United Nations

A/50/534


General Assembly

Distr. GENERAL  

26 October 1995

ORIGINAL:
SPANISH


Fiftieth session
Agenda item 20 (b)


STRENGTHENING OF THE COORDINATION OF HUMANITARIAN AND DISASTER
RELIEF ASSISTANCE OF THE UNITED NATIONS, INCLUDING SPECIAL    
ECONOMIC ASSISTANCE:  SPECIAL ECONOMIC ASSISTANCE TO INDIVIDUAL
COUNTRIES OR REGIONS

International assistance to and cooperation with the Alliance
for the Sustainable Development of Central America

Report of the Secretary-General


I.  INTRODUCTION

1.  The  present report is submitted pursuant to General Assembly resolution
49/21 I  of 20 December  1994.   It describes the  international cooperation
activities  implemented since January  1995 in  support of  the Alliance for
the Sustainable  Development of Central  America, following the  conclusion,
on 31  December  1994,  of  the mandate  of  the  Special Plan  of  Economic
Cooperation for Central America.

2.   In its resolution 49/21 I, the General Assembly  emphasized the need to
design  a new  programme of  international cooperation  for Central America,
based on the priorities laid down in the Declaration of Commitments  adopted
by  the  Follow-up  Committee of  the  International  Conference  on Central
American  Refugees  (CIREFCA)   and  in  the  new  subregional   development
strategy, the Alliance for Sustainable Development  of Central America.  The
Assembly  expressed  support  for   the  efforts  of  the  Central  American
Governments in their commitments to the  alleviation of extreme poverty  and
the fostering of sustainable human development,  and urged them to intensify
the implementation  of policies and programmes  in those areas.  It stressed
the need for the  international community to continue  its support for those
efforts,  and requested the  United Nations  system and,  in particular, the
United  Nations Development  Programme  (UNDP) to  continue  to  provide the
necessary support and to mobilize resources in order to meet the  objectives
of the new strategy for development in Central America.



95-30447 (E)   261095  271095/...
*9530447*
3.  Resolution 49/21 I ushered in a  new phase of international  cooperation

with Central  America,  following the  conclusion  of  the Special  Plan  of
Economic Cooperation for Central America.   The General Assembly had adopted
the  Special  Plan  in response  to  a  request  from  the  Central American
Governments  to  promote international  cooperation  in  support  of  peace,
democratization and  development in Central America.   The  Special Plan was
launched in  September 1988, pursuant  to General Assembly resolution 42/231
of  12 May 1988, for an  initial period of  three years (1989-1991).  By its
resolution  45/231 of 21  December 1990,  the General  Assembly extended the
mandate for  an additional three years  (1992-1994). This  report will refer
to  certain  activities  under  the  Special   Plan  which  continue  to  be
implemented, although  they have been adapted  to the  current situation and
to the new priorities established for the subregion.

4.  While this report focuses on the Central American isthmus, comprised  of
Belize, Costa  Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama,
it  also covers some  activities in support of  refugees which include parts
of southern Mexico.


II.  THE MACROECONOMIC FRAMEWORK

5.    According  to  the  Economic Commission  for  Latin  America  and  the
Caribbean  (ECLAC),  a  number  of  factors,  both  positive  and  negative,
influenced  economic  developments  in 1994  and had  short-term  effects on
stabilization efforts.  A  measure of uncertainty, the  level and nature  of
which varied by country,  had an impact on the decisions of economic  agents
and  on economic  activity.   In Nicaragua, the  climate of  tension arising
from  the  internal political  dispute persisted,  while Guatemala  felt the
effects  of  the  obstacles  imposed  by  the  confrontation  between  State
authorities  and   by  the   Government's  difficulty   in  implementing   a
significant fiscal  reform to  place State  finances on  a sounder  footing.
Another  factor  in  several countries  was  the  transition  occasioned  by
constitutional  changes  of  government.    Although  the  new   authorities
continued    to    emphasize   macro-financial    stabilization,    economic
liberalization  and  institutional  modernization,  the  measures  taken  to
achieve those ends met with serious difficulties in the short term.

