The Andean Development Corporation (CAF) and Ecuador have signed two loan agreements totalling US$450mn for the country. The first is a loan for the Program to Strengthen Debt Management and Quality of Public Expenditure and the other is for the Social Investment Assurance Program, second phase (PRAISE II).
On the first loan totalling US$250mn, a CAF official says: “the Ecuadorian government has proposed the need for an agenda of specific multiple actions on two fronts: public debt management and improvement of the quality of expenditure on public investment projects which is where this loan is specifically targeted.”
The operation supports the Ecuadorian government’s efforts to execute the agenda, with the aim of guaranteeing the strengthening of public credit management with a view to improving capacities and benefiting proactively from market opportunities, achieving an adequate borrowing profile, at the same time as reducing the interest payments in the budget.
The programme also supports another segment of financial budgetary management which is improvement of the standards of efficiency, transparency and accountability of the budgetary resources assigned to sectional governments and other beneficiaries.
The objective of the other loan for US$200mn is to protect the social investment of the Ecuadorian state in 2006 and 2007, specifically in health and education, giving priority to the underprivileged sectors of society in the framework of the 2006 Social Development Agenda promoted by the Ecuadorian government, to support the achievement of the Millennium Goals.