The World Bank approved a US$10 million technical assistance loan today for the Nicaragua Public Financial Management Modernization Plan, to be undertaken with the support of the Inter-American Development Bank (IDB), the European Commission and the Kingdom of the Netherlands, with the intention of improving the accountability process.

“This project will strengthen governance through the modernization and professionalization of State institutions and the promotion of citizens’ participation,” said Camille Nuamah, World Bank Resident Representative in Nicaragua.

Some of the results expected from the implementation of this project include:

• The comprehensive implementation of a more precise and timely financial management system throughout the central government up to the spending unit level, which will permit making decisions regarding budget allocations and to monitor and control financial flows in a more efficient manner.
• Optimization of fiscal savings in cash management and treasury operations, public acquisitions and auditing.
• The presentation of public sector financial statements according to international regulations, to generate confidence in citizens and investors regarding fiscal performance.
• Strengthening the human resources management system within the context of civil service reform.
• Greater vigilance of public budget execution by civic groups, which will result in a more transparent and results-based public administration.
• Greater transparency and public information access that will allow citizens to monitor public administration processes.

As part of the Modernization Plan, the new Administrative and Financial Management Integrated System (SIGAF) consists of a completely integrated and interoperable network application that will integrate and gradually replace the Financial and Audit Management Integrated System (SIGFA), articulating public record and operational control needs with access to that same information on the part of participating institutions and civil society in general, strengthening existing social control mechanisms.

“All governing offices within the Ministry will actively participate in the design of this project to guarantee system integration, its implementation and program sustainability,” said Alberto Guevara, Minister of Finance and Public Credit.

This project will be undertaken within the framework of the Country Partnership Strategy and will be coordinated by the Ministry of Finance and Public Credit, to be executed between 2011 and 2014 with a 40-year maturity period and a 10-year grace period.