6.   Public finances  in the  subregion deteriorated  considerably as  Costa
Rica suffered  a severe  fiscal crisis,  while Honduras  and Nicaragua  made
strenuous efforts to control serious budgetary  imbalances.  The position of
El  Salvador and Guatemala  was more  favourable, owing  to their relatively
moderate fiscal  deficits, although Guatemala suffered some setbacks in this
regard.  Panama's central  Government saw a slight rise in its deficit which
represented  only  0.8  per  cent  of  its  gross  domestic  product  (GDP).
Belize's fiscal situation improved  as its deficit fell  from 6 per  cent of
GDP in 1993 to just over 2 per cent in 1994 owing to a reduction in  capital
outlays.   Costa  Rica and  Honduras  witnessed  a resurgence  of inflation,
partly because of severe fiscal and  monetary imbalances and the realignment
of  their exchange-rate  parities.  In  contrast, prices in  El Salvador and
Nicaragua  rose more slowly  than in  1993. Panama  maintained low inflation
indexes (1.3  per cent for  consumer prices and  2.1 per  cent for wholesale
prices),  while Belize's  index  rose,  though it  remained relatively  low.
This situation  was also affected  by the  severe drought  that hit  several
countries of  the subregion, which  reduced agricultural output,  aggravated
the  already chronic  energy  crisis and  generated  inflationary  pressures
stemming from the scarcity of staple foods.

7.  One positive factor  was the improvement in the terms of trade beginning
in  the  second half  of  the  year,  owing primarily  to  the  increase  in
international  coffee  prices and,  to a  lesser degree,  the rise  in sugar
prices.    Although  low  levels of  coffee  bean production  and  the usual
practice  of  advance  sales  did  not  allow  the  countries to  take  full
advantage of the price boom, extra  earnings from these exports  constituted
a  significant  injection  of  resources  that  helped  to  temper  economic
difficulties and  to  brighten the  outlook  for  economic activity  in  the
subregion.   The upswing  in export  earnings slightly  reduced the current-

account deficit  of the  balance of  payments of  the five Central  American
countries and  slightly increased  international reserves,  even though  net
capital investment  from abroad  was lower  than in  1993.   Panama's  trade
balance ran  a small  deficit, but its  situation with  respect to  external
payments  was relatively  comfortable owing  to  the  expansion of  both the
international banking  centre  and its  national banking  system.   Belize's
balance  of payments was  buoyed by  strong agricultural  exports, while its
reserves were eroded more slowly in 1994 than in 1993.

8.    Cooperation  mechanisms  among the  Central  American  countries  were
strengthened  in 1994, and  the negotiation  of trade  agreements with third
countries  was intensified, though  it showed  uneven progress.   Costa Rica
concluded  a free trade  agreement with  Mexico, which came into  force on 1
January 1995,  while other countries began  to negotiate similar  agreements
with that country.   It was possible  to coordinate trade negotiations  with
Venezuela and Colombia, as well as  with various regional and extra-regional
forums.

9.   As for production, a  decline in Honduras (of 1.4 per cent) and a slow-
down  in Costa Rica  (from 6.1  per cent  in 1993 to  4.5 per  cent in 1994)
resulted  in more  modest economic  growth in  Central America,  as both  El
Salvador and  Guatemala showed levels very similar to those of the preceding
year, while  Nicaragua experienced  a significant recovery  (3.2 per  cent).
Central  America's GDP rose  by 3.6  per cent, compared to  5.5 per cent and
4.9 per  cent in  the preceding  two years.   In  any case,  per capita  GDP
increased, albeit only slightly.  In  Panama, economic activity expanded for
the fifth  year in a row (by  4.7 per cent), thereby recovering the level of
per capita GDP  recorded prior to the crisis of 1988.   Belize, in contrast,
saw  its economic  growth rate  decline for  the second  year running  as  a
result of its fiscal adjustment.

