El Salvador’s opposition blocks financing for crucial government programs

News

On Thursday, October 23, representatives from El Salvador’s right-wing opposition party, the Nationalist Republican Alliance (ARENA), walked out of the legislative plenary, effectively shutting down the parliament, in order to block the approval of $600 million in international loans and the passage of the 2015 National Budget. “ARENA [is] trying to bankrupt the country…they want to leave the state without financing,” said legislator Antonio Echeverría of the governing Farabundo Martí National Liberation Front (FMLN) party.

Over the past months, the executive negotiated 11 loans from international lenders to finance initiatives in violence prevention, tourism, education, labor, productivity and infrastructure that require a two-thirds majority approval in the Assembly. But an ongoing boycott by ARENA legislators has left the loans languishing, and two loans from the Inter-American Development Bank (IDB) expired without approval on Friday, October 24, despite efforts by the FMLN to convene an emergency legislative session. The government has suggested it will request an extension from the IDB.

Meanwhile, the 2015 National Budget proposal is up for debate in the Legislative Assembly. The budget, presented by the executive, includes increases in financing for healthcare, education and security based on increased state revenue thanks to recently passed tax reforms. “It’s a budget adjusted to the reality, it is austere and balanced,” said President Sánchez Cerén. But ARENA is already objecting to the proposal, paradoxically calling for austerity while criticizing proposed decreases in other areas.

IDB representatives recently praised the FMLN administration for its fiscal responsibility and financial management; nevertheless, ARENA has demanded austerity measures from the government in the form of a Fiscal Sustainability Law in exchange for their approval of the loans and the budget. All parties have agreed to discuss three proposals for such a law—from ARENA, the FMLN, and the previous Funes administration—on November 17, but ARENA’s boycott continues.

FMLN legislator Lorena Peña, president of the Assembly’s Treasury Commission, dismissed ARENA’s arguments: “After all of the theft that [former] ARENA [administrations] committed, it’s logical that the citizenry has debt. We paid for the Maternity Hospital twice, because the first loan was stolen, [as was] the money for the Diego de Holguín [highway]…I want to emphasize that if we don’t approve these loans, we are damaging concrete projects that are going to bring employment and economic growth to the country.”

ARENA’s actions appear to form the latest plank in their ongoing campaign to destabilize the nation and undermine successful leftist governance, while the FMLN administration works to expand the successful social programs and democratic initiatives that brought the party into office for a second consecutive term in 2014.

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