Ambassador Rebecca E. Gonzales and the Minister of Finance Dr. Moeketsi Majoro announced the Millennium Challenge Corporation (MCC) Compact Development Grant Agreement worth $5.78 million marking a critical milestone in the development of a second compact with the Lesotho Government.
The Compact Development Grant Agreement makes funds available to the Government of Lesotho to develop a Compact, or a development program, designed to reduce poverty and spur economic growth. Under the terms of this Agreement, the Government of Lesotho will use the funds to undertake feasibility studies and other activities related to compact development process. During the event, the U.S. Ambassador highlighted the importance of remaining committed to the process of national reforms and to increasing accountability across sectors, as the process enters the new development and facilitation phase.
Ambassador Gonzales noted during the ceremony, “It is vital to understand that we still have a lot of hard work to do before we actually sign a compact between Lesotho and the United States. There is still potential for delay or derailment if we do not continue purposefully on the path of reforms and political stability…. [T]he United States counts on the sustained commitment of the Government of Lesotho to ensure that the resources we put in place today will develop an MCC compact that will truly reduce poverty and grow the economy for all benefit of all Basotho.”
In its first compact with Lesotho, completed in 2013, MCC invested $362.5 million to increase economic growth and reduce poverty by improving water supply, increasing access to essential health services, and removing barriers to private sector investment. The compact resulted in over 140 rehabilitated clinics and outpatient departments; 2,300 household water connections and construction of Metolong Water Treatment Plant; and independent or joint land titles for over 17,000 women.
The second compact will work towards those same goals through improved planning and delivery of public goods and services to enable private investment. The Government of Lesotho has contributed $500,000 in funds towards compact development to date.
Created by the U.S. Congress in January 2004 with strong bipartisan support, the Millennium Challenge Corporation (MCC) is a U.S. Government agency that provides 5 year grants and assistance to select countries that meet rigorous standards for good governance, from fighting corruption and respecting democratic rights to investing in health and education. MCC’s mission is to reduce global poverty through economic growth.