WASHINGTON, December 6, 2011 – The World Bank Board of Directors endorsed the new 2012-2014 Country Partnership Strategy with Honduras that will benefit thousands of poor Honduran families by improving social protection programs and property rights, among other objectives. The Strategy, which also focuses on public safety and macroeconomic management, assigns a total sum of US$171 million.
The Strategy entails projects aimed at “supporting transparency and access to information, such as the modernization of the Financial Administration Integrated System (SIAFI, in Spanish) and the expansion of judicial services, which no doubt will continue to strengthen the efforts carried out by the administration of President Porfirio Lobo to improve the transparency of public finances and public administration,” said William Chong Wong, Honduras’ Finance Minister.
This is also the first time that one of the Bank’s Strategic Partnerships with a country in the region includes support for public safety as one of its pillars.
“Unfortunately, Honduras now has the highest murder rate in the world. This not only has an immediate human and social cost, but also represents an enormous danger for the country’s development potential,” said the World Bank Director for Central America, Carlos Felipe Jaramillo. Because of this, he added, “we have agreed to a strategy with Honduras that includes the reinforcement of public safety as a central objective.”
The other two pillars of this strategy are:
- Increase opportunities y reduce vulnerabilities; including the strengthening of fiscal management, improvements in the investment climate, education and the social protection system.
- Bolstering good governance through projects aimed at State modernization, public resource management, decentralized structures and support for citizen participation.
The Strategy supports the government priority of consolidating the social protection system to reduce extreme poverty. More concretely, the Bank supports the Bono 10,000 Conditional Cash Transfer program that will benefit 30,000 extremely poor families. It also backs efforts to improve the country’s investment climate and productivity, which includes granting new land titles to 50,000 families in rural and urban areas.
Under the budgetary support provided through a US$86 million credit, the government is committed to strengthen the national public safety strategy, deepen the focus on prevention, and development of local efforts. It will include, for instance, the distribution of violence-prevention toolkits in at least 200 schools around the country, as well as the implementation of a comprehensive security plan in at least 10 municipalities in the country’s center, north and east. The Bank will also help build institutional capacities against money laundering and an improved database for crime and violence.
Furthermore, the credit contemplates technical assistance for macroeconomic and fiscal stability. Among its objectives is increasing the number of large taxpayers declaring taxes via the Internet by at least 20 percent.
As part of the Strategy, the Bank’s Board of Directors also approved a second credit to improve public sector performance, worth US$18.2 million. Those funds will help establish, among other goals, a more efficient, effective and transparent public bidding system, increasing the publication of bidding opportunities from 10 to 80 percent.
The World Bank portfolio in Honduras currently includes US$347 million in financing, of which some US$100 million have already been disbursed. These funds have financed highway and road infrastructure projects in urban and rural areas. It is also supporting vulnerable families and youngsters via educational and nutritional investments.
The concessional credits made through the World Bank’s International Development Association have a 25-year maturity period and include a 5-year grace period.
