MUTHARIKA: We will work with extra passion to qualify for Second MCC Compact

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President Peter Mutharika says Malawi is committed to working with extra passion to qualify for the Second Compact under the Millennium Challenge Coorporation  (MCC), a US government agency which gave Malawi $350 million in the First Compact to upgrade its power infrastructure and energy.

President Mutharika posing with MCC and Malawi Governent  top officials President Mutharika posing with MCC and Malawi Governent top officials

Mutharika made the remarks on Thursday at Sanjika Palace when he had an audience with the Chief Executive Officer for Millennium Challenge Corporation (MCC), Sean Cairncross and his delegation.


Malawi was selected by the board of MCC directors  to be considered for the Second Compact. The cost of the Second Compact has not been disclosed.


For the country to qualify for the Second Compact which might take three years,  it must demonstrate continued commitment to good governance, maintain sound policies and invest in its people and pass the MCC scorebaord.


“We are aware that there is a demanding process that we need to go through and we will go all the way.

“We will work with MCC in the process of developing constraints analysis report so that we determine the actual factors that remain to constrain our economic growth,” said Mutharika.

Mutharika said that he is aware that the country needs more work on improving the country's macroeconomic environment with a strong imprint of private sector participation and difficulties with access to land for investments that affect participation of rural smallholder citizens particularly women.

“Further, we are aware that we have to work on reducing the cost of production such as high prices that result from the cost of poor rural roads and road freight transport services.

“Let me emphasize that we will improve lives of many Malawians the moment we bring down the cost of production in the country. “Our goal is not just economic growth but inclusive economic growth where rural people participate and benefit in our economic growth,” he added.

The president further said that the reduction of production cost will boost production, allow rural Malawians to participate more in the production, create more jobs and more products.

“This is the turning point for Malawi to stop being a consuming and importing nation to becoming a producing and exporting nation. This is Malawi's vision,” said Mutharika.

Cairncross said Malawi was selected for the second compact as a result of governments continued commitment to strengthening democratic institutions, maintaining sound economic policies and investing in its people.

“The selection demonstrates the faith that our Board of Directors and USA has on Malawi and the hard work the country is doing and we expect that progress to continue for the second compact to be a success,” said Cairncross.

He said for Malawi to be selected, it meant it had shown "tremendous progress on our indicators which measure governance, economic stability and investment in the government for its people. So we expect those indicators to continue."


The CEO said MCC had already approved  the findings of the preliminary economic constraints to growth analysis, which was conducted by MCC economists and government in the Second Compact, which identifies potential areas of investment.  


Millenium Development Trust CEO Dye Mawindo said the current political impasse does not pose any threat to the Compact's eligibility criteria , saying the reaction from Government was good. "The Second Compact has higher expectations and that Government is required to contribute 7.5 percent of the total negotiated compact value to show commitment to the programme."


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