The World Bank, San Salvador July 19, 2010
“Central America is a region of tremendous opportunities. I look forward to learning more about Central America’s efforts to deepen regional economic integration, and expand economic growth, while also discussing ways that the World Bank Group can support sustained growth with opportunities for all,” said Zoellick. “I appreciate President Funes’ leadership in hosting this regional integration summit. He’s right to see each country’s success through the lens of the region’s success.“
On July 19, 2010, the World Bank expressed its support for El Salvador with three loans totalling $230 million to promote job opportunities and basic services for thousands of Salvadorans living in poverty. The loans were approved last year as part of the $650 million Country Partnership Strategy 2010-12. World Bank president Robert B. Zoellick said that this particular financing package seeks to support El Salvador through the worldwide economic crisis as it resumes its path of sustained growth with a social emphasis.
“I know that the President and the Minister have worked hard with a fiscal reform to the legislature, and these loans will try to help provide financing for some of those that are poorest and most in need in El Salvador, but also to help build some institutions that will be important for El Salvador’s development,” said Zoellick.
El Salvador’s economy was hit particularly hard by the global economic crisis due to a sizable decrease in foreign workers’ remittances and exports to the United States, El Salvador’s primary trading partner. Extreme poverty in El Salvador was cut in half between 1991 and 2002 (World Bank) and advancements have been made in social services as well, including education and maternal health.
Specifically, the World Bank financing deal includes the following:
- $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 Salvadorans, 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 (World Bank).
This is not the only stop on Zoellick’s trip to Latin America. Zoellick will also participate in the regional integration summit with Central American heads of state July 19-20 prior to visiting with President Felipe Calderon in Mexico July 21-23. Many view this meeting of the Central American Integration System (SICA) as an opportunity to address five main topics: security, social policy, climate change and natural disaster prevention, economic integration, and regional institutionalism. However, gang violence and the controversial return of Honduras to SICA will top the agenda.
Zoellick, Calderon and Mexican officials plan to discuss a wide range of topics including the World Bank’s support for Mexico’s leadership in the region regarding global climate change.
“Mexico is a leading voice on economic and development issues, and we appreciate the strong partnership the World Bank has with President Calderon and the Mexican people,” said Zoellick. “Our work with Mexico on its low-carbon growth strategies and our support to the Clean Technology Fund program to transform urban transportation in five cities shows the depth of this partnership on the critical issue of climate change.“