10.   Economic performance reflected  the combined effects  of a variety  of
factors.   In particular,  gross fixed  capital formation  slowed down after
having  gained  considerable momentum  in  previous  years.    Except in  El
Salvador, where  it continued to climb  rapidly (by 12.1  per cent, compared
to 14.7 per cent in 1993), the growth rate of investment slowed sharply;  in
Costa  Rica, it  fell from  19.6 per  cent to 3.4  per cent  as a  result of
monetary  and  financial  disturbances  and  the  reduced  availability   of
external resources.  Efforts to curb  public expenditure in Honduras  caused
investment to stagnate (0.3  per cent, compared  to 18.2 per cent in  1993).
In  Guatemala,  private investment  shrank  by  4.6  per  cent after  having
expanded by 8.6 per  cent in 1993, while  the recovery of  public investment
in Nicaragua was insufficient to keep  total capital formation from  falling
for the second year in  a row.  Gross domestic investment in Panama rose  by
7.3 per cent, though this  rate was lower than those recorded earlier in the
decade.  In Belize, public investment declined under the adjustment policy.

11.   The agricultural sector was hard  hit by the  drought that plagued the
subregion, causing sharp declines in the  production of basic grains (maize,
beans, rice and sorghum) and prompting  the adoption of government  measures
to support  producers and grain  imports to  build up stocks.   Agricultural
output shrank in El Salvador and Honduras,  but Nicaragua managed to salvage
its  "late" harvest.  Panama's  banana and coffee crops  improved over their
1993 levels, and agricultural activity in  Belize (sugar, citrus fruits  and
bananas) was brisk in 1994.

12.   The insufficient rainfall  accentuated the  subregion's energy crisis.
The short  supply of water  in reservoirs reduced  the capacity  to generate
electricity, necessitating  strict water  rationing  in Honduras,  Nicaragua
and, towards the end  of the year, Guatemala.   Power plants  generated more
electricity  from thermal  sources,  with  a consequent  rise in  production
costs.   The  impact of  the  crisis on  economic activity  was particularly
intense in Honduras  and, to a lesser  degree, in Nicaragua.   Manufacturing
activity expanded  at a somewhat slower rate in Central  America, inter alia
as  a  result of  a  slow-down in  Costa  Rica and  a  decline in  Honduras.
Panama's manufacturing industry also shrank  pending the outcome of proposed

changes in  fiscal and  tariff  policies.   In Belize,  however, the  sector
expanded in  1994, given  its linkage  to agricultural  activity.   Although
tourism in Belize increased only slightly,  the sector's gross earnings grew
by 3 per cent, exceeding the value of merchandise trade.


III.  IMPLEMENTATION OF COOPERATION ACTIVITIES

13.  In 1994, the United Nations Development Programme  (UNDP) decided, with
the   agreement  of   the  Central  American  Governments,   to  assign  the
outstanding  balance  from  the  Special Plan  of  Economic  Cooperation for
Central  America to finance  some activities  aimed at the  preparation of a
new programme  for  the Central  American  subregion.   Formulation  of  the
programme  is  based  on priorities  and  undertakings  established  by  the
Presidents of  Central America at their recent summit meetings, particularly
the  International Conference on  Peace and  Development in Central America,
held  in  Tegucigalpa   on  24  and  25  October  1994.  It  also  reflected
commitments made by the participants  in the CIREFCA with respect to solving
the problem of  uprooted populations  and the  eradication of  poverty.   In
preparing  the   programme,  UNDP   established  contacts  with   government
authorities  and  cooperation  agencies,  regional bodies,  non-governmental
organizations  and various  United Nations  agencies, in  order  to identify
programme priorities  and start  mobilizing resources  for implementing  the
programme.

14.  The  programme seeks to promote the  consolidation of peace in  Central
America by  supporting the Alliance for  Sustainable Development in  Central
America.  It focuses on three main areas:

   (a)  Peace and governability;

  (b)  Economic and social development;

  (c)  Sustainable development of the environment.


