The Millennium Challenge Corporation Looks to Sri Lanka

The Millennium Challenge Corporation's (MCC) Board of Directors recently held its latest quarterly meeting. At that time, the board selected five countries as eligible to receive MCC funding for 2016: Cote d'Ivoire, Kosovo, Senegal, Togo and Sri Lanka.

An independent American foreign aid agency that's part of the U.S. government, the MCC's website states that it was established "by the U.S. Congress in January 2004 with strong bipartisan support" and that the "MCC is changing the conversation on how best to deliver smart U.S. foreign assistance by focusing on good policies, country ownership, and results." It works across a range of issues including: health, water, agriculture, anticorruption, land rights and education.

Going forward, there are details that the MCC and Sri Lanka still need to work out. According to a MCC spokesperson, the "MCC and the Government of Sri Lanka will come together in the coming months to assess the country's greatest constraints to economic growth, opportunities for private investment, and social constraints to poverty reduction. The results of this assessment help to define the policy and institutional reforms that the new threshold program will support. The length of program development depends on Sri Lanka's commitment to the process and reaching agreement on a reform agenda. This can take up to a year or more."

The spokesperson noted that determining the precise nature of the funding would be done through a "comprehensive and collaborative" process; and that Threshold Programs (the type of program which Sri Lanka is eligible for) usually range between $10 million and $50 million.

Clearly, the MCC is satisfied with recent developments in Sri Lanka this year. "Sri Lanka has embarked on a remarkable effort over the past year to reinvigorate its democratic institutions, improve governance, and restore protection of human rights," says the spokesperson.

The spokesperson also states that the recent MCC decision regarding Sri Lanka's "eligibility for a threshold program allows Sri Lanka an opportunity to further strengthen its scorecard performance and consolidate the encouraging democratic gains made throughout 2015, and allows MCC the opportunity to assess the country's ongoing commitment to good governance and progressive policy reform."

This development is another piece of good news for the administration of President Maithripala Sirisena. It also jives with the broader trajectory of U.S.-Sri Lanka ties since Sirisena assumed office in January. We've seen numerous high-level visits by senior U.S. government officials, sustained praise from Washington and even the formalization of an annual U.S.-Sri Lanka "Partnership Dialogue".

In terms of the progress made thus far, the reality is more complicated than it may at first appear; early steps in the right direct don't constitute dramatic change, especially when it comes to peoples' daily lives in the war-torn Northern and Eastern Provinces. In fact, the bulk of the new government's reform agenda hasn't been implemented and it's not clear that it ever will be. As Colombo continues to receive accolades from the international community, Sirisena and company must now turn to the formidable task of deeper reform, including a comprehensive transitional justice package.

The inescapable reality is that Sri Lanka's acclaimed "democratic transition" is far from finished.

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