Malawi initiates compact dialogue

The Malawi Government, through the Malawi Millennium Development Trust (MMDT), formerly Millennium Challenge Account Malawi (MCA-M), has initiated consultations with various stakeholders to validate findings of the constraints analysis on the development of a second compact, it has been learnt.

The Constraints Analysis Review and Validation workshops follow the first stage of the development of a new compact, which started in March this year, with a constraints analysis process to identify key binding constraints to Malawi’s sustainable long-term economic growth.

A aerial view of Nkhoma power sub-station built with funding from MCC

During the constraints analysis process, three rounds of Millennium Challenge Corporation (MCC) missions to Malawi were undertaken to meet key stakeholders and collect information for data analysis that would lead to an informed decision on what the second compact should focus on.

MMDT public outreach and stakeholder engagement specialist Janet Chidothi, yesterday confirmed that they have, so far, met stakeholders in Lilongwe and Blantyre and they plan to hold another meeting in Mzuzu early next month.

She said the meetings seek to give stakeholders an opportunity to appreciate the MCC compact development process that focuses on country ownership, country-led design and a focus on results.

Said Chidothi: “The constraints discussed during the mission include macroeconomic volatility, rural transport and land access. A final decision will be made in late July.”

US Embassy public affairs officer Douglas Johnston, in an e-mail response yesterday, said MCC has sent its Malawian country director from Washington to Lilongwe between June 10 and 20 to finalise work with the Malawi Government on the constraints to economic growth analysis.

“The focus of the new compact investment will be determined based on the analysis. Compact development can take two to  three years,” he said.

Johnston said Malawi was selected for the second compact for meeting eligibility criteria which included successful implementation of the first compact, improved scorecard policy performance and a commitment to further sector reforms.

On December 11 2018, MCC, a US government foreign aid agency, selected Malawi as an eligible country to develop a second compact based on Malawi’s successful implementation of the first compact which focused on modernising power distribution, transmission and generation infrastructure.

Malawi was the only country in Africa to become eligible for the development of a second compact during this selection round.

The second compact follows a successful implementation of the first energy compact valued at $350.7 million (about K260 billion), which  was signed on April 7 2011 and ended on September 20 2018.

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