— Misses out on another chance at US$500M grant funding
The administration of President George Weah has once again failed a chance to secure funding from the Millennium Challenge Corporation (MCC) program, with grant funding to the tune of US$500 million, after his government performed dismally.
This year's poor performance marks the fifth year in a row that the Weah administration has failed to make a pass on the MCC scorecard, denying the country the opportunity to secure a second compact that would have greatly funded the government’s national development roadmap — the Pro-Poor Agenda for Prosperity and Development.
Eligibility for the MCC funding is predicated upon a country passing at least 10 of the 20 indicators, as well as both the “hard hurdles” categories — the political rights or civil liberties indicator, and the control of corruption indicator.
The indicators are used by the MCC Board of Directors to assess country performance on MCC’s eligibility criteria. A country is considered to “pass” a given indicator if it performs better than the median score in its income group or the absolute threshold.
But the Weah administration, passing 9 out of 20 indicators for the fiscal year 2022 is a repeat of the country’s FY2021 score, in which the government also narrowly missed out on eligibility to be considered for another MCC compact. The MCC compact provides beneficiary countries time-bound grants targeted at ensuring economic growth, reducing poverty, and strengthening governmental institutions.
The failure adds to an unwelcome week for the President and his government image. It comes just a few days after seeing senior officials of his government slapped with sanctions by the US government for corrupt practices that undermine Liberia's fragile democracy.
The nine indicators in which the Liberian government made a pass include political rights, civil liberties, freedom of information, control of corruption, gender in the economy, land rights and access, health expenditures, access to credit, and business start-up.
The highest marks this time were earned in the “ruling justly” category (5 out of 6 indicators passed), followed by “economic freedom” (3 out of 8 indicators passed). Liberia performed poorly in the category of investing in people, passing in only 1 out of 6 indicators.
However, for categories that include the rule of law, government effectiveness, trade policy, regulatory quality, inflation, fiscal policy, natural resource, primary education expenditure, child health, and immunization rates — the government repeated last year’s dismal performance by failing in all of the same categories again.
If Weah had secured the MCC funding, it would have been the country’s second. The government of former President Ellen Johnson Sirleaf secured the compact funding of US$257 million to rebuild the country’s war-ravaged electricity utility.
But Liberia's journey started after the country was selected for threshold program eligibility in 2008. The then Liberian government created a steering committee composed of ministers and deputy ministers from relevant agencies. With strong support from Sirleaf, the ministers were instructed to focus on improving Liberia’s performance on the scorecard, according to the MCC.
While working with MCC, USAID, and the indicator institutions, the steering committee uncovered outdated tariff data in the trade policy indicator and missing data on the education indicators. The steering committee coordinated across the government to ensure the data was updated promptly. In 2012, Liberia passed the MCC scorecard for the first time and was selected by MCC’s Board of Directors to develop a proposal for a compact.
The compact under the Sirleaf Administration came into force on January 20, 2016, and ended at midnight on January 20, 2021.
Established in 2004, the MCC provides time-limited grants and assistance to countries that meet rigorous standards for good governance, fighting corruption, and respecting democratic rights. Its scorecards are a key component in its competitive selection process that determines which countries are eligible to develop a five-year grant agreement known as a compact.
Scorecards consist of a collection of 20 independent, third-party indicators that measure a country’s policy performance in the areas of economic freedom, ruling justly, and investing in people.