Salvadoran opposition stops loan of 30 million from Spain in Congress

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The opposition Republican Nationalist Alliance (Arena) stopped today in the Congress of El Salvador the ratification of a loan of 30 million dollars offered by Spain more than two years ago to improve infrastructure.

The ratification of the loan only reached 40 votes out of the 84 seats, of which Arena has 35, when it was necessary the approval of at least 56 deputies.

“Many of us agreed that local roads should be made, (…) but we must be responsible,” said Mile Milena Escalón, after the vote, in reference to her party’s position of not approving loans until the government “order your finances.”

El Salvador last year was on the verge of a “default” of its short-term debt and the balance of its public debt exceeds 60% of gross domestic product, according to the Central American Institute of Fiscal Studies (Icefi).

As recently explained by the Minister of Public Works, Gerson Martínez, the loan “has unbeatable conditions” and, in addition, includes a donation of 5.3 million from the Latin American Investment Facility (LAIF, for its acronym in Spanish). English).

On March 23, the general coordinator of the AECID in El Salvador, Ignacio Nicolau, told Efe that “it would be a pity if it were not ratified” because “the conditions are very advantageous”.

He explained that the loan, which comes from the Fund for the Promotion of Development (Fonprode), would be returned to “a fixed interest of 3%, and has 4 years of grace and 25 years of grace”.

Nicolau pointed out that in order to have the LAIF donation, a European Union cooperation tool managed by AECID, it is necessary to approve, previously, the credit offered by Spain and initiate the negotiations with the corresponding entities “so that it enters into force in the deadline, which is May 11, 2017. “

The Internal Regulations of the Salvadoran Congress establish that “if a bill or a resolution does not reach the votes required for approval, it will go to the Archive”.

However, the State body “may agree to know it again or return it to the corresponding commission to be subject to further study.”

Although the AECID in El Salvador has said it will not give a new deadline, the Deputy of the Christian Democratic Party (PDC), Rodolfo Parker, who did vote for ratification, proposed that “a note be written” to Spanish cooperation for “a new extension to the loan is reconsidered”.

Spain is the second country that spends the most money on cooperation projects in El Salvador, only behind the United States.

Between 2014 and 2016, the United States invested in cooperation projects in El Salvador 364 million dollars, Spain 135 million, Mexico 50 million dollars, Taiwan 50 and Japan 20 million dollars.

For Spain, as explained by its ambassador in El Salvador, Francisco Rabena, the three fundamental issues are water and sanitation works, rural roads and security.

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