The Millennium Challenge Corporation (MCC) was established in 2004 to reduce poverty through economic growth in a select number of well governed low income and lower middle income countries. This is achieved through threshold and compact assistance programs implemented in countries committed to ruling justly, promoting economic freedom, and investing in their citizens.  When developing a threshold program, MCC emphasizes the importance of a government’s demonstrated commitment to these three principles, along with country ownership of the reform process.  Policy reform supported by a threshold program should, if fully implemented, improve the prospects for economic growth and poverty reduction, and provide a basis for further reform efforts.

This paper will focus on the Malawi and Rwanda threshold programs. The Malawi program’s main goal was to reduce corruption and improve financial management by strengthening (and establishing, when needed) systems for preventing corruption, increasing the effectiveness and independence of oversight institutions, and developing effective enforcement and deterrence systems.  The Rwanda program focused on increasing citizens’ political rights and civil liberties and on strengthening voice and accountability institutions, including local governments, the judiciary, media, and civil society.

After providing an overview of the evolving threshold program model, the author will briefly describe both programs and offer some implementation “best practice” lessons learned by MCC.