Exploring Policy Alternatives to Excluding State Owned Enterprises (SOEs) From Millennium Challenge Corporation Funded Contracts in Africa

Abstract

Under the Millennium Challenge Act (MCA) the United States government (U.S.) provides eligible countries , with bilateral assistance to fund poverty alleviation programs and developmental projects through the Millennium Challenge Corporation (MCC). The MCA is a novel approach in U.S. bilateral assistance to developing countries. Even though the MCA does not supplant existing U.S. bilateral assistance programs, it deviates from programs typically implemented under the Foreign Assistance Act, 1961 (FAA) under which assistance is mainly given on compassionate grounds. In contrast, the MCA adopts an accountable and results oriented approach in the selection of eligible countries if they meet certain criteria in their commitment to governing justly, investing in their people and encouraging economic freedom.