Unusually high country ownership could leverage results and commitment to reform beyond the compact. Nonpartisan support, ownership, accountability, and responsibility exist for the compact at all socio-political levels. Country ownership beyond the government in El Salvador is evident and palpable. All the Salvadoran stakeholders interviewed touted the country’s ownership of the program and consider it a national priority. Despite the program’s status as one the key initiatives of President Saca, it has fostered multi-party collaboration in the Northern Zone and was approved unanimously in the National Assembly. As Mayor Miguel Angel Rivera of Ciudad Barrios explained, for the first time mayors from Arena, FMLN, and PCN (the major political parties) are meeting and working together to take advantage of the opportunities offered through MCC investments in their respective regions. The MCC presence is not only encouraging stakeholders to share information on how best to organize and help constituents bid on MCA projects but also fostering a sense of shared commitment to raise additional funds for projects that will build upon their infrastructure and human development components.
Increasing flexibility with appropriate accountability could spur implementation. The MCC is taking steps to make requirements less restrictive and more flexible. For example, the MCC has reduced some of the approval and translation requirements for project decisions, and El Salvador is taking advantage of a new MCC policy that allows some procurement to be conducted in native languages, a policy change which has reduced some procurement processing times by 3–4 weeks.[4] This in turn, along with implementing entity agreements in place prior to EIF, should allow contracts to be signed and disbursed more quickly than has been the case in other countries. In the six months since EIF, over $5 million has been obligated in contracts and almost $4 million has been disbursed.[5] It will still be an enormous task to reach the target of $42.8 million disbursed in the first year of implementation—a challenge that El Salvador shares with other compact countries, as all are expected to more than double the amounts previously disbursed by the end of FY 2008.[6] The achievement of such ambitious targets may prove crucial for institutional support by the next U.S. administration, particularly in light of recent congressional machinations to reduce funding.[7]
Building institutional capacity could be the real "MCC effect." The MCC is enabling Fomilenio to compel ministries to fulfill their respective mandates, thus strengthening and capitalizing on existing governmental capacity. The MCC is also helping to strengthen existing ministerial capacity. One example of this in El Salvador is building the capacity for environmental assessment. Although laws exist that govern the evaluation and protection of natural resources and the environment, they are not always enforced. The Ministerio de Medio Ambiente y Recursos Naturales (MARN) has struggled to do so with scarce human and financial resources and with legal title to less than 10 percent of the 118 natural protected areas in existence. One of the compact requirements is the completion of a strategic environmental assessment for the Northern Zone as a precedent for the disbursement of funds.[8] The World Bank provided grant funding to the Government of El Salvador (GOES), enabling MARN to complete this study to meet the MCC requirement which resulted in a Strategic Environmental Assessment. The coordinator of the environmental component of Fomilenio said the compact provided the impetus to prioritize this crucial area.
This is an important sector for El Salvador, as it is one of the most deforested nations in Central America and has seen significant loss of biodiversity due to the civil war and poor management of conservation areas. El Salvador has only 3 percent of its land area protected for conservation, well below the Central America and Caribbean average of 6 percent.[9] This could be an opportunity for increased income through eco-tourism for which the MCC compact is helping to lay the groundwork through pre-design studies and feasibility assessments. These efforts also feed into other donor programs such as the World Bank project for Protected Areas Consolidation and Administration.[10]
As El Salvador wades through implementation procedures and works to get projects underway, there are a few areas in which further progress can be made to smooth the shift to project management.
Next Section: Country Ownership: Recommendations
4. See MCC’s newly released Procurement Guidelines here
5. As of June 30, 2008 these numbers are: 45.9 million disbursed and $53.2 million in compact commitments. See MCC’s quarterly status reports for the latest figures.
6. For more information, see estimates provided (on page 8) by Ambassador John J. Danilovich in his testimony before Congress.
7. See CGD’s analysis of recent events.
8. El Salvador Compact, Annex I-16.
9. WRI Earth Trends.
10. World Bank Protected Areas Consolidation and Administration Project (PACAP).