C# compiler bug? Why doesn't this implicit user-defined conversion compile?

Given the following struct:

public struct Foo<T>
{
   public Foo(T obj) { }

   public static implicit operator Foo<T>(T input)
   {
      return new Foo<T>(input);
   }
}

This code compiles:

private Foo<ICloneable> MakeFoo()
{
    string c = "hello";
    return c; // Success: string is ICloneable, ICloneable implicitly converted to Foo<ICloneable>
}

But this code doesn't compile -- why?

private Foo<ICloneable> MakeFoo()
{
    ICloneable c = "hello";
    return c; // Error: ICloneable can't be converted to Foo<ICloneable>. WTH?
}