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legislative, judiciary and executive branches of government,
as well as the use of plebiscites and
referendums.
However, the limited disbursement of aid so far,
compared with the sizeable pledges made in Stockholm,
pointed to some bottlenecks. The IDB's
MartõÂnez urged donors to work with Honduras to
strengthen its ability to manage projects to speed up
implementation.
Need for transparency
The Bank is working with the Honduran government
to promote transparency and good governance. A
central concern for Hondurans as well as for donors,
the issue may weigh heavily in the Central American
country's prospects of attracting more capital to
modernize its economy. Last year, Honduras ranked
low in the annual survey on perception of corruption
conducted by Transparency International, a Berlinbased
nongovernmental organization.
The IDB and several donor nations plan to support
Honduras' efforts to make its state procurement and
contracts system more efficient and transparent. As
initially drafted, the program would have two phases:
a temporary one to monitor projects during the post-
Mitch reconstruction period and a permanent one to
promote the modernization of the Honduran system of
checks and balances.
During the temporary plan, an international consulting
firm would be hired to perfom random audits
of reconstruction projects and check their technical,
financial and administration performance. These inspections
would be carried out in parallel to the
existing controls that individual donors have for the
projects they finance. The results of the audits would
be released to the Honduran government, donors and
the public. Given that some $2 billion could be spent
on reconstruction efforts, such as auditing exercise
could cost up to $30 million, the chief of the IDB's
Procurement Policy and Coordination Office, Jorge
Claro de la Maza, told delegates.
The other phase ± to which the IDB could
eventually commit some $14 million in soft loans ±
is aimed at allowing Honduras to acquire as much
know-how and technology as possible from the
international auditors. Under that part of the program,
local officials involved in procurement and contracts
would receive training, and new purchasing procedures
would be developed and enforced across the
Honduran public sector.
While the potential cost of the project gave some
delegates `sticker shock,' Claro de la Maza explained
that the estimate was based on a survey of auditing
firm fees. He also conceded that such controls are
expensive ± except when compared with the alternative
of not doing them.
76 ISSN 0256±6060±Unisa Lat. Am. Rep. 16(2) 2000