10 December 2018

Senegal: U.S., Senegal Sign New Millennium Challenge Corporation Senegal Power Compact

Photo: Steve Ruark/MCC
MCC COO and Head of Agency Jonathan Nash and Senegalese Minister of Economy, Finance and Planning Amadou Ba shake hands during the ceremony to mark the signing of the MCC Senegal Power Compact at the State Department.
press release

The U.S. Government's Millennium Challenge Corporation (MCC) and the Government of Senegal today signed the new five-year $550 million MCC Senegal Power Compact.

MCC Chief Operating Officer and Head of Agency Jonathan Nash joined U.S. Secretary of State Michael Pompeo and Senegalese Prime Minister Mahammed Boun Abdallah Dionne to recognize the signing at the U.S. Department of State.

The Government of Senegal will contribute an additional $50 million to the compact, bringing the total program to $600 million.

MCC and the Government of Senegal developed the compact to strengthen the power sector and meet the growing demand for reliable electricity in one of Africa's fastest growing economies, and an important strategic partner of the U.S. in West Africa. The compact is designed to increase reliability and access to electricity, support economic growth and reduce poverty.

"Today, we mark an important milestone: the signing of the $550 million MCC Senegal Power Compact," MCC Chief Operating Officer and Head of Agency Jonathan Nash said during the signing event. "The MCC compact is designed to catalyze private sector investment, spur economic growth and reduce poverty by improving Senegal's power sector, reducing costs and expanding access to electricity."

The Senegal Power Compact is expected to benefit over 12 million people and consists of three projects:

The Modernizing and Strengthening of Senelec Transmission Network Project aims to strengthen and increase the reliability of Senegal's high-voltage transmission network in and around Dakar, the country's capital, and improve service delivery throughout the country. The compact supports the utility, Senelec, in reducing high production costs, facilitating private sector investment in generation, and increasing the reliability of electricity for consumers.

The Increasing Access to Electricity in Rural and Peri-Urban Areas Project seeks to extend and reinforce the electrical grid in selected rural and peri-urban areas in Senegal's south and center regions, which have high economic potential but low connection rates. The project will also help residents and business connect to the grid and access electrical equipment.

The Power Sector Enabling Environment and Capacity Development Project will work to strengthen laws, policies and regulations governing the power sector as well as the institutions responsible for implementing them to support long-term economic progress.

The Government of Senegal established a project management unit to work with MCC on the development of the compact, the Unite de Formulation et de Coordination du Second Programme MCA-Senegal (UFC). During the compact development process, MCC and UFC jointly identified Senegal's greatest barriers to economic growth and developed a program specifically aimed at addressing them. Coordinated analyses helped to determine compact activities most likely to contribute to sustainable economic growth that reduces poverty. Compact development has included a consultative process, engaging civil society, other government agencies, and the private sector.

The Millennium Challenge Corporation is an independent U.S. Government agency working to reduce global poverty through economic growth. Created in 2004, MCC provides time-limited grants and assistance to poor countries that meet rigorous standards for good governance, from fighting corruption to respecting democratic rights. Learn more about MCC at www.mcc.gov.

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