KATHMANDU: The Millennium Challenge Corporation (MCC), a U.S. foreign aid agency known for its bipartisan support and strong track record of transparency, is being shut down by the Department of Government Efficiency (DOGE), according to Politico.
Created in 2004 during President George W. Bush’s administration, the MCC has worked with over 50 developing nations to promote economic development and currently manages $5.4 billion in grants across 20 low-income countries.
The email, sent by MCC’s acting CEO, revealed that DOGE will be overseeing major program and staff cuts. Employees were offered voluntary early retirement (VERA) and deferred resignation (DRP) options, with an April 29 application deadline.
Some may be placed on administrative leave starting May 5, though a detailed timeline hasn’t been finalized.
The MCC, which employs over 320 people, is expected to cease operations within the next three months, according to an unnamed employee.
This source stressed that the closure is not due to any financial mismanagement or scandal, highlighting the agency’s consistent record of clean audits.
Next week, DOGE plans to propose a resolution to the MCC board — which includes Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer, the acting CEO, and four private members — to formally end current grant programs.
Several partner nations, such as Côte d’Ivoire, Mongolia, Senegal, and Nepal, have requested additional time to wrap up their projects, asking for extensions of three to four months.
Despite MCC’s solid performance, the agency is being shut down, which critics view as part of a broader retreat from U.S. foreign aid under the current administration.
One MCC employee expressed disappointment, saying, “Our agency was seen as a model of efficiency and transparency, but clearly, foreign aid isn’t a priority anymore.”
The closure comes after meetings between DOGE officials Justin Fox and Nate Cavanaugh and MCC leadership. It also follows a shift in DOGE’s leadership, with Elon Musk announcing his intent to step down after a weak earnings report from Tesla. His departure isn’t expected to slow DOGE’s efforts to dismantle federal programs.
Interestingly, in December, Sen. Jim Risch (R-Idaho) introduced a bill to expand MCC’s powers, reflecting its broad political support. However, these efforts weren’t enough to save the agency.
MCC’s shutdown marks a major change in U.S. foreign aid policy. Once praised by organizations like Publish What You Fund as the most transparent bilateral aid agency in the world, its closure could create a gap in U.S. efforts to promote economic development abroad. DOGE declined to comment.
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