KATHMANDU: The Millennium Challenge Corporation (MCC), a foreign aid agency renowned for its bipartisan support and transparency, is being shut down by the Department of Government Efficiency (DOGE), according to an all-staff email obtained by *Politico*. Established in 2004 under the George W. Bush administration, MCC partners with over four dozen developing countries to promote economic growth and currently oversees $5.4 billion in active grants across 20 lower-income nations.
In the email, MCC’s acting CEO stated that DOGE would oversee a “significant reduction” in the agency’s programs and workforce. Employees were informed of voluntary early retirement (VERA) and deferred resignation (DRP) programs, with applications due by April 29. Some staff may face administrative leave starting May 5, although the exact timeline remains uncertain.
The agency, comprised of over 320 employees, will see its operations terminated within 90 days, according to one anonymous employee. The source emphasized that the shutdown is unrelated to waste or corruption, pointing to MCC’s consistent history of clean audits and transparency.
DOGE is expected to draft a resolution next week for MCC’s board — which includes Secretary of State Marco Rubio, Treasury Secretary Scott Bessent, U.S. Trade Representative Jamieson Greer, the acting CEO, and four private sector members — to terminate grants within the coming months. Several countries, including Côte d’Ivoire, Mongolia, Senegal, and Nepal, have requested exemptions for wind-down periods ranging from three to four months.
Despite its strong performance, MCC has been targeted for closure, reflecting what critics see as a broader de-prioritization of foreign aid by the administration. An MCC employee lamented the decision, saying, “Our agency has always been hailed as a model for efficiency and transparency, but obviously, foreign aid is not a priority in this administration.”
MCC’s closure follows meetings between DOGE staffers Justin Fox and Nate Cavanaugh and MCC leadership. The move also comes amid leadership changes at DOGE, as Elon Musk, who leads the agency, announced plans to step back following Tesla’s disappointing first-quarter earnings. Musk’s exit, however, is not expected to halt DOGE’s aggressive dismantling of federal programs.
Notably, in December, Sen. Jim Risch (R-Idaho) introduced legislation to expand MCC’s authority, underscoring its bipartisan appeal. However, such efforts were insufficient to prevent its shuttering.
The impending shutdown of MCC highlights a significant shift in U.S. foreign aid policy. Once lauded by the aid transparency group Publish What You Fund as the world’s most transparent bilateral agency, MCC’s dissolution could leave a gap in U.S. efforts to foster economic growth in developing countries. A DOGE spokesperson declined to comment on the situation.
