The disbursement of $277 million for development of the coastal zone will be delayed at least until after the next elections in El Salvador.
The decision to postpone Fomilenio II until 2014 was publicised by the Millennium Challenge Corporation (MCC).
According to the Salvadoran president, Mauricio Funes and the technical secretary of the presidency, Alexander Segovia, the project could be signed after presidential elections next year.
The U.S. Ambassador to El Salvador stressed the need to adopt reforms to laws against money laundering and Public Private Partnerships.
According to the U.S. Ambassador Mari Carmen Aponte, laws against money laundering and Public Private Partnerships need to be passed in order to issue "clear signs" along with efforts to combat corruption in the country.
If approval is not given to the amendments to the Law on Public-Private Partnerships and the Money and Asset Laundering Act, the second disbursement will not be realised.
This was explained by Salvadoran President Mauricio Funes. "Donors are free to stipulate any conditions deemed appropriate. Everything that is the responsibility of the Executive has already been done," he said.
A short-term plan is being prepared to improve the investment climate and lift objections from U.S. Congress to fund the delivery of the Millennium Challenge Corporation
The information was confirmed by the U.S. ambassador to El Salvador, Mari Carmen Aponte. Both governments are working on concrete actions in the short term to allow for these improvements.
In deciding whether to approve Fomilenio II the Millennium Challenge Corporation verifies respect for institutions, good governance, transparency and ethics.
These are, according to Mari Carmen Aponte, the U.S. ambassador in El Salvador, some of the requirements which the country must take into account so that a second Millennium Fund is approved. "The eyes of the U.S.
The government and the Millennium Challenge Corporation yesterday signed an agreement to start the process of installing an office for the Millennium Fund II, whose amount is $2.94 million.
From a press release issued by the Government of El Salvador:
On March 20 an agreement was signed between the Millennium Challenge Corporation (MCC) and the government of El Salvador to start the installation process for the Fomilenio 2 offices.
To obtain a second donation from the Millennium Challenge Account, the country must reach the objectives of the program in the established dates.
The Millennium Funds Program (FOMILENIO), was started in El Salvador in September 12, 2007, with a total donation of $460.9 million, contributed by the United States Millennium Challenge Account (MCA).
The MCA could renew the program when it ends, if all its projects are completed within the established deadlines.