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Nicaragua to target health spending on vulnerable groups with IDB support

The Inter-American Development Bank (IDB) approved a second loan for $45 million to Nicaragua to improve spending priorities and efficiency on health and social protection for the country’s most vulnerable groups. The reforms carried out by the program will meet the needs of pregnant women and children in the poorest fifth of the nation’s population. 

Over the medium term, improved targeting of resources will result in the provision of comprehensive health services and psychosocial support to some 38,000 families and more than 47,000 children under three years in the poorest communities in 37 municipalities. These actions are expected to reduce the well-being gap in these communities by 15 percent. 

This loan is the second in a two-part policy-based series of operations. As a result of the first operation, which was approved last year for the same amount, the Nicaraguan government adopted a National Policy on Comprehensive Early Childhood. The policy focuses on the comprehensive care of children, including emotional, socio-emotional, physical, and cognitive development in the first stage of life. 

In addition, the Bank financing will help to implement the Master Register of Protagonists in more than 25 poor municipalities. The registry will consolidate information on pregnant women and children under six years to ensure that they receive the care they need. 

"The earlier comprehensive care is provided to pregnant women and infants, the better will be the results from the standpoint of equity and development of their capabilities," said Emmanuelle Sánchez Monin, IDB project team leader. "At the same time, this is the best way to break the intergenerational cycle of poverty at least cost to the government." 

The program will promote reforms that gradually make adjustments in the allocation and distribution of spending on public health and social protection. One goal is to establish a methodology for monitoring social performance to improve budget implementation by the Ministry of Health (MINSA ) and the Ministry of Family, Adolescent, and Child Services (MIFAN). 

This loan will be carried out by the Ministry of Finance with the support of other institutions, mainly MINSA and MIFAN. The IDB financing consists of $22.5 million from the Fund for Special Operations, for a term and grace period of 40 years and an interest rate of 0.25 percent; and a $22.5 million loan from the ordinary capital for a 30-year term, a five-year grace period, and a SCF-Fixed rate of interest.