Social investment funds in Latin America

This article deals with various aspects relating to social investment funds, especially their financing, the sustainability of the resulting projects, and the role of funds vis-à-vis ministries and the political authorities. The links between such funds and non-governmental organizations and the role played by external cooperation are also examined. Social investment funds were set up in order to relieve poverty and soften the effects of the adjustment policies of the 1980s. They have proved to be effective means of channelling flows of external finance and ensuring that they result in concrete projects. The main strategy used for transferring resources to the poor has been the creation of temporary jobs in connection with the execution of projects in the areas of social and economic infrastructure, as well as projects designed to satisfy basic needs. A smaller proportion of the financing obtained has been invested in direct production activities, usually through non-governmental organizations. Generally speaking, social investment funds have indeed served to relieve poverty. Although they were not conceived as a means of tackling the structural problems which lie at the root of poverty, they have made it possible to deal with acute economic and social problems.