Sunday, February 1, 2009

Spain Donates $50 Million for Water

The Spanish government gave Guatemala approximately Q380 million for the treatment of water in municipalities that do not have water treatment facilities.

Trinidad Jimenez Garcia, Spanish secretary of State for Latin America, announced at a press conference that the donation is held by the Interamerican Development Bank (IDB) and is to provide piped water to the poorest municipalities. "It's like a gift because it will not be refundable.. It remains under study by the Ministry of Finance to allocate a budget ceiling and to begin investing as soon as possible," said Miguel Angel Ibarra, Vice Chancellor.

The donation includes pipeline projects for water which will be handled by the Fondo de Agua Potable.

The Spanish official also reported a contribution of 8 million Euros for Central America, aimed at improving public safety.

Government Announces Emergency Plan

President Alvaro Colom has put forth his economic emergency plan, which aims to create jobs and revive productivity by providing government programs in the amount of Q6.91 billion. The exact amount of the investment is subject to the approval of loans and the removal of budget locks by Congress.

We should invest Q5.92 billion this year for state investment and employment plus Q1.818 billion for security, said the president, who was accompanied by supporters of the plan. Presentation of the plan took place at the Palacio Nacional de la Cultura.

Erick Coyoy, Deputy Minister of Finance, explained that the amounts stated by Colom are part of the budget for 2009 and not a significant expansion of those resources.

The Programa Nacional de Emergencia y Recuperación Económica (Emergency National Plan for Economic Recovery) includes expenditures in 11 areas, including the generation of jobs through infrastructure projects. The Minister for Communications, Luis Alejos, explained that the funding source for 70 percent of the budget of his ministry are the outstanding loans approved in the legislature. The budget for the Ministry of Communications for the 4th quarter of 2009 was Q4.189 billion for investment in infrastructure. On this subject, Alejos said: "At the moment we don't have the means to pay." However, he is confident that it will not delay the implementation of the plan and projects because the builders cotinue to work with the understanding that between February and April we will be up to date with payments.

The Ministry of Communications is responsible for infrastructure maintenance, road, highway, and bridge construction in Guatemala.

Finance Minister Juan Alberto Fuentes Knight explained that to implement the plan will require redirecting funds in the budget for rural development and the Mi Familia Progresa program.

The Congress has not yet approved six loans for U.S. $1 billion, of which U.S. $500 million must execute in 2009. In addition, the government seeks to eliminate the budget locks that were put in place by Congress in the 2009 budget that prohibit transfers of funds.

The exact amount to be reallocated to the plan is not yet certain, although the deputy minister, Cocoy, said that the amounts mentioned by the president are already integrated into the budgets of some institutions. Cocoy explained that Q3.176 billion will cover works by the Dirección de Caminos y el Fondo de Conservación Vial in addition to Q955 million for FONAPAZ projects.

In the area of social protection an increase to the budget of Mi Familia Progresa of Q1.3 billion is planned, which is why the government seeks to remove the previously mentioned budget locks. Currently the budget for this program is to Q257 million.