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Economic programs and the need for a national agenda

By Fundación Flor de Izote, in El Salvador in Perspective, Vol. I no. 4, July-August, 1995

Contrary to the hopes that accompanied the end of the conflict and the speeches of Dr. Armando Caldero'n Sol when he assumed the presidency of the nation, when he said that it would be a consensus-building government, these ideas have remained behind. One example of this is the refusal to give opportunities to civil society to participate in basic aspects which affect the Salvadoran people, such as economic policies, commonly known as "economic plans" and technically called Structural Adjustment Programs (SAP), which, a few months after being implemented, reflect an inflation rate of 10% according to data from the Central Reserve Bank (BCR).

According to FMLN deputy Eugenio Chicas, this is due to the fact that the economic policies of the current government are oriented toward generating a healthy economy from the macroeconomic point of view when compared with the rest of Latin American countries, with the objective of getting recognition from international financial organizations. Therefore, the economic plans are directed at:

This aspect is positive from a macro point of view, but its weakness is that it does not reflect the numbers nor the rate of poverty in the population, thus making this model, or its form of implementation, inhumane, and it would seem that it is intended to generate a large army of the unemployed and a large poverty belt in the periphery of the principal cities. A more tangible example is that in the 70s, the country was 70% rural and 30% urban, and by 1994 one sees 38% in the rural areas and 62% in the urban areas, thus generating the destruction of agriculture and as a result reducing the possibilities of survival in the countryside.

The economic program of ARENA is questionable because it bases its strategy on benefits to the financial system, making it the focus of economic development in the country, without providing an alternative for the poorer sectors. With this focus, Rube'n Zamora warns that despite an awareness of this situation, the government does not want to change the assumptions that would open up the possibility of an alternative economic policy, "ignoring the fact that the social area is a determining factor in the application of any economic program which is developed."

What the current government, in this case Caldero'n Sol, needs to do is to understand and put into practice the idea that the center of development in the country is not the financial sector, but rather the industrial and agricultural sectors. Even if the financial sector continues to be fundamental, this carries with it a series of measures, the first being that the financial sector should be stopped from charging interest rates of 21% and 22% and a series of commissions that raise the real interest rate to more than 25%.

To conclude, the government has rejected the only option that remains, which would be based fundamentally on "the participation of all sectors" according to the thesis of Dr. Roberto Rubio of the FUNDE, which is supported by the assertions of Rube'n Zamora, with regard to the need to "seek a National Agenda which permits the reconciliation of the interests of the financial sector with the other sectors of the country: private enterprise, workers, the government, and political parties."

Derechos de Autor 1995. Fundación Flor de Izote. Esta publicación puede ser reproducida únicamente bajo condición que Fundación Flor de Izote sea citada como fuente.

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