<html xmlns:o="urn:schemas-microsoft-com:office:office" xmlns:w="urn:schemas-microsoft-com:office:word" xmlns:st1="urn:schemas-microsoft-com:office:smarttags" xmlns="http://www.w3.org/TR/REC-html40">
<head>
<meta http-equiv=Content-Type content="text/html; charset=us-ascii">
<meta name=Generator content="Microsoft Word 11 (filtered medium)">
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="country-region"/>
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="State"/>
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="City"/>
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="place"/>
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="PlaceName"/>
<o:SmartTagType namespaceuri="urn:schemas-microsoft-com:office:smarttags"
name="PlaceType"/>
<!--[if !mso]>
<style>
st1\:*{behavior:url(#default#ieooui) }
</style>
<![endif]-->
<style>
<!--
/* Style Definitions */
p.MsoNormal, li.MsoNormal, div.MsoNormal
{margin:0in;
margin-bottom:.0001pt;
font-size:12.0pt;
font-family:"Times New Roman";
color:black;}
a:link, span.MsoHyperlink
{color:blue;
text-decoration:underline;}
a:visited, span.MsoHyperlinkFollowed
{color:purple;
text-decoration:underline;}
span.EmailStyle17
{mso-style-type:personal;
font-family:Arial;
color:windowtext;}
span.EmailStyle18
{mso-style-type:personal-reply;
font-family:Arial;
color:navy;}
@page Section1
{size:595.3pt 841.9pt;
margin:70.85pt 85.05pt 70.85pt 85.05pt;}
div.Section1
{page:Section1;}
-->
</style>
</head>
<body lang=EN-US link=blue vlink=purple>
<div class=Section1>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal align=center style='text-align:center'><b><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
font-weight:bold'>ARENA’s Budget for “Development” in 2007:
Less Social S</span></font></b><b><font color=black><span lang=EN-GB
style='color:windowtext;font-weight:bold'>pending and More Economic Backing
from <st1:State w:st="on"><st1:place w:st="on">Washington</st1:place></st1:State></span></font></b><b><span
lang=EN-GB style='font-weight:bold'><o:p></o:p></span></b></p>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span style='font-size:12.0pt'>CISPES Update<o:p></o:p></span></font></p>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span style='font-size:12.0pt'>December 6,
2006<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><i><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;font-style:italic'><o:p> </o:p></span></font></i></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>On Thursday November 30, ARENA and its right
wing allies voted to approve the 2007 national budget in the Legislative
Assembly (see chart below). The budget they passed is characterized by its
cutbacks on social spending and a lack of transparency, especially around the
president’s discretionary fund and other governmental entities like the
offices of intelligence. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>While the budget for the President has
increased by 46% since 2003, Saca has refused support any shifting of funds
that would benefit local development. The FMLN and other local municipal
governments have called for a 2% increase in the funding to the municipalities,
but this budget includes no increase. Furthermore, the Ministry of
Defence will receive more funding than the Agriculture, Environment and Labor
Ministries together. Meanwhile, despite all the talk of fighting crime,
ARENA refused to give any additional funding to the National Police or the
court system. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>The FMLN voted against the budget because
it is based on fictitious calculations of economic growth and increases the
country’s level of indebtedness. The budget reduces funding to
public hospitals, which are already severely under funded, and reduces the
spending on public education. The budget also does not include an
increase to financing of the public <st1:place w:st="on"><st1:PlaceType w:st="on">University</st1:PlaceType>
of <st1:PlaceName w:st="on">El Salvador</st1:PlaceName></st1:place>, which
will leave an approximate of 12 thousand students without admission. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>Social organizations and unions protested
outside the Legislative Assembly during the budget vote. They protested
the overall mal-distribution of funds, and especially cited the lack of funding
for the Human Rights Ombudsperson’s office and the death threats against
her, her family and her co-workers. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>Meanwhile, Saca travelled to <st1:place
w:st="on"><st1:City w:st="on">Washington</st1:City> <st1:State w:st="on">D.C.</st1:State></st1:place>
on November 30 to ceremoniously receive the $461 million “gift”
from the Millennium Challenge Corporation. The money, awarded to nations
to supposedly help with development and work toward the Millennium Goals like
alleviating poverty and extending health care, will be used for the
construction of a northern highway, or (“longitudinal <st1:place w:st="on"><st1:State
