Bolivian Municipalities Propose Emergency Social Fund Financed by IMF Loan

The Federation of Municipal Associations (FAM) of Bolivia will propose the implementation of an Emergency Social Fund (FSE) to President Rodrigo Paz Pereira during an upcoming meeting. Johnny Torres, president of FAM and mayor of Cercado (Tarija), stated that the FSE would finance essential projects in infrastructure, sanitation, health, and education across the country's municipalities.

Torres emphasized that the program's core objective is job creation through intensive labor in each municipality, addressing the population's need to work. He indicated that a portion of the recently approved $1.9 billion credit from the International Monetary Fund (IMF) could be allocated to fund the FSE.

This proposal is part of a broader agenda for the meeting, which also includes discussions on revenue sharing (50/50), the 12% share of the Direct Tax on Hydrocarbons (IDH), diesel supply, and the renegotiation of municipal debts with various entities. FAM Bolivia's board and departmental representatives will meet beforehand to consolidate their criteria for the discussions with the president.

The Emergency Social Fund is not a new concept in Bolivia; it was previously implemented during the government of Víctor Paz Estenssoro in 1986 via Supreme Decree 21456. Its original purpose was to mitigate the social costs associated with the economic structural adjustment policies of that era.

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The idea is to use intensive labor in each municipality because the population needs to work.