IV.  PEACE AND GOVERNABILITY

A.  Support for the processes of consensus-building and
    strengthening of democratic institutions          

15.    The  subprogramme  deals  with   problems  directly  related  to  the
consolidation  of  peace  in  the  context  of  governable democracies,  and
supports  implementation   of  the   agreements  for   peace  and   national
reconciliation.

16.   The  role of  UNDP, which  operates  through  its country  programmes,
includes support  for the activities  of consensus-building  forums and non-
governmental organizations, promotion  of human rights and strengthening  of
judicial and electoral systems in different countries of the subregion.

17.  With respect to consensus-building  forums, in Nicaragua, for  example,
UNDP acts as  technical secretariat for the Support  Group which is made  up
of representatives from  Canada, Spain, Mexico, the Netherlands and  Sweden.
The  Support Group  held intense  discussions with  Nicaraguan  participants
(business,  labour,   religious  and   academic  leaders,   non-governmental
organizations,  local authorities,  the  media, political  leaders  and  the
national Government) with a view to  promoting a comprehensive agreement  on
Nicaragua, institutionalization  of the  dialogue  between public  officials
and civil society, in order to  ensure democratic governability, and support
for the establishment of a national development strategy.

18.  In  Guatemala, UNDP  participates in  the forum  of representatives  of
countries  belonging  to the  Group  of Friends  of  the  peace  process and
supports dialogue with the business sector  and with those participating  in
the Assembly  of Civil Society.  In Honduras, cooperation is maintained with

the Convergencia Nacional forum.  In  Costa rica, a Youth Forum  was held in
1994 with the  support of UNDP  to encourage  active participation of  young
people in the work  of the nation, and  a national dialogue  was facilitated
between Costa  Rican business groups and  trade unions.   Similarly, support
was given  to the  Chamber of Exporters  for the organization  of the  Costa
Rican Forum 2020,  aimed at  projecting an objective  image of the  country,
with the participation of wellknown national figures.

19.  The  subprogramme includes a  new project designed  to help  strengthen
regional and national non-governmental  organizations by providing  training
and  facilitating  their considered  and  purposeful  participation  in  the
processes of dialogue and consensus-building  in society.   The subprogramme
also  will  provide  support to  bodies  and  organizations  responsible for
coordination and joint regional efforts.

 20.   With  regard to  the  restructuring  and strengthening  of democratic
institutions, support  is being given to  the areas  of involvement targeted
by  the  country programmes  of  UNDP  and  other  United Nations  agencies.
Technical  cooperation  currently is  being  extended  to  strengthen  human
rights  institutions  (such  as  human rights  prosecutors  in  El Salvador,
Honduras and  Guatemala),  the civilian  police  in  El Salvador  and  State
institutions  under   the  Comprehensive  Agreement   on  Human  Rights   in
Guatemala,  which resulted in  the establishment  of a  Joint United Nations
Mission for  the Verification  of Human  Rights and  of Compliance  with the
Commitments of  the Comprehensive  Agreement  on Human  Rights in  Guatemala
(MINUGUA)/UNDP Unit.   Assistance  was provided  to the  Commission for  the
Consolidation  of Peace (COPAZ)  in Guatemala and is  now being furnished to
the  new Office for Peace, Development and National Reconciliation (SECPAZ).
In  Nicaragua, UNDP  is participating  in the  programme for  the reform and
modernization of  the  public sector  (together  with  the World  Bank,  the
InterAmerican  Development  Bank  (IDB) and  the  United  States  Agency for
International  Development (USAID),  and a  project designed  to  streamline
formalities relating  to property ownership - for which US$ 3.6 million have
been allocated  - has been launched, with a view to removing one of the main
obstacles to progress in the country.  In Costa Rica, the National  Congress
on Justice held in  1994 resulted in a  modernization plan, currently  under
way, which is being financed by the judiciary and IDB.

