracked Congressional hearings dealing with MCA–where Members of Congress including Rep. Adam Schiff (D-CA)–Brad Sherman (D-CA) and Joseph Crowley (D-NY)–spoke in support of Armenia’s participation in the program and questioned early assertions that Armenia may not receive first tier funding.

Upon learning of the MCC announcement–Rep. Schiff stated–"I am delighted to see that Armenia is included in the first group of nations eligible to receive funding under the Millennium Challenge Account. As a struggling democracy that is economically isolated by an injurious blockade–Armenia is a prime candidate for MCA assistance. This is welcome news for Armenia and a good judgment by the MCA Board and State Department."

MCA eligibility was among a series of topics brought up in high level meetings between Armenian Government officials and an ANCA delegation including Chairman Ken Hachikian–held in conjunction with an Armenian Foreign Ministry Armenian Advocacy conference–held in Yerevan on May 3 and 4. The ANCA provided specific recommendations about the development of grant submissions to the MCA to ensure that Armenia–if selected–would receive a significant share of the first year MCA awards.

According to the MCA Website (www.mca.gov)–eligible countries will work with the MCC to develop a compact proposal for "achieving sustainable economic growth and poverty reduction." Successful proposals would be designed to:

–Engage a broad array of its society in coming up with its development priorities;

–Identify the measurable objectives that it wants to achieve;

–Include a plan for achieving those objectives with targets to assess progress;

–Develop transparent mechanisms to measure and evaluate whether targets are being met and to ensure financial accountability; and

–Provide a plan for sustaining progress after the MCA compact ends.

The extent to which a country’s proposal meets the above requiremen’s will help determine whether and how much the MCC will invest in the country.

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