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By Lael Brainard, Carol L. Graham, Nigel Purvis, Steven Radelet, Gayle E. Smith

In March 2002, President Bush introduced the production of the Millennium problem Account (MCA), a bilateral improvement fund representing a rise of $5 billion consistent with yr over present assistance degrees, to advertise progress in reform-oriented constructing international locations. This booklet considers the potential for the MCA in addition to the bigger content material people international assistance within which the MCA needs to locate its position. whereas the MCA might create incentives for governments to enhance monetary regulations and governance, and increase funding climates, it can additionally upload to the confusion of overlapping international suggestions companies. The authors urge the management to obviously outline the MCA's function and to deal with the power tensions among overseas coverage and improvement targets - tensions which were made tougher through matters over terrorism and nationwide safeguard. In making tips on tips to enforce the MCA successfully, this e-book heavily examines earlier relief efforts, traits within the US funds for overseas tips, the firms presently focused on administering US improvement coverage, and the ways that congress can impression and make certain relief results.

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Extra resources for The Other War: Global Poverty and the Millennium Challenge Account

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The richer countries are more likely to show stronger results, since they face fewer constraints than the low-income countries (which is one reason they receive larger private capital flows). For these reasons, if the administration sticks with the proposal to include the countries with incomes between $1,435 and $2,975, it would be preferable to allocate some share of the MCA funds to these countries, with the remainder to be used in the lower-income group. As suggested by Radelet,10 a reasonable amount would be $1 billion per year, 20 percent of the total.

30 While many call for leadership in donor coordination, donors remain reluctant to relinquish control of funding. Due to disparate conditionality and earmarking requirements, donors often establish parallel or competing projects. Postdisaster assistance especially sees the problem of redundancy in the rush to send relief aid. 31 Unfortunately OCHA’s reliance on voluntary contributions has limited its ability to lead. 32 These disaster appeals do provide a model for detailing the tasks at hand and assigning responsibility.

This will be particularly important once the MCC begins to operate in lower-middle-income countries, where trade and investment opportunities and macroeconomic policies tend to be more important to growth and poverty reduction than are aid flows. 3 Who Should Qualify? ”1 The administration subsequently announced the procedure it proposes to follow in determining which countries are meeting these three broad criteria. The proposed methodology is one way to address several key issues central to the MCA, including: —the income levels that will determine the set of eligible countries, —the specific indicators that will be used to show commitment in the three broad areas, —the passing grades on each indicator, and —the method of aggregating across the indicators to determine the list of qualifying countries.

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