21.     Another basic  theme of  the regional programme  is support  for the
economic   and  social  reintegration  of   former  combatants,  demobilized
military  personnel  and  wounded  victims  of  war  and  conflicts  in  the
subregion, who are covered by specific peace agreements.   UNDP is providing
support  to  implement  those  agreements,  for  example,  in  El  Salvador,
Nicaragua and Guatemala, and projects for  each country have been  submitted
to, and have received  the support of, the  international community, both in
advisory  groups  coordinated by  the  World  Bank  and  in other  resource-
mobilizing forums.   The  topic is  dealt with  in the  broader coverage  of
uprooted populations included in the next section. 

22.   In Guatemala,  support is  being given to a  programme focusing on the
identity and  rights of  indigenous  peoples,  the purpose  of which  is  to
establish the  analytical and institutional  foundations for the  subsequent
promotion of  more  far-reaching  long-term  reforms.    The  programme  was
developed on  the basis  of the commitments  contained in  the Agreement  on
Identity and Rights  of Indigenous Peoples (A/49/882-S/1995/256, annex)  and
underscores the  cultural aspects and legal  reforms that  affect the rights
of indigenous peoples.


B.  Sustainable human development at the local level

23.   This subprogramme was  established in  response to the  Declaration of
Commitments  in  favour  of populations  affected  by  uprootedness  and  by
conflicts  and extreme  poverty in  the  framework  of the  consolidation of
peace  in  Central America  adopted  by  the  third  and last  International
Meeting of  the  CIREFCA Follow-up  Committee held  in Mexico  City in  June

1994, and the follow-up machinery established  in Guatemala City in November
1994.   It should  be noted that  the Central American  Governments, at  the
International  Meeting  in Mexico  City,  stated  that progress  towards the
consolidation  of peace  in the  new context  of the  subregion and  towards
ensuring continuity  in the treatment of  uprooted populations  called for a
shift in  the orientation of emergency  programmes towards  a stage focusing
on strategies  for sustainable human  development in  areas or on  behalf of
populations assigned priority by the countries  concerned. To that end, they
undertook to pursue sustainable human development  policies and to focus  on
priority areas  in which  problems of  uprootedness were  compounded by  the
highest rates of  extreme poverty, social  exclusion, conflict situations or
severe deterioration of the environment.

24.   The mechanism adopted  at country level  is the  National Coordination
and Support  Group (GRUCAN),  a body  open to  all parties  concerned and  a
framework for  follow-up to  the  activities and  initiatives undertaken  in
pursuance  of  the  commitments  and  agreements.    A   multi-institutional
technical task force is to be organized in  each country and a  coordinating
secretariat elected from GRUCAN members.   UNDP has convened the  individual
organizational meetings and the GRUCANs of  Belize, Costa Rica, El  Salvador
and Nicaragua  had been  formally established at  the time  of writing  this
report,  with  multisectoral  participation   (central  authorities,  target
population,   national  and  international  non-governmental  organizations,
donor  countries and the  United Nations  system). In  Belize, the mechanism
operates in conjunction with  the sustainable human development programme at
the  local level.   In  Guatemala, the  project has not  really got  off the
ground  yet because  of difficulties  of coordination with  the work  of the
technical commission for implementation of the  part of the peace  agreement
concerned with the resettlement of uprooted populations.

25.   An important  source of  experience for  UNDP and  the United  Nations
system in the launching  of activities in implementation of the Mexico  City
Declaration of  Commitments is the Programme for Displaced Persons, Refugees
and Returnees in Central  America (PRODERE).  This UNDP programme has been a
key component of the  CIREFCA process and the largest operation of its  kind
in Central America.  It encompasses six national  and two regional projects,
with total funding of  US$ 148 million (US$  115 million from the Government
of Italy) and has been implemented by the United Nations Office for  Project
Services  (UNOPS) since  1990 with  the participation  of the Office  of the
United Nations  High Commissioner  for Refugees  (UNHCR), the  International
Labour Organization  (ILO) and  the World  Health Organization/Pan  American
Health Organization (WHO/PAHO) and the support  of the World Food  Programme
(WFP),  the United  Nations  Children's  Fund (UNICEF),  the United  Nations
Volunteers programme (UNV) and the United Nations Population Fund (UNFPA).

