Accepting this grant is Nepal’s choice but the availability of MCC funding is not open-ended: US

Published On: June 29, 2020 09:05 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, June 29: As the parliamentary endorsement of the Millennium Challenge Corporation (MCC) Compact is delayed further, the United States government has clarified that it cannot indefinitely wait for Nepal to take final decision on the 500 million grants.

The US Embassy in Kathmandu on Monday also said it is Nepal’s choice whether to accept the grant. “Accepting this grant is Nepal’s choice but the availability of the funding is not open-ended.  Tangible, near-term steps in Nepal are necessary to ensure the continued viability of the program,” said a press statement issued by the Embassy.

The statement comes in the wake of a section of politicians and others making speculation that the US was exerting pressure on Nepal to accept the grant. The endorsement of the MCC Compact through the parliament has lately fallen uncertain as rival factions within the ruling Nepal Communist Party (NCP) stand opposed to it.

The US embassy in the statement has clarified that the projects under the MCC grants cannot be expedited unless Nepal endorses the compact agreement through the parliament. “Ratification is the next step needed to proceed with the $500M grant, which the two countries signed in September 2017 and which Nepal committed to ratify by September 2019,” said the statement. 

The Embassy reminded that the Nepal government and the MCC worked together continuously since 2012 under multiple governments, representing all major political parties, to develop the compact program.  “This compact will build electric transmission infrastructure and perform road maintenance activities and directly benefit 23 million Nepalis,” the statement further said. 

The Nepali-led projects funded by the MCC compact seek to support poverty reduction through the country’s economic growth. While stating that delaying ratification is delaying the benefits of more jobs and increased economic growth for nearly 23 million Nepalis, the embassy further clarified that there is absolutely nothing as speculated by section of politicians and others in the MCC agreement.

The statement also brushed aside speculations made by a section of people in Nepal that MCC has a hidden agenda. “MCC’s transparency as a development partner is also recognized globally, and this year MCC was once again ranked as the top bilateral donor in the Aid Transparency Index,” the statement said.

The statement further said that the MCC is a committed partner having successfully partnered with nearly 30 countries worldwide on 37 grant agreements of several hundred million dollars, totaling $13 billion. “These grants have helped lift millions of people from poverty by catalyzing investment and economic growth and have supported partner countries’ sovereignty.  Every country eligible for a second grant has requested one,” the statement further said.


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