Compact is an assistance program provided to the Republic of Moldova by the Government of the United States of America, acting through the Millennium Challenge Corporation. The Compact aims at increasing the incomes of the Moldovan population by increasing agricultural productivity and also the access to markets and services through investments in roads.
The Compact has two complex projects – Road Rehabilitation Project and Transition to High Value Agriculture Project, which invest in road infrastructure, irrigation sector and transition to high value agriculture.
The $ 262 million Compact is a grant provided for the period of 2010-2015.
These funds will be used to rehabilitate a 93 km road segment of the national M2 road, starting at Sarateni junction and going to the R7 junction east from Drochia (Drochia junction), and also to rehabilitate up to 11 centralized irrigation systems, provide assistance for the establishment of Water Users Associations, Post-Harvest Infrastructure Credit Facility and also assistance to farmers to grow their sales in high value products.
The direct beneficiaries of the Compact are about 300 thousand people living along the road to be rehabilitated and also drivers and road users. The rehabilitated road will facilitate the access to hospitals, schools and other social institutions, mainly for women, children and the elderly and will reduce the transportation costs.
The Compact will also benefit the agricultural producers that cover over 3 000 farms in the command areas of the centralized irrigation systems to be rehabilitated. The entrepreneurs who intend to invest in the post-harvest infrastructure (cold storage, sorting and packing lines etc.) will have the possibility to take loans.
The Moldovan Government implements the Compact according to the Compact Agreement signed between the Government of the Republic of Moldova and the U.S. Government, acting through the Millennium Challenge Corporation. In March 2010 the Moldovan Government established the public entity „Millennium Challenge Account Moldova” which coordinates all the activities related to Compact implementation. Some of the Compact activities are performed by companies selected through competition.
Many countries want to receive Compact assistance, but few of them manage to grasp this opportunity.
Moldova became eligible for Compact in 2006 after proving that it is committed to good governance (political rights, civil liberties, control of corruption, government effectiveness etc.), investment into people (public expenditures on health and primary education, natural resources management etc.) and economic freedom (business start-up, inflation, fiscal policy etc.). The progresses of Moldova in these areas are monitored on a regular basis.
The Sarateni-Soroca road segment is expected to be rehabilitated by 2014. The rehabilitation works entail rehabilitation of the entire road system, including road corrections, improvement and rearrangement of junctions with national and local roads etc., which will increase safety of the road traffic and also rehabilitation of local roads to social facilities like schools, mounting bus stations, provision of lighting along the road crossing the localities etc.
The Compact will rehabilitate up to 11 centralized irrigation systems – Blindesti, Cahul, Chircani-Zirnesti, Costnita, Criuleni, Grozesti, Jora de Jos, Leova, Lopatna, Puhaceni and Roscani, 6 of which are located in the Nistru River basin and the other 5 in the Prut River basin.
The Millennium Challenge Corporation has clear and uniform procurement procedures applied by all countries implementing Compacts. The key principles governing the procurement process are competitiveness and transparency. All the information about the Compact procurements is public and posted on the web site of the MCA Moldova www.mca.gov.md, and also published in various national and international newspapers.
For transparency and impartiality purposes, MCA Moldova has contracted a Procurement Agent to coordinate the procurement process.
