WASHINGTON (September 28, 2022) — U.S. Secretary of State Antony Blinken and Malawian President Lazarus Chakwera today joined nearly 100 U.S. and Malawian leaders to sign the Malawi Transport and Land Compact — a $350 million infrastructure grant between the US government’s Millennium Challenge Corporation (MCC) and the government of Malawi.
MCC Chief Executive Alice Albright and Malawi’s Minister of Finance and Economic Affairs Sosten Alfred Gwengwe were signatories to the pact.
“This agreement opens a new chapter in the partnership between the United States and Malawi,” said Secretary Blinken, who is the Chairman of the MCC Board of Directors. “[A partnership] which builds on our close collaboration for decades, our shared democratic values and the common vision of a prosperous, stable and resilient Malawi…Malawi will take the lead in putting these plans into action. Like all MCC efforts, these projects will be transparent, they will be collaborative, and they will be built to meet the highest quality standards.
The Malawi Transport and Land Compact, which includes an additional $26.5 million contribution from the Government of Malawi, is designed to reduce transport costs by improving more than 300 kilometers of roads to connect farmers to markets and strengthening transport. country’s land administration.
“We are proud to continue our long-standing partnership with the Government of Malawi, which will have brought, in total, more than $747 million of transformative projects to the country once the infrastructure projects of our last program are completed,” said Albright. “In total, MCC grantmaking programs in Malawi are expected to benefit more than 12 million people, about half of the total population, while cutting across key sectors such as transport, energy and agriculture. These investments, coupled with key policy and institutional reforms in the country’s land sector, will facilitate additional private sector investment and directly benefit Malawi’s greatest resource. – arable lands.”
Albright added that MCC has invested over $9 billion in 25 African countries. These investments are expected to benefit more than 90 million people, including 5.3 million Malawians from the new Malawi Transport and Land Compact.
Malawi’s economy has been significantly impacted by the competing crises of global climate change, COVID-19 and the Ukraine/Russia conflict. In a joint analysis of Malawi’s economy, MCC and the Government of Malawi identified the country’s exceptionally high transport costs as a key economic barrier between farms and markets, as well as difficulties in accessing land for investment due to uncertain land rights.
Compacts Accelerated Growth Corridors Project will invest more than $228 million in Malawi’s transport sector, including road improvements in four selected corridors located in prime agricultural areas. The project also prioritizes road safety, future maintenance and increased competition by helping the Government of Malawi address policy, legislative, institutional and funding challenges that limit larger road improvements.
Compacts Land Productivity Enhancement Project aims to sustainably improve the way land is used and managed at the national and sub-national level, including the coordination of land use planning, revenue collection and land services. The project also aims to modernize and increase the efficiency of property tax management systems that support improved service delivery in Malawi’s four largest cities. Project activities will improve the functioning of land markets while improving overall land values and encouraging private investment.
“It’s a historic occasion” said President Chakwera during the ceremony. “This is a very important program for Malawi, and a testament not only to the long-standing relationship between Malawi and the United States, but also to the progress Malawi has made in recent months to meet to the rigorous standards of the MCC scorecard, [and] the policies we have implemented for the advancement of government, economic freedom, democracy, investment and the fight against corruption.
“Combating corruption ensures that investments such as the MCC compact serve their purpose and produce the intended benefits,” President Chakwera added.
MCC and the Government of Malawi first partnered in 2004 with a $20.9 million threshold program and again in 2011 with a $350.7 million energy-focused compact. The previous MCC-Malawi compact built the infrastructure Malawi needed to connect to the Southern African Power Pool, expanded access to reliable power supply through the construction and rehabilitation of 22 sub- stations and 367 km of transmission and distribution lines, provided an additional 12 megawatts of clean energy to the country and supported the reforms needed to bring independently generated electricity onto the Malawian grid.
“I am very grateful, once again, to the American people and the US government for their partnership in the development of Malawi,” President Chakwera said. “Together, we move forward for the good of all.”
The Millennium Challenge Corporation is an independent US government agency that works to reduce global poverty through economic growth. Established in 2004, MCC provides time-limited grants and assistance to countries that meet rigorous standards of good governance, anti-corruption, and respect for democratic rights.