MINISTRY OF FOREIGN AFFAIRS OF THE REPUBLIC OF ARMENIA
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PRESS AND INFORMATION DEPARTMENT
375010 Telephone: +37410. 544041 ext 202
Fax: +37410. 562543
Email: press@mfa.am

PRESS RELEASE

28-03-2006

Millennium Challenge Corporation Signs Five Year, $235 Million Compact
with Armenia

In a signing ceremony at the State Department’s Benjamin Franklin
room on March 27, Chief Executive Officer of the US Millennium
Challenge Corporation, Ambassador John Danilovich and Armenia’s
Minister of Finance and Economy, Vardan Khachatryan signed a $235.65
million Compact between MCC and the Republic of Armenia. Armenia’s
Foreign Minister Vartan Oskanian and MCC Chair, US Secretary of State
Condoleezza Rice spoke at the signing.

Minister Oskanian’s statement:

I am here today, on behalf of the President of the Republic of Armenia
and my colleagues here from the Armenian government, to thank President
Bush, Secretary Rice, Ambassador Danilovich, the US government and
the American people, for including the Republic of Armenia in the
Millennium Challenge Compact.

President Bush’s visionary approach to development, which complements
the invaluable assistance that has already been provided to Armenia
through USAID and other US programs, continues the best tradition of
American missionaries, from whom Armenians had benefited greatly.

The MCC is a natural extension of their practice -doing good
born of one’s own convictions, but with the intent to nourish the
recipient’s sense of self-worth and ability. In the 21st century,
when philanthropy is not about charity but about finding solutions
to deep-seated problems, we welcome the US government’s decision to
assist and support directly those countries who have determined to
rule justly, to invest in people and to promote economic freedom –
in order for their citizens to live in dignity and security.

I see here our colleagues from other recipient countries, and I am
certain that they join me in saying that with this grant, the US is
recognizing the reality and duality of our lives – persistent poverty
in the face of progress.

On the one hand, one third of Armenia’s population continues to live
in poverty, two-thirds of our rural communities are not directly
connected to a central water distribution system, and most of our
secondary and tertiary roads do not provide the necessary access.

On the other hand, Armenia has managed, against great odds, with an
unresolved conflict and with closed borders, to be ranked first in
the world in best utilization of foreign assistance, to privatize and
to legislate such that our economy is ranked among the world’s most
liberal, and to register the highest economic growth in the region,
without the benefit of extractive resources.

That is why a long consultative process concluded that for significant
poverty reduction, we would request MCC funds to be spent in two
critical areas of infrastructure. Our program has been consciously
designed to complement the work of other donors.

With this signing of the Millennium Challenge Compact, Armenia is aware
that we have the obligation to build on the confidence that has been
placed in our government and people. Just as economic development is
a facilitator of democratization, so is democracy a tool for further
and deeper economic development. We understand that the US Government
has chosen to use these funds for economic development, only when a
society and its leadership comprehend their political responsibility
to nurture and sustain democratic practices.

Armenia is among the world’s youngest democracies and our democratic
and economic reforms are irreversible. Our significant progress
notwithstanding, we recognize that much remains to be done to make
these reforms comprehensive. We know that corruption must not be
tolerated and that the law must rule, that the principles of democracy
must be transformed to traditions of democracy in our country.

Madame Secretary, the elections of 2007 and 2008 will test our
democratic practices. Our task, until then, is to partner with the US
and European governments to implement the necessary corrective steps
to improve the conditions necessary for an honest and fair expression
of people’s voices.

In this regard, we welcome the American proposals for certain
structural reforms and education and public outreach efforts. We’ve
already begun the process of verifying voter lists, we’re making
progress in reforming the electoral law with the active participation
and agreement of all political forces in parliament. As in years past,
OSCE monitors will be present and will monitor elections.

In other words, Madame Secretary, Armenia and Armenians are determined
to benefit from the intent and content of the Millennium Challenge
Compact. Because our people deserve no less.