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The Board of Trustee then shall submit a semester progress report on the implementation of activities and management of trust fund to Head of National Development Agency, Minister
of Finance and other relating minister. The Host MinisterHead of Agency who established the trust fund require to continuously monitor and evaluate the implementation and management of
the development trust fund.
C. The Existing Indonesian Development Trust Funds
Not so long after the enactment of Perpres No. 802011, the GoI has successfully established two national development trust funds namely Millennium Challenge Account-
Indonesia MCA-I in 2012 and Indonesia Climate Change Trust Funds ICCTF in 2014. The two national trust funds are being managed by a national trustee institution under
coordination of Bappenas. This part outlines a brief background of the each development trust fund and describes the characteristics of its organization.
1. Millennium Challenge Account-Indonesia
a. MCC and MCA
The MCC
167
is a government corporation, part of the US executive branch, that responsible for carrying a new initiatives from the US government to assist a few countries that
have demonstrated a commitment to sound development policies and where U.S. support is believed to have the best opportunities for achieving the intended results.
168
This new initiative is called the Millennium Challenge Account MCA.
169
167
MCC is established by the Millennium Challenge Act of 2003 22 U.S.A § 7701 2006.
168
See generally Congressional Research Service, The Millennium Challenge Account: Congressional Consideration of a New Foreign Aid Initiative
Aug 23, 2003 on file with author also available at http:fpc.state.govdocumentsorganization39340.pdf
.
169
See generally Gerald van Bilzen, supra note 115.
38
Participants would be selected based on a transparent evaluation of a co untry’s
performance on specific economic and political indicators, divided into three clusters corresponding to the three policy areas of governance, economic policy, and investment in
people. In order to be eligible for MCA funding, a candidate country must 1 fall within per capita income limits; 2 score above the median relative to other potentially eligible countries
on at least half the indicators in each category; 3 score above the median on the “control of
corruption” indicator; and 4 not be barred from receiving U.S. aid i.e., trade sanctions.
170
One indicator, control of corruption, is a passfail measure: a country must score above the median on this single measure or be excluded from further consideration.
171
The MCA requires candidate cou
ntries to overcome these hurdles “to ensure that resources are channelled towards countries that are performing well in a variety of dimensions of governance, and in
which corruption especially is relatively low.
172
The degree to which a country controls corruption is one of the performance indicators that help determine whether a country should be
eligible for compact funding.
173
In the 2014 compact eligibility selection process, two countries that had been selected in 2013, Benin and Sierra Leone, were dropped from compact
consideration due to their failing grades on the “control of corruption” indicator.
174
In its December 2014 meeting, the MCC Board issued a
warning to Tanzania that, although
170
Daniel Kaufmann Aart Kraay, Governance Indicators, Aid Allocation, and the Millennium Challenge Account,
45 Dec. 2002 Draft for Discussion On file with the World Bank, available at http:www.worldbank.orgwbigovernancepdfgov_indicators_aid.pdf
.
171
Congressional Research Service, supra note 168, at. 1.
172
Id.
173
Curt Tarnoff, Millennium Challenge Corporation 25 March 2015 Congressional Research Service on file with author available at
https:www.fas.orgsgpcrsrowRL32427.pdf .
174
Id.
39
reselected for a second compact, such a compact would not be approved unless its declining corruption score was reversed with “firm concrete steps.
175
MCC typically required the recipient country, by the time of compact signing, to establish an accountable entity, also known as the MCA, as point of contact during program
development. Its board that usually composed of government and non-government officials, including representatives of civil society. The government representatives are usually ministers
most closely associated with compact project sectors.
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b. Trust F und of Millennium Challenge Account-Indonesia
