Remarks by MCC CEO Ambassador John Danilovich at the Signing Ceremony of the Mozambique Compact

Good morning.

• Your Excellency President Guebuza,
• Deputy Secretary of State Negroponte,
• Congressman Payne, Chairman of the Africa Subcommittee, thank you for coming today,
• Minister Cuereneia, Minister Zacarias, and members of the delegation from Mozambique,
•  Under Secretary Jeffery, the State Department’s new Under Secretary for Economy, Energy, and Agriculture,
• Ambassador Panguene and distinguished ambassadors,
• MCC Board Member Alan Patricof,
• Former Congressman Jim Kolbe,  
• Friends of Mozambique,

Today we gather to witness and celebrate the signing of an almost $507 million Compact between the Republic of Mozambique and the Millennium Challenge Corporation.

MCC’s Compact with Mozambique is our sixth in Africa—and our 12th overall. 

And, I really do think this is something to celebrate with our great friends from Mozambique.  It is a tremendous achievement.   

I commend the incredible efforts of the Mozambique and MCC teams—led respectively by Emilio Muchanga and Stephen Gaull—who have worked with diligence and determination to reach this Compact.

As a new and innovative approach to development assistance, the Millennium Challenge Corporation is committed to helping countries help themselves overcome barriers to poverty reduction and economic growth.   We are fulfilling the mandate given to us by the U.S.  Congress when they created MCC in 2004.   And, only with Congress’s support for sufficient funding will MCC be able to continue to fulfill our mission throughout the world.

MCC is a bilateral, American program—our grants are rewards for countries that are doing the right things for the right reasons.  MCC rewards

• good government,
• good governance,
• countries that invest in their people,
• and provide economic freedom

—all of this being the foundation upon which we can build programs for the reduction of poverty and sustained economic growth and create stability and security.

MCC’s mission is grounded in partnership, partnerships with countries

• willing to undertake the often difficult work of political, economic, and social policy reforms,

• willing to build their capacity to lead their own sustainable development,

• and willing to deliver results where they matter most—in the lives of the poor.

It is important to pause and think about this for a moment.

Mozambique and all of our MCC partner countries have made a tremendous effort to become eligible for MCC funding—and to persevere with those efforts to remain eligible.
Mozambique is an outstanding example of how our MCC model and how our incentive effect are working—working in Mozambique, working in Africa, and working throughout the world.

Mozambique has undergone a remarkable transformation, embracing electoral and economic reforms to sustain peace and development.  The Compact we sign today is part of Mozambique’s own reform agenda and contributes to the country’s ongoing transformation that continues to create opportunities for the poorest Mozambicans.  
The Mozambique-MCC Compact aims to reduce poverty where it is most heavily concentrated:  in the Northern districts of

• Cabo Delgado,
• Nampula,
• Niassa,
• and Zambezia.  

The Compact will have a direct impact on the men, women, and children of Mozambique and focuses on

• water and sanitation,
• roads,
• land tenure,
• and expanding opportunities for farmers.

Let me briefly explain each component of the Compact.

The first component allocates more than $200 million to improve access to safe and reliable water and sanitation in eight cities and towns, and 600 rural villages.  Mozambique suffers from one of the world’s lowest levels of per-capita water consumption, and Mozambican girls and women spend much of their day fetching water, rather than attending school or engaging in income-generating activities.

This program will increase water supply and sanitation services, which will expand productivity and reduce water-borne diseases. 

The second component directs $176 million to rehabilitating the backbone of Mozambique’s national transportation network. It will improve linkages between the northern region and the country’s southern half, which has been driving Mozambique’s economic growth. 

The third component targets almost $40 million to reduce the

• time,
• cost,
• and risks

associated with gaining access to land. Ultimately, this will create a climate more conducive to investment and business development, as well as increased asset values.

And, the fourth and final component provides more than $17 million to prevent the collapse of the coconut industry and encourage new growth opportunities in agriculture for almost 2 million Mozambicans.  Urgent measures are needed to contain the spread of the Coconut Lethal Yellowing Disease,  which threatens their industry, and to help farmers improve agricultural practices and diversify into other cash crops.

Together, these four programs will

• create jobs,
• increase productivity,
• and improve the investment climate in the northern provinces. 

Growth and job creation are effective antidotes to poverty.  Through strategic investments in areas identified by Mozambicans themselves, this plan will generate the results that both Mozambican citizens and American taxpayers expect from development assistance. 

President Guebuza, we recognize the farsighted vision and firm resolve with which you and your government are leading Mozambicans.  Your commitment to the reforms that replace poverty with the opportunities of growth and development will improve the lives of Mozambicans now and for generations to come.

My colleagues and I at the Millennium Challenge Cooperation are proud and honored to be engaged in this partnership with you to reduce poverty and sustain economic growth in  Mozambique.

It is now my distinct pleasure to invite Deputy Secretary of State John Negroponte to come to the podium…