Congress has approved a loan from the French government to finance the construction of the water treatment plant in Las Pavas.
From a statement issued by the Legislative Assembly of El Salvador:
With the aim of finalising the funding for the "Project for the Renovation of a Drinking Water Treatment Plant in Pavas and Network adduction", representatives of the Legislative Assembly approved a financial protocol between the governments of France and El Salvador, for an amount of € 53 million (US $59 million).
Salvadorans Unions are opposed to the purchase of unrated debt using capital from the Pension Administration Fund.
The Committee to Defend Workers Pension Funds believes that they will start to purchase fraudulent bonds in order to repay the debt of an institution which, since it started the program "Housing for Everyone" has administered in an "impaired" fashion, the funding for this initiative.
The Law on FONAVIPO Investment Certificates exempts the institution from registering as a securities issuer and from rating the risk of its bonds.
The Law passed a few days ago bailsout the Fondo Nacional de Vivienda Popular (Fonavipo).
... "The measure contradicts the current Law on the Pension Savings System, indicating that AFP's can not acquire financial instruments which are "low grade", as is the case of FONAVIPO securities to be issued since July, with the institution being graded by Fitch Ratings as "D" with low ability to pay ", reported Elsalvador.com.
The Government, via the National Fund for Housing, has relaunched a special revolving credit line and contributions to rebuilding homes in cases of emergencies.
A press release from the Presidency of the Republic of El Salvador reads:
FONAVIPO has made available through authorized institutions $ 7 million, with interest rates of 5.5% and 6.5% over 10 and 25 year terms for families whose incomes do not exceed four times the minimum wage.
Despite some signs of recovery, mainly in public works, the industry continues to stagnate, as shown by credit indicators for construction.
Between January and May 2011, banks lent $7.4 million for housing projects, 73% less than in the same period last year, when loans were for $27.7 million.
With regard to house buying, the situation is totally the opposite.
FONAVIPO will take over private building projects that have had to be stopped due to lack of funding.
More than 2 000 public houses will be developed by the National Fund for Popular Housing in different areas of the country.
They will be built on lots where private developers had begun construction of buildings, and therefore already have building permits and other documents required by regulation.
The National Popular Housing Fund gave the order to begin construction of the Santa Lucia and Procavi developments in the city of Santa Ana.
The Santa Lucia project consists of 1.068 apartments, divided into 57 buildings on three levels. To date the fund has awarded the construction of the first 16 buildings -192 apartments - to two companies. For the rest of the development, FONAVIPO will receive bids from firms on 6 May.
The lack of clean water and sanitation creates pollution problems and limits development of coastal areas.
The absence of adequate sanitation infrastructure increases investment costs for coastal development in up to 10%, forcing to arrange for the supply of drinking water and to build water treatment plants.
Alberto Ascencio, president of the Salvadoran Hotel Association, points to Laprensagrafica.com: "Here in the country we speak about tourism development but we really do not have the basic needs in those destinations we promote at a regional or international level."
Changes to the tender process of program “Housing for All” ("Casas para Todos") eased up on requirements for construction companies.
Current legislation requires the contractor to have developed at least three similar projects to the one which is being applied for. With the new changes construction companies can apply without having been specifically devoted to urban development projects.
Out of $ 99 million in loans it is estimated that 53% will be invested in new housing.
The trend over recent years has been the purchase of used housing, according to Thomas Chévez of the Social Housing Fund (FSV).
"The balance that could be achieved regarding the trend is because in 2011 the supply of new housing, specifically of social interest, will increase due to construction projects from the program “Casa para todos,” reports the article in Laprensagrafica.com.
The National Housing Fund will start in the coming days the bidding process for 3 condominium projects.
From Friday 26th to Monday 29th the bidding will begin on a 1,068 residential apartment project in Santa Lucia and one of 416 units in Procavi. The first is valued at $ 16 million and the second at $ 7 million.
Both are part of "Home for All", which is funded with $ 50 million provided by the Central American Bank for Economic Integration.
BCIE and IDB funds will finance the "Casa para Todos" (Housing for Everyone) program.
The $ 70 million Inter-American Development Bank loan will go to build 6.373 homes for low-income families, of which 2.000 would be ready by March 2011.
The credit of the Central American Bank for Economic Integration (BCIE), of also $ 70 million, "will be implemented by the National Housing Fund (FONAVIPO), which will bid the affordable housing projects to developers," Elsalvador.com reported.
El Salvador's 'Casa para Todos' scheme supported by president Mauricio Funes will be relaunched on 9 September with five new projects.
With financing coming from the People's Housing Fund (Fonavipo) and the Social Housing Fund (FSV) the five new projects will provide 942 homes for which construction is expected to be completed by the end of 2011.
"President Funes explained that Fonavipo will be leading the works in which around $80 million will be invested, creating 45,000 new direct and indirect jobs in the construction sector, the one most seriously affected by the economic crisis," reports Elmundo.com.sv.
The stimulus activities undertaken by private constructors in the first half of the year resulted in mild recovery signals by June.
Mario Rivera, president of the Salvadoran Construction Chamber (CASALCO), commented that despite this mild recovery, the sector urgently needs public investment in infrastructure projects.
He also noted that some 2.500 jobs were added in the past six months.