The United States and Tanzania Sign $698 Million Poverty Reduction Grant

Largest Grant to Date Addresses Transportation, Energy, and Water Needs

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Washington, D.C.— Yesterday, President Bush and Tanzanian President Kikwete signed a $698 million Millennium Challenge grant in a ceremony in Dar es Salaam, Tanzania. MCC’s largest compact to date, the program will reduce poverty by increasing household incomes through investments in transportation, energy, and water.

“We have signed the Millennium Challenge Compact, the largest ever. This funding will go a long way towards addressing some of our critical infrastructure challenges, which have for a long time been an obstacle to our growth and development. We very much thank you, Mr. President. We thank the U.S. government for agreeing with us to give the infrastructure sector the priority it deserves,” said President Kikwete.

The Millennium Challenge grant will help Tanzanians address critical transportation network needs by improving roads that will increase commerce and help connect communities with markets, schools, and health clinics. Additionally, the program will improve the reliability and quality of electric power and extend electricity service to communities not currently served—a vital commodity for rural villages and businesses to thrive. Finally the water project will increase the availability and reliability of potable water for domestic and commercial use which will increase the health and productivity of Tanzanians by reducing the incidence of water-related disease, particularly among children.

President Kikwete added, “Your decision that this Compact should be signed here in Dar es Salaam speaks volumes about how deep you have Tanzania in your heart. We are also grateful to the United States Congress for accepting your administration's request to fund the Tanzanian Compact package. We also thank the MCC board and the very able leadership of Secretary Rice. We appreciate the tremendous efforts of Ambassador Danilovich and his staff in making this day possible. And with the signing of the MCA compact, you are making it possible for the people of Tanzania to chart a brighter future, underpinned by growth, opportunity and democracy. We owe it to you, and owe it to the American people, that this compact meet its objectives and becomes a source of pride and satisfaction for our two governments and peoples.”

During the signing ceremony in Dar es Salaam, President Bush commented, “My hope is the MCC initiative will be part of an effort to transform parts of this country to become more hopeful places. We join you in this because of your government and your personal commitment to fight corruption, to invest in the education and health of your people, and to accept and expand marketplace economics.”

“MCC congratulates the people of Tanzania for developing a comprehensive program designed to build a better future for themselves and their children,” said MCC CEO Ambassador John Danilovich. “Tanzania is a valued partner in the fight to reduce poverty and MCC looks forward to building on this dynamic partnership throughout implementation of the compact.”

Since its inception in 2004, MCC has signed Compacts totaling over $5.5 billion with 16 partner countries around the world including: Madagascar, Cape Verde, Honduras, Nicaragua, Georgia, Armenia, Vanuatu, Benin, Ghana, Mali, El Salvador, Mozambique, Lesotho, Morocco, Mongolia, and Tanzania.

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Millennium Challenge Corporation (MCC), a United States government corporation designed to work with some of the poorest countries in the world, is based on the principle that aid is most effective when it reinforces good governance, economic freedom, and investments in people that promote economic growth and elimination of extreme poverty. For more information regarding the MCC’s innovative work to help countries reduce poverty through growth, visit www.mcc.gov.