MCA compact yet to roll out

No agreement has yet been struck on the date for the rollout of the US$351m Millennium Challenge Compact for Malawi as the local office is still occupied with preparing the ground for the take off.

However, Millennium Challenge Account Malawi (MCA-Malawi) Chief Executive officer Susan Banda says her office, which is discussing the rollout with MCC, is “looking to the second part of the year (for the compact) to enter into force”.

She said, meanwhile, her office is engaged into preparatory work that has involved development of a financial plan for Escom to help it become a more sustainable utility financially, recruitment of consulting engineers who will carry out the design process and look at the investment package.

“Entry into force is a day we are working on with MCC. So once we hit that date, then the five year clock will start ticking. Meanwhile, there is a lot of work that is going on. For example, in the past six months, we have been working with Escom to develop the financial plan,” she said.

With the plan, she said, Escom would now be able to present an application to Mera with analytical basis as to demonstrate the costs that the utility firm needs in order to provide efficient services.

According to Banda MCA-Malawi has, besides Escom, been working with Mera and the Ministry of Energy to put together the implementation plan, procurement processes and also developing actual programmes ahead of the roll-out of the five-year compact, the first of its kind in the country.

The observation was made Tuesday in Lilongwe when Deputy Vice President for the Department of Compact Operations in the Millenium Challenge Corporation Andrew J. Mayock led a press briefing of the progress that has so far been made in their work with the local Millennium Challenge Account.

On his part, Mayock said the character of the compact where ever it has been implemented is one that encourages transparency and is not in any way attached to any conditions although when issues of governance and security arise, MCC would, as it has done in the past, take appropriate steps.

“We will continue to have dialogue. Yes if issues come along as they did in Malawi in the past, we will engage in dialogue with the government about how to remediate those issues. It’s a pretty consistent high level dialogue when issues do arise,” Mayock said

Major contract works in the $351 m Millennium Challenge Compact for the Malawi energy sector are likely to go to established foreign firms as MCA-Malawi describes the works ‘complex in nature’, requiring “wide experience in the design” and only for firms capable of working within five years.