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CGD has helped shape the Millennium Challenge Corporation through years of analysis dating back to the creation of its financing mechanism—the Millennium Challenge Account—by President Bush in 2002. Our research has helped guide MCC’s work to reduce poverty through growth and we remain at the forefront of creative thought for how to improve this important lever of US foreign assistance.
This week, Congress passed the African Growth and Opportunity Act and Millennium Challenge Act Modernization Act (H.R. 3445). Once signed, it will give MCC the long-awaited authority needed to pursue regional programming more effectively.
After over a year without top political leadership, MCC may soon have a new CEO. Sean Cairncross, the Trump administration’s nominee to take the helm of the agency, has his Senate hearing tomorrow—where we’ll get an early look at his vision for MCC.
One of the biggest questions donors grapple with is how to balance implementing specific projects with building local capacity to execute similar programming in the future. Indeed, this question is central to the conversation—now active at USAID—about how donors can “work themselves out of a job.” One good example of how this can look comes from the Millennium Challenge Corporation’s (MCC) 2005-2010 partnership with Honduras. In this story, a key part of MCC’s legacy is not about what the agency funded but how it funded it.
This week, MCC edged one step closer to securing new authorities that would better position the agency to undertake regional programming. Similar provisions were included in fully five bills in the 114th Congress, but none made it over the finish line. Hopefully 2018 will be the year.
Every December, MCC’s board of directors meets to select the set of countries eligible for MCC’s compact or threshold programs. And each year, before the board meeting, CGD’s US Development Policy Initiative publishes a discussion of the overarching issues expected to impact the decisions alongside its predictions for which countries will be selected. Here’s what to watch for at the upcoming MCC board meeting on December 19.
Next month, the Millennium Challenge Corporation’s board of directors will meet to select the set of countries that will be eligible for the agency’s large-scale grant programs. One of the decisions on the table will be whether to continue the partnership with the Philippines. Over the last year and a half, questions have emerged about whether the Philippines continues to meet MCC’s good governance criteria. In one month, MCC and its board will have to answer those lingering questions.
Domestic revenue mobilization (DRM) seems set to be a priority area for the US Agency for International Development (USAID) under Administrator Mark Green. The challenge has been in tracking US (and other donors’) support for DRM activities. While the data only covers projects in 2015 so far, it contributes to a better understanding of what US aid agencies are doing in the DRM space and where they are working. If the United States is looking to step up assistance in this area, it will be instructive to understand the landscape of current efforts.
The very same week that USAID and the Department of State submitted a joint redesign plan to the Office of Management and Budget, the coauthors of four recent reform proposals packed the CGD stage for a timely debate. Fragmentation, inclusive economic growth, humanitarian assistance and fragile states, global health, and country graduation were a few of the big questions that panel members grappled with as they authored their reports.
CGD and the Brookings Institution recently released the third edition of the Quality of Official Development Assistance (QuODA), a joint venture that measures donor performance across a series of aid quality indicators to encourage governments, institutions, and agencies to disburse more effective, transparent, and efficient assistance.
When MCC was founded, there was widespread skepticism about the effectiveness of foreign assistance. Many observers, both external and internal to development institutions, agreed that too much aid was being spent on poor projects in service of poorly defined objectives with correspondingly little understanding of what these funds were achieving.
The Millennium Challenge Corporation (MCC) was established to provide large-scale grant funding to poor, well-governed countries to support their efforts to reduce poverty and generate economic growth. However, the statutory definition of which countries are “poor” for the purposes of MCC candidacy is inadequate. Based solely on GNI per capita with a rigid graduation threshold, it does not portray a clear picture of broad-based well-being in a country. Using a new, comprehensive country-level dataset of median consumption/income, the authors explore the merits and limitations of such a measure and suggest how it might be applied as an additional determinant of MCC candidacy.