The amount was to be released to Sri Lanka under a proposed MCC compact, which is a large-scale five-year grant programme.
MCC Managing Director for Europe, Asia, Pacific, and Latin America Caroline Nguyen visited Sri Lanka in June this year to advance the development of the proposed MCC compact.
The final agreement on the grant programme, which was targeting the transport and land reforms sectors initially, is scheduled to be signed in Washington DC on 17 December this year.
Diplomatic sources in Colombo told The Sunday Morning that the US has still not moved to cancel the grant, but has decided to hold it back until the current political issues are resolved in the country.
No actions are being taken either to move the compact forward or to suspend it while we assess the situation in the country,” MCC has been quoted as saying in a statement to the Associated Press in Washington DC.
MCC stated that it expected Sri Lanka “to remain committed to democratic governance, which includes respect for fundamental freedoms and rule of law”.
On 13 December, 2016, the MCC Board of Directors selected Burkina Faso, Sri Lanka, and Tunisia for new MCC compacts to encourage economic growth and reduce poverty.
According to the MCC, for a country to be selected as eligible for MCC assistance, it must demonstrate a commitment to just and democratic governance, investments in its people, and economic freedom, as measured by third-party policy indicators on MCC’s annual scorecard.
Meanwhile, US State Department Deputy Spokesperson Robert Palladino said last week that the US calls “on the President in consultation with the Speaker, to reconvene Parliament immediately and to allow the democratically elected representatives of the Sri Lankan people to fulfil their responsibility to affirm who will lead their Government”.
We urge all sides to uphold the law and to respect due process,” he added.