Benin Power Compact - Constraints Analysis

MCC’s evidence-based approach to its investments begins with a mutual understanding of a country’s main growth challenges. During the first phase of the compact or threshold program development process, MCC and the selected partner country, jointly conduct a constraints-to-growth analysis (CA). This analysis identifies the constraints to private investment and entrepreneurship that are most binding to economic growth in the country. The results of this analysis enable the country, together with MCC, to select activities most likely to contribute to sustainable, poverty-reducing growth.

The Constraints Analysis Report for the second Benin Compact highlights poor electricity infrastructure as the binding constraint to economic growth in Benin, where the insufficient quantity and quality of electricity results in reduced productivity, output, and investment for businesses, less effective delivery of public and social services and diminished well-being and economic opportunity for households. The root causes of these problems are lack of resources, and public policies and institutions that have been unable to deliver sufficient power to meet growing national demand.