On 7 April 2011, the Government of Malawi signed a US$350 million Compact agreement with the United States Government through the Millennium Challenge Corporation (MCC). Through this agreement, Malawi will upgrade, rehabilitate and reform the energy sector in order to improve generation, transmission and distribution of electricity. The MCC Vice President for Compact Operations Patrick Fine represented the MCC during the signing ceremony and sheds more light on the Malawi Compact in this interview.

Q. What is the Malawi Compact and what does it mean for the people of the two countries?

This Compact is a manifestation of a partnership between the Government of Malawi and the people of Malawi, and the Government of the United States and the people of the United States, that we will work together to address one of the critical constraints to economic growth in the country, one of the key blocks to prosperity.

We believe that by investing US$350 million into the energy sector, into a very well thought out plan, we will also attract private sector investment and other donors such as the World Bank and that will be key to unlocking economic potential in the country.

Q. What Should Malawians expect from the implementation of the Programme?

The project is not going to cause the blackouts to go away overnight and we need to be careful that we don’t raise people’s expectations unrealistically, but it will lay a foundation to have reliable energy over the next five years. So, yes I do believe that this investment is going to be a major part of the government’s effort to ensure sustainable energy for its population and to expand that outside of the urban areas into the rural areas so you have a broader portion of the population with access to electricity.

Q. How is MCC going to ensure that the resources are used for the intended purpose?

MCC has many checks to ensure accountability of the funds that it provides, those checks are formal audits of the institutions that are managing the funds, there is informal monitoring and then there is an oversight layer that is directly by the MCC, so a combination of the oversight and a very structured process for managing the funds ensures that they go where they are expected to go.

Q. Malawi unlike many other Compacts is a one sector programme, what challenges do you see in implementing such a programme?

Actually we want to have programmes that are more cohesive and coherent and so for us having a programme that focuses on one sector is a good thing, and we are encouraging new countries that are developing their Compacts to have focused investments and not to have investments spread across several sectors.