El Salvador: Status of Reconstruction Activities One Year After the Peace Agreement

GAO discussed the reconstruction of El Salvador, focusing on: (1) its national reconstruction plan (NRP); (2) reconstruction funding; (3) nongovernmental organizations' (NGO) participation in reconstruction; (4) its Municipalities in Action Program (MEA); and (5) land redistribution. GAO noted that: (1) the Salvadoran government and the Farabundo Marti Liberation Front (FMLN) are negotiating their differences on NRP content and funds allocations on a case-by-case basis; (2) the government has allocated reconstruction funds to NGO regardless of their former affiliations based on the type of activity and the merit of individual projects; (3) some critical programs, such as public safety and land distribution, are underfunded due to increased costs, limitations on the use of funds, and some donors' reluctance to provide funds until the government and FMLN have demobilized; (4) development banks have arranged loans for projects, but attempts to get additional funds from donors have been unsuccessful; (5) the working relationship between the Salvadoran government and NGO has improved and more NGO are participating in reconstruction projects, although few former FMLN-affiliated NGO receive direct government funding; (6) MEA is the main program for local assistance and democracy promotion and appears to be a democratic and efficient program; and (7) the land redistribution program is in jeopardy because land transfers are behind schedule due to disagreements and lack of resources, recapitalization of the land bank is doubtful, and agricultural credit is inadequate.