MCC Compact Enters Full Implementation Phase

The Millennium Challenge Corporation (MCC) Compact in Nepal has officially begun its full-fledged implementation on Wednesday. The Millennium Challenge Account Nepal (MCA-Nepal) announced the commencement of the Entry into Force (EIF) program component on August 30, marking the initiation of a five-year period dedicated to project completion.

The focus of this endeavor lies on power transmission lines and road construction, pivotal elements of the MCC Nepal Compact. The project’s stakeholders now have five years to bring these initiatives to fruition.

The United States Embassy in Kathmandu expressed its enthusiasm for the progress achieved under the Nepal-led MCC Compact. The collaborative efforts of diverse stakeholders, successive governments, and political parties have been credited for driving the project forward in Nepal.

A spokesperson from the US Embassy highlighted the commitment to working closely with MCA-Nepal to ensure the successful execution of the Compact’s objectives. The spokesperson noted the collective diligence of all parties involved to meet the specified goals within the designated timeline.

MCA-Nepal reported that out of the six preconditions outlined for EIF implementation, five have been satisfied. However, the finalization of land acquisition for the project’s execution is still pending. Notably, the construction of electricity transmission lines necessitates a total of 1,471 hectares of land.

Originally scheduled for implementation on June 30, 2020, the EIF encountered delays due to challenges in obtaining parliamentary endorsement for the MCC and meeting project prerequisites.

Back in September 2017, the Nepal Government’s MCC had entered into a $500 million grant agreement with the US Government. Unfortunately, delays in the project’s implementation have led to an increase of $67 million in the government’s financial liability.