26.  The model for human development at the local  level launched by PRODERE
has  successfully promoted  peace  and reconciliation,  encompassing  in  an
integrated  way factors  relating  to  protection  of human  rights,  better
access  to education and health care, production, credit and employment.  It
adopts  a participatory  approach that  strengthens local  organizations  at
various levels.  The programme  has benefited half a million people directly
and almost 600,000 others indirectly in  the five Central American countries
and Belize,  involving  93 municipalities  and  over  800 local  development
committees  that it has helped to  establish in 14 areas of  operation.  The
action of  PRODERE  has been  acknowledged in  such areas  as human  rights,
education (over 350 schools built or  renovated, 6,400 teachers trained  and
over 50,000  persons taught  to read),  health  (over 100  centres built  or
renovated),  vocational training,  credit  and production  projects  (micro-
enterprises and agricultural development)  and infrastructure (water  and/or
sanitary  facilities provided for  more than  265,000 people  and over 1,300
kilometres of roads built or repaired).

27.  PRODERE wound up its  operations on 31 July 1995.   Experience with the
model  is being  turned to  account in  a broader  programme  of sustainable
human  development at the  local level.  At a  special event held during the
World Summit for Social Development in Copenhagen from  6 to 12 March  1995,

the  Governments  of  Central  America  introduced  the  initiative  in  the
framework of the Alliance for Sustainable  Development.  At the Governments'
request, UNDP,  with the  assistance of  United Nations  agencies is  taking
steps to launch a new initiative on the  same front, which will focus on the
selected  priority  areas.     The  programme  will  comprise  the   country
subprogrammes that  are currently being implemented, taking into account the
distinctive features  of each country.      Methodologies that  have already
been tested  will be applied in each  area to support the processes of State
decentralization and modernization, to strengthen local authorities  through
community,  municipal  and  departmental  development  boards,  to integrate
organizations  representing  civil  society  and  to  establish  systems  of
production,  employment and  local  services.    These will  be  coordinated
operations, to  which it is hoped  that various bilateral  donors, banks and
development funds will  contribute, supplementing the financing provided  by
the countries themselves.  They may be implemented  in different ways to  be
specified  by the individual  organizations.  In particular,  in the case of
Guatemala, proposals have  been drawn up in connection with the agreement on
populations  uprooted  by  the  armed  conflict  and  are  currently   being
considered  by IDB and  the Central  American Bank  for Economic Integration
(CABEI).


V.  ECONOMIC AND SOCIAL DEVELOPMENT

A.  Agricultural development

28.   The Regional Unit of  Technical Assistance  agricultural project (RUTA
III) was initiated in April 1994.   It is implemented by the World Bank with
financing  from  the  United  Nations  Development  Programme  (UNDP),   the
Government of  Japan, the  International Fund  for Agricultural  Development
(IFAD), the  Inter-American Institute of  Cooperation in Agriculture  (IICA)
and the  Government of  Norway, in  addition to  in-kind contributions  from
countries.  The inclusion in the near future  of IDB (which participated  in
the earlier phase, RUTA  II, until 1994) will  increase financing to a total
of over US$ 5.1 million.   The project provides Central American Governments
with  assistance   in  their   policies  and   programmes  of   agricultural
modernization  and  institutional and  rural-sectoral  reform  in  order  to
strengthen  the process of  sustainable development  in the  subregion.  The
project supports countries in:  (a)  the formulation of policies, programmes
and  projects for investment and technical assistance  in the implementation
of  lending operations; (b)  the strengthening  of the  capacities of public
and  private  institutions   through  training;  (c)  the  formulation   and
implementation  of strategies for  addressing the  problem of rural poverty;
(d)   the  implementation   of  gender-specific   policies  on   women   and
development;  (e)  the  strengthening  of  sustainable  agriculture  through
appropriate  management  of  natural  resources; and  (f)  the  adoption  of
policies derived from the process of trade liberalization.

