Wednesday, July 21, 2010

World Bank loans $230 million to El Salvador for social programs

Earlier this week, the World Bank and El Salvador signed a $230 million loan package. According to the World Bank statement about the loans, the money will support programs in three areas:

The loan package has been designed to prop up key areas of El Salvador’s economic and social tissue as the economy shifts gears to resume growth and continues to spur opportunities for all its citizens. Specifically, the financing deal breaks down as follows:
  • $100 million ‘Sustaining Social Gains for Economic Recovery Development Policy Loan’, to support the country’s recovery through sound economic and social policies that address the needs of Salvadorians, particularly the most vulnerable, by protecting its income and consumption, and ensuring its access to health services.

  • $50 million ‘Income Support and Employability Project’ to provide temporary income support to the urban poor under the ‘Programa de Apoyo Temporal al Ingreso’ (PATI) which provides a monthly income transfer to targeted individuals in exchange for their participation in community activities and in training programs.

  • $80 million ‘Strengthening Local Governments Project’ to buttress local governments, considered critical to provide essential basic services for the people (water and sanitation, electricity, street lightning, public infrastructure) and at the same time create new jobs in all 230 municipalities.

The World Bank has been supporting President Funes’ administration through a combination of instruments, including lending (both budget support and investment), analytical work, and policy dialogue and advice.

Also on the World Bank web site is a 99 page document titled the Country Partnership Strategy for El Salvador dated October 29, 2009. This detailed document is filled with a great deal of information. Regardless of whether or not you agree with the pro-market economy focus of the World Bank, there is much to learn in its tables and charts.

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