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Sustaining Compact Investment Four Years of Compact Contribution in Indonesia


(Jakarta) 27 April 2017 – Four years have passed since the Compact Grants from Millennium Challenge Corporation (MCC) started implementation in Indonesia. The Indonesia Compact has delivered various achievements that contribute to the Government of Indonesia’s poverty reduction efforts, particularly through economic growth. In its last year of
operations, Millennium Challenge Account Indonesia (MCA-Indonesia) as Compact’s implementing agency, will concentrate on ensuring the sustainability of its projects, which focus on three sectors: low-carbon economic development, stunting prevalence reduction and procurement modernization.

Minister of National Development Planning/Head of Bappenas, Bambang Brodjonegoro in his opening speech for “Four Years of Compact Investment” event stated, MCA-Indonesia must work hard to meet the set targets and ensure sustainability of Compact investment. “The Government of Indonesia is committed to accelerating efforts to increase economic growth and Indonesia’s competitiveness. We hope when Compact ends, all three projects – Green Prosperity, Health and Nutrition, and Procurement Modernization will generate valuable development models that we can utilize, implement, and replicate,” said Bambang Brodjonegoro.

US Ambassador for Indonesia, H.E. Joseph Donovan, said the Government of the United States is proud to partner with the Government of Indonesia through this endeavor. “Our Government is proud to partner with the Government of Indonesia through our Millennium Challenge Corporation (MCC). The model focuses on policy reforms, economic growth
opportunities that deliver tangible results and shared learning on what is and is not working,” Ambassador Donovan said.

MCA-Indonesia Executive Director, Bonaria Siahaan, said the 4th Year commemoration of Indonesia Compact today is part of the strategy to sustain Compact’s investment through stakeholder engagement. Through this forum, MCA-Indonesia aims to gain input, to appreciate, and to build closer cooperation with stakeholders. “We want our stakeholders to be involved in our sustainability efforts, particularly after Indonesia Compact ends in April 2018. We also hope to gain support from public agencies, development partners and civil society to ensure sustainability of the projects,” said Bonaria Siahaan.

In four years of Indonesia Compact implementation, various achievements have been delivered. The Green Prosperity Project has built collaboration with Peatland Restoration Agency (BRG) to support its performance in restoring 2-3 million hectares of peatland. The project has also signed 52 grants agreements on renewable energy, involving proponents in community level and private sector. Compact Program has also distributed grants to 53 grassroots community groups, including women groups, to improve natural resources management.

Through Procurement Modernization Project, MCA-Indonesia works with National Public Procurement Agency (LKPP) to give support for institutional strengthening, helping 29 pilot Procurement Service Units (ULPs) to gain permanent status. Human resources development carried out by the program has graduated 229 people who now have the capacity as international procurement experts. In terms of system, MCA-Indonesia has supported development of 16 local and national catalog contracts for goods that are routinely needed and available in free market. As the result, various central and local government agencies have saved Rp 2.3 billion from procurement of information and communication technology through catalog contract. Meanwhile in procurement of work uniforms through catalog contract, DKI Jakarta Provincial Government has managed to save Rp 10.3 billion or 30% of the budget for uniforms.

Last but not least, through Community-based Health and Nutrition to Reduce Stunting Project, MCA-Indonesia is contributing to the Government of Indonesia’s target to reduce stunting prevalence from 37% in 2013 to 28% in 2019. With innovative intervention that integrates nutrition, sanitation and communications, the project aims to prevent stunting in its locations, which are spread in 62 districts in 11 provinces. One of its pilot area, Ogan Komering Ilir District, has succeeded to reduce under-five stunting prevalence from 37% (2014) to 32% (2016). The project has also trained 17.515 people in various topics related to stunting, ranging from infant and young children feeding counseling, growth monitoring, sanitation entrepreneurship, to triggering of Community-led Total Sanitation. 25 districts have replicated the project approach with their own funds, either local government budget (APBD) or allocation from central government (DAU). All of these achievements can only be gained due to close collaboration with stakeholders. In the remaining one year, MCA-Indonesia will work hard to safeguard the sustainability of Compact investment in the future.

About Millennium Challenge Account – Indonesia (MCA-Indonesia)
MCA-Indonesia is the implementing entity of the Compact Grants from Millennium Challenge Corporation (MCC), which supports US Strategic Partnership with Indonesia. MCA-Indonesia aims to reduce poverty through economic growth, and manages the
following main projects: (1) Green Prosperity, (2) Community-Based Health and Nutrition to Reduce Stunting, and (3) Procurement Modernization.

About Millennium Challenge Corporation (MCC)
MCC is an innovative and independent agency of the US government, which aims to help alleviate poverty globally. Formed by the US Congress in 2004, MCC has distributed Compact Grants worth US $ 11.2 billion for 27 countries committed to good governance, economic freedom and investments in their citizens. Compact Grants are competitive, meaning that the candidate countries must compete in a transparent selection process. MCC holds the principle of country-led solutions and country-led implementation, so that the countries that receive the grants have the discretion and authority to identify problems
and solutions, and to develop and implement its program.

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