In the budgetary extension that has not yet been sent to the Executive to conclude the process of Formation and Sanction of a Law, the Ministry of Agriculture, Livestock and Food (Maga) was assigned more funds for the purchase of inputs for sowing, in addition to a Farmer Credit Fund, the latter of which will support agricultural production and which will apparently result in a reduction in the price of the basic basket.
But the measure is criticized by experts on the subject, due to technical aspects of it that could open the door to possible acts of corruption.
The objections
The Central American Institute for Fiscal Studies (Icefi) pointed out that there is an inconsistency in the amounts, since the article approved by Congress refers to an increase of Q1 billion, but when reviewing decree 16-2024, a figure of Q820 million is used.
Icefi also points out that the document establishes that the Executive will make the analytical distribution, which they consider to be an “anti-technical and opaque” measure because the programmatic structure of the budget is not specified.
The funds will be divided into Q400 million for the purchase of fertilizers, Q20 million for seeds and another Q80 million for farming implements, plus Q500 million for loans.
Regarding acquisitions, it is established that bidding or quotation is not mandatory, that is, they can be obtained through direct purchase. On this aspect, Icefi pointed out that “this provision reproduces the regulations that in the past facilitated abuses and acts of corruption.”
Measures
The head of MAGA, Maynor Estrada, said that part of the transparency measures that will be taken in this regard is to create contract bases “that are not restrictive”, as well as to make a public launch of what is required and the offers they receive.
“I believe that this makes the process much more transparent because, to a certain extent, we are not only seeing a huge participation, which is what we expect, but also the opening of these quotations or these offers will be made public with the participation of the media. This necessarily guarantees a citizen’s judgment, which is what is important to us,” said the minister.
Icefi also believes that the measure lacks technical grounds to address food insecurity caused by food shortages. It is only one of the important factors and to address it, more factors must be taken into account.
“Otherwise, as experience has already shown, the effort may prove ineffective or, worse still, result in loss of financial resources and vulnerability to abuse and acts of corruption,” warns the Institute.
Estrada argued that the measures were based on the increase in the basic basket and products such as fertilizers that are imported.
Indicated
The amendment to include the purchase of fertilizers was signed by more than ten deputies, including Nery Rodas of the Cabal party. In 2016 he was accused of possible acts of corruption in a Maga program.
In this context, the deputies of the National Unity of Hope (UNE) criticized that Rodas’ company obtained Q19 million in a subsidy initiative.
Rodas said that this aspect could not be considered a conflict of interest. He said that he has been dedicated to the sale of agrochemicals and fertilizers for more than 35 years and that his company is not one of the largest in the market.
He recalled that that year, people came to his company, which has 40 agricultural services in the south of the country, to exchange coupons and that this did not mean that he was a state contractor.
“Maga will have to go out and see where it can get a little bit (of products) with all that they have so that at some point it can supply because there is no fertilizer on the market. So, where will it benefit me?” Rodas argued.
Agricultural fund
Regarding agricultural insurance, the budget extension approved a fund of Q500 million for agricultural loans with the National Mortgage Credit (CHN). The article establishes that 15 days after the law comes into force, the portfolio together with the Board of Directors of the banking entity must present the respective regulations.
Icefi points out that although it appears to be a legitimate measure aimed at reducing costs and food insecurity, there is a negative precedent that occurred in previous administrations. They dispute that Congress approved the measure without the requirements and evaluation criteria being established.
“This provision was not supported by any study or analysis of the capabilities of the MAGA and the CHN to guarantee the proper operation of a fund of this nature, nor were there technical opinions or rulings from specialized entities such as the Superintendency of Banks,” criticized Icefi.
The Association for Research and Social Studies (Asies) urges that transparency measures be implemented in both credit and product acquisition and that “special monitoring” be given within the framework of the methodology called budget by results.
The minister says that there have already been discussions with the CHN authorities to create the corresponding regulations and protect farmers who could be affected by an unexpected rainfall that damages the infrastructure of their investments.
“So that all farmers have access to funds at a low cost, a cost that obviously allows the agricultural activity they develop to be sufficiently profitable to be able to pay the loan. Undoubtedly this will be a loan that will also carry insurance,” he explained.
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