  B.  Social investments

29.   The  Regional Unit  of  Technical Assistance  to alleviate  poverty in
Central  America  and  Panama   (Social  RUTA)  project  has  continued  the
operations  which it began  in July  1993.   The project is  executed by the
World  Bank   with  the  participation  of   WHO/PAHO  and  with   financing
contributed  by UNDP, the  Government of  Japan and IDB.   Working through a
regional unit in contact with national  technical units, the project's  goal
is to assist countries in formulating  policies and programmes in the social
sector by  strengthening the capacity of  national teams  in the preparation
and  evaluation of  programmes and  projects,  with particular  emphasis  on
basic  education,  health,  nutrition  and  increased  funding  for   social
investment.  The project  has contributed to the identification, preparation
and approval  of World Bank  and IDB loans in the amount  of US$ 310 million
approved to date  and another  US$ 474  million under  consideration by  the
banks.  By  focusing on the  most vulnerable groups,  the implementation  of
this project  will contribute to  the achievement of  greater equity in  the
allocation of public spending and to  improved quality of services,  broader

coverage, and capacity-building of institutions in the social sectors.

30.  In the  health sector, the second phase of the UNDP project executed by
WHO/PAHO and entitled "Management of health  services" will be completed  in
August.  The  project has achieved results in  four areas:  mobilization  of
external and  internal resources,  support for the transformation  of health
systems at the national and  local levels; exchange and mutual support among
countries  in the  management of  health services;  and  the   production of
technology,  including a  management information  system for  the  efficient
administration of health services.   The system has been established in  all
of the countries.

31.   UNDP  has also contributed to  the financing of the  operations of the
regional water and sanitation network in a project  implemented by the World
Bank and  involving the participation of UNICEF, WHO/PAHO, Swiss development
assistance, USAID,  the German  Agency for  Technical Cooperation  (GTZ) and
the Canadian  International  Development Agency  (CIDA).    The project  has
supported  the  establishment  of  policies  and  programmes  for  increased
efficiency in the quality and distribution  of water and sanitation services
in the subregion.  In its second phase (1995-1996), for  which UNICEF is the
lead  agency,  IDB  has  become  involved   and  the  network  has  received
additional financing from the  Governments of Sweden  and Switzerland,  UNDP
and the  World Bank.    The network  promotes the  exchange of  information,
supports the establishment of water and  sanitation centres in Honduras  and
Nicaragua  and  participates  in  sectoral  reform  in  the  rural  areas of
Honduras in cooperation with the World Bank, IDB, WHO/PAHO and USAID.


VI.  THE ENVIRONMENT AND SUSTAINABLE DEVELOPMENT

32.   In the  area of  the environment  and the  sustainable development  of
natural  resources, UNDP  supports the  activities of  the Central  American
Commission on  Environment and Development (CCAD) at the regional level.  In
1994, the projects executed under the  Special Plan of Economic  Cooperation
for Central  America (strengthening  of CCAD  in coordination  with IDB  and
forestry development) supported the Governments and CCAD in the  preparatory
activities of the Alliance for Sustainable  Development.  In connection with
the  decisions of the  Alliance, priority  activities are  being followed up
and new initiatives are being launched.

33.   In February 1995, a meeting organized by CCAD was held in Panama City,
with the participation  of representatives of national governmental  bodies,
non-governmental   organizations   and  organizations   representing   civil
society, parliamentarians  and cooperation  agencies.   Its  purpose was  to
discuss  substantive Alliance  topics  and  implementation and  coordination
mechanisms  to  fulfil existing  commitments,  particularly  in  respect  of
biodiversity,  environmental  legislation  and  arrangements  for  regional,
national and  local participation.   The activities  involve the coordinated
participation  of  various   donors:    USAID,  the  Finnish   International
Development  Agency (FINNIDA),  the Danish  International Development Agency
(DANIDA), GTZ,  France, CIDA,  and the European Union;  cooperation agencies
connected  with  the environment,  including  the  International  Union  for
Conservation of  Nature  and Natural  Resources,  the  World Wide  Fund  for
Nature, the  World Resources  Institute and IICA;  United Nations  agencies,
such  as  UNDP  and the  Food  and Agriculture  Organization  of the  United
Nations (FAO); and organizations representing civil society.

