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Manos Unidas por El Salvador: Alliance between PADF and Banco Agrícola impel Remittances
El Comercio
March 24, 2005
Translation by PADF
The Pan American Development Foundation and Banco Agrícola de El Salvador have announced the second financing phase of their innovative alliance “Manos Unidas por El Salvador” which promotes, through remittances or community remittances sent by organizations, economic and social development in El Salvador.
In 2004, the program Manos Unidas help finance and implement six educational projects with the participation of Salvadoran immigrant groups, including the installation of a computer center in the Community of El Piche, the construction of classrooms and an English language lab in San Vicente, the construction of classrooms and the principal’s office in Chiquirín, the implementation of a vocational mobile academy in Cacaopera, the installation of a mini library in El Tamarindo, and an environmental laboratory and tree nursery in Chinameca, as well as assistance to more than 2,000 students in rural areas throughout El Salvador as part of Programa ALCANCE financed by USAID.
Remittances as the new Banking Product
For Ernesto Magaña from Banco Agrícola, during the first semester the bank will open six offices in Virginia and this will facilitate remittance transfers to El Salvador and will strengthen Program Manos Unidas, “the way the mechanism works is that if you make a transfer, we destine a percentage of our money to this fund which is to be used for development projects in this country, with your contributions, you can materialize it into very nice projects… But, why do Salvadoran banking institutions target remittances rather than internal savings and the creation of employment? Could this be the newest lucrative business? The bank doesn’t see the remittance transfer business as lucrative, the issue of remittances is something complicated we charge 10 at Banco Agrícola and you can send up to 1,500 dollars, we charge a rate of 1.5% compared to other remittance transfer agencies who charge 8 to 10% it is accessible to the people.
“We have found this new vehicle, an ideal mechanism to maintain a close tie between the people who remain over there and the ones who are here, logically having an impact on the quality of life of the people who are over there, it is a reality we are not generating the amount of jobs that out economy needs that are demanded by our population. We hope that the next five years desertion is reduced” said Ernesto Magaña from Banco Agrícola.
Remittances do what the Salvadoran Government Doesn’t
Recently, a Salvadoran periodical published a survey in which three out of every five Salvadorans wish to emigrate to the United States as a result of a lack of labor opportunities in El Salvador and because of the constant public insecurity.
“El Comercio Newspaper” asked if these programs stop immigration or whether it is the projects that the Salvadoran government can’t or doesn’t want to implement, to which Amy Coughenour, president, answered that remittances don’t make parasites out of the Salvadoran population, but instead they develop new life styles, the committees contribute a third of the funds for the projects and the foundation contributes the rest. That is the way the program works.
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