Post-War Aid: What Kind and Who Decides?

September 25, 2007

One of the most wide-ranging po-
litical battles unfolding in the wake of
the Salvadoran peace accords concerns
funding for post-war recovery. The
Consultative Group, a coalition of 19
countries and 12 international organi-
zations including the World Bank, the
Inter-American Development bank, the
United States, Canada, Japan, and a
number of European countries, is the
chief providerof aid. The Group pledged
nearly $800 million when it met in
March with representatives of the Sal-
vadoran government, the FMLN, the
peace commission (COPAZ), and la-
bor and non-governmental organiza-
tions (NGOs) at the World Bank's head-
quarters in Washington.
The Bush administration insists that
all funding go directly to the govern-
ment of El Salvador, conditional on the
achievement of consensus on the Na-
tional Reconstruction Plan (PRN).
Drafted by the ARENA government,
the plan was presented to various groups
throughout El Salvador, but was modi-
fied only at the government's discre-
tion. In this respect, U.S. policy to-
wards El Salvador has not changed.
The United States continues to use aid
to legitimize the current government,
one of the principal parties in the con-
flict, rather than institutionalize new
relationships among the country's po-
litical forces. The scheduling of inter-
national aid commitments has also
served to foreclose the process of de-
bate within El Salvador which began
when hostilities ended.
The National Reconstruction Plan
is mainly devoted to capital develop-
ment. Thirty-six percent of the $745
million budget presented in Washing-
ton is designated outright for infrastruc-
ture, as is a further 27% of the budget
within the $324 million category called
"Social Sector and Human Capital
Needs," which originated as a conces-
sion to popular pressure.
The PRN was presented at the
March meeting in Washington in the
context of a review of the ARENA
government's year-old program for
structural adjustment, since the World
Bank considers the PRN "complemen-
tary" to ARENA's overall economic
program. Although the majority of
Salvadorans are now concentrated in
urban areas, the PRN targets the for-
merly "conflictive zones" in an at-
tempt to recuperate governmental con-
trol and reintegrate these areas into
national economic life.
Many of the 108 communities in the
conflictive zones have formulated their
own development plans based on local
community needs, priorities and ca-
pacities. These local initiatives tend to
favor small-scale, independent, com-
munity enterprises which differ pro-
foundly from the neo-liberal and ex-
port-oriented agro-business model at
the core of the ARENA program. Some
grassroots projects were incorporated
into the PRN, but they comprise a small
percentage of the total budget. Further-
more, the government made no com-
mitment to involve the NGOs which
work with these communities in carry-
ing out these projects.
The Salvadoran government prefers
to channel aid via the municipal admi-
nistrations, whose office-holders be-
long overwhelmingly to the ARENA
party. Many local mayors have had no
relations until now with the communi-
ties designated in the PRN and will find
this opening useful. Local communi-
ties and opposition sectors view mu-
nicipal officials with suspicion because
they represent outposts of national au-
thority and, in the past, government
The government plan rejuvenates
"Municipalities in Action" (MEA), the
U.S. AID program of the mid-1980s.
MEA was the civilian version of previ-
ous military-run counterinsurgency
"civic action" projects. Through MEA,
local mayors bought support by financ-
ing small-scale projects to build infra-
structure and to provide for other basic
needs. Similarly, the ARENA govern-
ment hopes the PRN will enable it to
cultivate political support in the con-
flictive zones in time for the 1994 elec-
Mimi Hurd is afreelance writer based
in New York.
VOLUME XXV, NUMBER 5 (MAY 1992) 9An Inauspicious Beginning
Santa Marta was selected as a prom-
ising pilot project for post-war recon-
struction months in advance of the peace
accords. This town of 3,000 is one of
many communities of repatriates who
survived years in Honduran refugee
camps after being driven from their
villages by the military. The commu-
nity organized its return to the north-
central region of Cabafias not long ago.
U.S. Ambassador William Walker's trip
to Santa Marta in June of 1991 was the
first visit of a U.S. government official
to a "liberated" community. Walker,
accompanied by Cong. Joe Moakley,
U.S.AID officials and the local ARENA
mayor, opened discussions with town
leaders about community needs. The
possibility of giving U.S. AID funds
directly to the NGO representing the
community was discussed, but Ambas-
sador Walker said that aid must be
channeled through the local municipal-
With the help of NGOs and a tech-
nical assistance team contracted by
them, Santa Marta drew up plans for
20 inter-related projects for increased
agricultural production, crop diversi-
fication, storage facilities, transporta-
tion enterprises, artisanal and mechani-
cal workshops, revitalization of former
bakeries and dairies, marketing, and
small-scale industrial production.
These projects are designed to enable
9,000 people in the area to become
economically productive and self-suf-
A leather-tooling cooperative in Ciudad Segundo Montes, a repopulated town in an FMLN-controlled zone. The National Reconstruction Plan
U.S.AID agreed to provide admin-
istrative funds to develop these projects,
and also delivered $20,000 to the local
mayor's office in January, with the un-
derstanding that the initial projects
agreed upon with the community-road
construction and electrification along
various stretches between Santa Marta
and outlying communities-would be
completed by February. As of early
April, just three kilometers of highway
had been laid and posts for electrical
wire had been planted only within the
town itself. Trees in the town that the
community had specifically asked to be
preserved were felled in the process.
This inauspicious beginning may mean
that Santa Marta is turning out to be a
truer model of post-war reconstruction
than anyone intended.
International Monitoring
At the March meeting in Washing-
ton, the Consultative Group strongly
recommended putting two conditions
on the PRN. First, the Group called on
the government to give priority to the
PRN's "Democratic Strengthening Pro-
grams" this year, rather than deferring
them. Fifty million dollars over and
above the original budget was allocated
for that purpose. Secondly, the Group
required the Salvadoran government to
comply with stringent accounting pro-
cedures and to submit to an indepen-
dent audit by an international firm. The
U.S. Congress also wrote into law an-
other oversight mechanism.
How the PRN is finally carried out
will be an important indicator of whether
the peace accords' promise of political
and economic change can be realized.
Given the experience of Panama and
Nicaragua to date, El Salvadormightbe
considered lucky to receive significant
reconstruction funds of any kind. Yet it
is possible that aid aimed at supporting
the Salvadoran government may only
aggravate the dire social conditions at
the root of the country's turmoil.
The PRN is also a test for Washing-
ton. A RAND corporation report issued
on the day of the signing of the accords
in Mexico declared U.S. policy toward
El Salvador a failure. The implementa-
tion of the PRN will test Washington's
ability to change course and its toler-
ance for real social change in both the
economic and political spheres.

Tags: El Salvador, Peace Accords, foreign aid, national reconstruction

Like this article? Support our work. Donate now.