34.   Regarding forestry development, support is being  given to the Central
American Forestry  Council, which arose out  of the  Regional Convention for
the  Management  and  Conservation  of  Natural Forest  Ecosystems  and  the
Development  of Forest  Plantations,  signed  by the  Ministers for  Foreign
Affairs  in October  1993. The  aim is  to support  the design  of  forestry
policies and  strategies; management plans for  the development of  forestry
resources;  proposed  technical standards  for  the  certification  of  wood
products  originating   from  sustainably  managed   forests;  a  plan   for
preventing and fighting forest fires;  case studies of forestry concessions;

reduction of the greenhouse effect through  the limitation and absorption of
carbon  dioxide;  and formulation  of  framework  forestry  legislation  for
Central American countries.

35.   Regarding  the conservation  of  biodiversity  and the  protection  of
wilderness  areas, support  is being  provided for  the work of  the Central
American Council  for Protected  Areas, which  arose out  of the  Convention
signed by  the Central  American Presidents  in June  1992.  The  aim is  to
facilitate the establishment of the Central American biological corridor  on
the basis of the  strengthening of national systems  of protected areas.  In
particular, it  is hoped  that the  Global Environment  Facility (GEF)  will
finance a  project for  the preparation  of a  more detailed  stage of  this
initiative.  Other undertakings  include the establishment  in each  country
of national biodiversity  centres and botanical gardens to promote  research
on the exploitation and  conservation of biodiversity, as well as an  agenda
for land-use management.

36.   Along  with those  efforts,  UNDP supports  national efforts  with GEF
financing.  Belize is implementing a coastal  management plan to protect its
coral reefs,  at a  cost of  US$ 3  million.   Costa Rica  is continuing  to
execute the  project in  support of the  sustainable management  of the  Osa
Peninsula  within its national  system of  protected areas  (US$ 8 million).
In  Guatemala, a  project called  "Full  protection  of biodiversity  in the
Sarstung-Motagua region", amounting to US$ 4.1 million, was approved.
  37.  As a result of the commitments made  at the United Nations Conference
on Environment  and Development under Agenda  21, UNDP,  in conjunction with
the  Earth Council,  began a  national project in  Costa Rica  involving the
Government,  interested partners  and United  Nations agencies.   A national
committee  established and  coordinated  through the  Ministry  of  National
Planning and Economic Policy promotes and supervises its activities.


VII.  INSTITUTIONAL ASPECTS AND MANAGEMENT CAPACITY

38.   At this stage in the  Central American situation,  an attempt has been
made  to  develop a  loose  management  structure,  making  use of  existing
organizations  and fostering  the formation of networks  that would maximize
the  flow of  information and  ensure  transparency.   This  facilitates the
sharing of  experience and  information at  the regional  level between  the
various national  organizations,  both  governmental  and  non-governmental.
Each  regional project  is  implemented  in relation  to  the  corresponding
national  counterparts   and  the  existing   regional  organizations   with
competence in that  specific area. Furthermore, maximum  use is made of  the
inter-agency  work  of  the  United  Nations,   based  on  the  coordination
guidelines  offered by  the country  strategy  note  and the  interaction of
agency heads at the subregional level.

39.   The strategy for  the regional  programme emphasizes capacity-building
of  national and  regional  institutions.    In  general,  projects  include
activities or components aimed at the  strengthening of public entities that
act as  national counterparts, including  (a) creation and/or  strengthening
of  consensus-building  capacity;  (b)  establishment  or  strengthening  of
management capacity for the development process,  especially in the area  of
formulation and implementation  of public policy; (c) support for  increased
outputs  and creation of institutional capacity to undertake new activities;
and (d) improvement of the efficiency  of information and management systems
in general.


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Date last posted: 18 December 1999 16:30:10
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