The Inter-American Development Bank has approved a $35 million loan to El Salvador for the Urban Communities Solidarity Program (UCS) to increase investments in human capital of low-income and socially excluded families.
UCS is a comprehensive poverty reduction program that supports the Salvadoran government’s strategic plan for implementing its 2010-2014 social policy. The plan includes improvements in nutrition, health, and education services, development of urban neighborhoods, creation of job opportunities, and support for community initiatives to prevent violence.
Recent data indicates that the economic crisis has resulted in increased poverty in El Salvador. The impact has been greatest in urban areas, where the poverty rate in 2008 rose from 29.8 to 35.7 percent.
The IDB loan resources will be used by 25 Salvadoran municipalities to improve nutrition for their citizens. Institutional strengthening for schools will increase educational quality and coverage. In addition, support will be provided for implementing a national early child development model in the poorest urban neighborhoods, and investments will be carried out to improve citizen security.
It is expected that the program will reduce incidence of anemia from 29.4 percent to 20.6 percent. The rate of anemia for pregnant women is expected to fall from 17.2 percent to 12 percent.
In the education sector, the program aims to increase school enrollment by 10 percentage points for children from four to seven years of age and train 80 percent of the teaching staff.
In the area of violence reduction, the program will finance the implementation of “centers for peaceful coexistence” in schools in low-income neighborhoods where students will learn techniques for preventing violence. Creation of the centers is expected to reduce school dropout rates caused by lack of security.
The IDB`s loan is for 25-year term, with a 4-year grace period, at a variable interest rate based on LIBOR.
- Silvia Dangond