Namibia’s Millennium Challenge Account Proposal approved

The US Congress made US$3 billion available for the 2006 fiscal year and President George Bush pledged to increase annual funding for the MCA to US$5 billion in the future.

Explaining that Namibia became one of three lower middle income countries that have been identified as eligible to apply for Millennium Challenge Account (MCA) assistance for the 2006 fiscal year in November 2005, Ndaitwah said the lower middle income category had only been introduced in 2005 and the two other eligible countries in the lower middle income category were El Salvador and Cape Verde. Cape Verde was previously selected as MCA-eligible in the low income category.

Countries with a per capita income between $1 576 and $3 255 qualify for the lower middle income category.

Countries identified as eligible for the MCA are viewed as an elite group of countries who have demonstrated commitment to good governance, economic freedom and improving the lives of their people.

Selection does, however, not guarantee funding and eligible countries, including Namibia, had to embark on broad-based consultations to develop proposals that address the country’s barriers to poverty reduction and economic growth.

The key principles of the MCA are to reduce poverty through economic growth; to reward good policy, meaning that countries are selected for assistance on their performance in governing justly, investing in their citizens and encouraging economic freedom; to operate as partners with the Millennium Challenge Corporation and ensuring civil society participation; and to focus on results, indicating that MCA assistance will go to countries with well-developed programmes, clear objectives, benchmarks to measure progress and procedures to ensure fiscal accountability for the use of MCA assistance.

Following Namibia’s eligibility to qualify for funding from the MCA in November 2005, President Hifikepunye Pohamba directed the Director General of the National Planning Commission to negotiations and to coordinate the preparation of Namibia’s programme proposal to the Millennium Challenge Corporation.

The President also instructed that 90 percent of the MCA funding should go into rural development projects.

The MCA Office was established in April 2006 and a Core Team, led by Mrs. Penny Akwenye from the Bank of Namibia, was seconded to the National Planning Commission to prepare Namibia’s MCA programme proposal.

A number of stakeholders from Government, regional institutions and traditional leaders were consulted to solicit inputs for the programme proposal. Regional consultations were held between 3 June and 18 July 2006 and consultations on the national level came to an end on 25 July 2006. During this time, all 13 regions were visited and 17 national institutions were consulted.

The proposal has also been aligned with existing policies, such as Vision 2030, the Participatory Poverty Assessment, the Permanent Technical Team on Land Reform, the Green Scheme and the Education and Training Sector Improvement Programme (ETSIP).

Ndaitwah said that Namibia’s Millennium Challenge Account Programme Proposal had been submitted to the Millennium Challenge Corporation in Washington on Friday, 29 September 2006 and that the country was now waiting on a response to its proposals.

The proposal covers various investment interventions in two main themes, namely to improve human resources capacity and skills, empowering the Namibian workforce to become more competent (knowledge, skills and attitude) and to increase productivity of (on-farm and off-farm) enterprises in rural areas.

The four key sectors covered the proposals are Education; Livestock Production and Marketing; Tourism; and the Green Scheme and Indigenous Natural Products. One cross-sectional intervention is that of Rural Access Roads.

The Education proposal includes amongst others a revolving MCA Bursary Trust for selected areas of study; the construction and equipment of new vocational training centres and the maintenance of existing centres; the construction and equipment of secondary schools; the provision of computer laboratories at secondary schools and the construction of a business innovation centre at the Polytechnic of Namibia.

In the area of Livestock Production and Marketing the construction of veterinary stations and the tagging of animals; the clearing of bush-encroached farmland; the establishment of a number of feedlots; and the upgrading of quarantine facilities are proposed.

With regards to Tourism, assistance is needed for resource development and management; marketing; barrier removal; empowerment and capacity building.

Under the Green Scheme proposal, specific reference is made to the Kavango, Caprivi, Omusati, Hardap and Karas Green Schemes, while a market hub and grain storage facilities at Rundu are also proposed.

The proposal on Indigenous Natural Products deals with product specific actions for amongst others wild silk production; cultivation of Hoodia; Kalahari melon seed and Devil’s claw propagation.

Under the cross sectional intervention, seven rural access roads are proposed.

October 2006
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