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IDB supports decentralization and fiscal policy in Bolivia
Bolivia will support the process of decentralization and fiscal policy with a $20 million loan approved by the Inter-American Development Bank (IDB).

This project aims to assist in the fiscal decentralization process by designing and updating the regulatory framework and strengthening the institutional framework in a way that ensures the sustainability of public finances. It will also help the central government in its relationship with subnational governmenst, by defining an appropriate action plan to enhance a more effective, efficient and transparent public finance management.

As a whole, the measures in the policy matrix will help develop a new regulatory framework for autonomous entities, in line with the medium-term fiscal balance target and subnational fiscal responsibility, as well as a more efficient and effective coordination between the central government and subnational governments, strengthening the capacity of the state in managing its fiscal policy.

Under the program, the IDB is providing technical assistance in order to support the government's efforts to update the regulatory framework for fiscal decentralization.

The IDB financing includes a $14 million loan from the ordinary capital, for a 30-year term, a 6-year grace period and an interest rate based on LIBOR. The $6 million credit from the Fund for Special Operations is for a 40-year term and grace period and an interest rate of 0.25 percent.