2003 Offering of Letters

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OVERVIEW OF THE 2003 OFFERING OF LETTERS CAMPAIGN
RISE TO THE CHALLENGE: END WORLD HUNGER

In March, 2002, world leaders gathered at a United Nations conference in Monterrey, Mexico, to discuss ways of building a more prosperous world community. The group sought funding commitments from both rich and poor nations to reach a set of internationally agreed upon targets for cutting in half extreme hunger and poverty and for substantially improving health and education in developing countries by 2015. These targets, called the Millennium Development Goals, were approved in 2000 by 189 countries, including the United States. (For more on the Millennium Development Goals, click here.)

Just prior to traveling to Monterrey, President George W. Bush announced that the United States would significantly increase development assistance to poor countries that demonstrate a commitment to good governance, investment in people and sound economic policies. Citing and affirming the Millennium Development Goals, the president said the increased assistance would go to a new Millennium Challenge Account (MCA) to fund initiatives that improve the lives of people in developing countries around the world.

The new commitment was welcome news. For decades, Bread for the World members and people of faith across the United States have prayed for and worked to help families struggling to escape from hunger and poverty in the developing world. Bread for the World’s involvement in the Jubilee campaign helped bring debt relief to some of the world’s poorest nations. Offerings of Letters in recent years have focused on increasing poverty-focused development assistance to Africa, the one region of the world where hunger is widespread and increasing.

The proposed Millennium Challenge Account provides us with an unprecedented opportunity to engage members of Congress and other key decision makers on the issues facing hungry and poor people around the world. Since the MCA announcement came from the administration, Congress will give it serious consideration, turning its attention to development assistance and its effectiveness.

To truly make headway toward the Millennium Development Goals, we need to make sure that the MCA remains focused on poverty reduction and is adequately funded. People who have been calling for the United States to do more to help fight poverty worldwide must take responsibility for helping to shape this important new program in such a way that it reaches people in need.

Bread for the World members and supporters have been powerful voices on this issue. So we must take the next step. With our 2003 Offering of Letters, Rise to the Challenge: End World Hunger, people of faith and conscience will work to ensure that the Millennium Challenge Account is designed in a way that will indeed help poor people become self-reliant, help parents care and provide for their children, and enable children in developing countries to grow up to lead long, healthy and productive lives.

LEGISLATIVE UPDATE as of May 22, 2003

Recent Developments:
Senate Committee marks up MCA legislation

On May 21, the Senate Foreign Relations Committee marked up legislation to establish a Millennium Challenge Account (MCA) that will dramatically increase development assistance to poor countries committed to using the funds to reduce hunger and poverty. (Read the press release.) Overall, Bread for the World sees the bill as a big step forward.

The Senate bill authorizes $1 billion for next year, climbing in bigger steps to the goal of billion by FY 2006. One key issue that Bread for the World has been working on concerns which countries will become eligible for MCA funding (click here for more information). The Senate bill mandates that all the MCA money will go to low-income countries until appropriations exceed billion annually; if that happens, a fraction of the money can go to the lower-middle-income countries the administration wants to include. The bill also mandates grassroots participation in planning and implementation, and it specifically references the Millennium Development Goals.

The House International Relations Committee is currently scheduled to mark up their version of MCA legislation in early June.

The Low-Down on Country Eligibility
President Bush's Millennium Challenge Account legislation bill states that the purpose of the MCA is to reduce global poverty by increasing economic growth and focusing on countries with "significant poverty" that are committed to good governance and poverty reduction. It lays out broad selection criteria--ruling justly, investing in people and economic freedom. It calls for civil society participation and local ownership in funding decisions and improved coordination with other donor agencies.

However, it provides few details about what is meant by "significant poverty", civil society participation, local ownership and donor coordination, and how the implementing agency should put into practice these policies. It also provides the administration with maximum flexibility with little congressional oversight.

Bread for the World supports an MCA that is limited to the poorest countries. In the President's proposal (which was introduced in the House by Rep. Henry Hyde (R-IL) chair of the House International Relations Committee), it seems likely that only countries where the average income per person is less than about per person would qualify during the first two years of the program. These are the world's poorest countries and include many of the countries in sub-Saharan Africa. But it also appears likely that both the House and Senate bills will allow countries where the average income is around per person to receive MCA funds in the third year of the program and beyond.

This would significantly reduce the amount of money available to the poorest countries and it could make the MCA an instrument to reward U.S. allies in the fight against terrorism instead of an instrument to reward those countries that are committed to reducing hunger and poverty. Many of these so-called lower middle-income countries are in Central Asia, such as Tajikistan.

Rewarding countries that support the U.S. fight against terrorism is an important component of U.S. foreign policy, but it should not be confused with the purposes of the MCA. The MCA should remain focused on helping the world's poorest countries meet the Millennium Development Goals.
Low-income countries face far greater development challenges than the lower-middle income countries and have access to far fewer resources.
The MCA is an opportunity to significantly increase the resources available to the poorest countries so they can invest in basic health, education, rural development and smallholder farming.