El Salvador’s Legislative Assembly has taken a crucial step for the country’s economy by issuing two favorable opinions authorizing the government to sign two major loans with the International Bank for Reconstruction and Development (IBRD). These financial agreements total US$350 million, divided into one for up to US$250 million and a second for up to US$100 million, both of which seek to strengthen the fiscal sustainability and resilience of the Central American country.

The approved funds are intended for the implementation of key programs, such as the “Development Policy Loan for Fiscal Sustainability and Resilience in El Salvador”. This program has a term of up to 30 years, including a grace period of up to five years, allowing the government to maintain long-term financial management. The initiative underscores the importance of ensuring sound macroeconomic policy, attracting private investment, and generating quality employment.

These financial resources are not only focused on fiscal stability, but will also allow the country to strengthen its response capacity to various emergencies. Due to its geographic location, El Salvador is prone to risks such as hurricanes, tropical storms, and earthquakes, in addition to health hazards. Therefore, having these financial tools is vital to effectively manage any contingency.
According to the proposal, a portion of these funds can be immediately mobilized in times of crisis to finance response and recovery operations. The primary objective of this is to “minimize the fiscal impact” of catastrophic events and allow for rapid response to their adverse effects. The flexibility of these resources is essential to maintaining economic stability in emergency situations.

Marlon Herrera, representative of the Ministry of Finance, emphasized that this authorization by the IBRD is not only an economic agreement, but also represents recognition of the disaster management strategies implemented by the Ministry of the Interior and the Civil Protection Directorate. This validates the government’s actions in emergency prevention and response, demonstrating the confidence of international organizations in the current administration.