w:st="on">del</st1:State></st1:place> norte”). Officially, the funds
will be distributed in 94 municipalities in the northern part of the country,
and the funding will last 5 years. Far from being a gift, however, the
funds represent economic intervention by the <st1:place w:st="on"><st1:country-region
w:st="on">U.S.</st1:country-region></st1:place>, since these funds will
finance the infrastructure for the implementation of CAFTA. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><b><i><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;font-weight:bold;font-style:italic'>Police
Attacks on Organizing in Rural and Urban Areas<o:p></o:p></span></font></i></b></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>
On Tuesday, November 28, at 3:00 am, more than 600 police and 150 soldiers
violently entered the community of <st1:place w:st="on">San Lorenzo</st1:place>
to arrest seven members of the “Committee of People Affected by the Storm
Stan and the Ilamatepec Volcano Eruption.” The community came
together after being left homeless or devastated by the natural disasters, and
it has been highly critical of the government’s ineffective response to
these disasters. The police and military stormed into people’s
homes, intimidating both children and adults. The community together with
ANTA (National Association of Agricultural Workers) held a press conference the
following day to denounce the arrests and the police intimidation. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>
Meanwhile, in <st1:place w:st="on"><st1:City w:st="on">San Salvador</st1:City></st1:place>,
members of the CD/DVD Vendors Movement have also been attacked by police.
The police again are raiding the “pirated” CD/DVD vendors to
enforce the CAFTA laws protecting intellectual property rights. In making
the confiscation of goods, the police have beaten and arrested various members
of the organized Vendors movement. The police also threatened the
movement leader for his organizing as they ransacked his home. <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p class=MsoNormal><b><i><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;font-weight:bold;font-style:italic'>Salvadorans
hopeful for change<o:p></o:p></span></font></i></b></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'>
In response to the economic and social crisis in El Salvador, the Public
Opinion Institute of the UCA conducted a survey in which 87% of the population
said that the country needs a change. According to the survey, it is
broad public opinion in <st1:place w:st="on"><st1:country-region w:st="on">El
Salvador</st1:country-region></st1:place> that violence and the cost of
living has increased during Saca’s term in office. Also, the survey
asked people which party they would vote for if the presidential elections were
now, and the results show a tie between ARENA and FMLN. The divergence
between the desire for change and tie between the two main parties reflects the
aggressive, dirty anti-FMLN campaign that ARENA is constantly carrying
out. Nonetheless, many people feel optimistic about a change coming to <st1:country-region
w:st="on">El Salvador</st1:country-region>, especially in light of the recent
elections in <st1:country-region w:st="on">Venezuela</st1:country-region>, <st1:country-region
w:st="on">Ecuador</st1:country-region>, and <st1:place w:st="on"><st1:country-region
w:st="on">Nicaragua</st1:country-region></st1:place>.<o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt'> <o:p></o:p></span></font></p>
<p class=MsoNormal><font size=3 color=teal face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:teal'><o:p> </o:p></span></font></p>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>* <b><span
style='font-weight:bold'>BUDGET 2007<o:p></o:p></span></b></span></font></p>
<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
style='border-collapse:collapse'>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><b><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext;font-weight:bold'>ENTITY<o:p></o:p></span></font></b></p>
</td>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-left:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><b><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext;font-weight:bold'>US$ MILLIONS<o:p></o:p></span></font></b></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Education<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 526.7<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Public Health<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 324<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Ministry of the Interior<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 201.7<o:p></o:p></span></font></p>
</td>
</tr>
<tr height=9 style='height:6.75pt'>
<td width=291 height=9 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Public Works<o:p></o:p></span></font></p>
</td>
<td width=291 height=9 valign=top style='width:218.0pt;border-top:none;
border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 122.9<o:p></o:p></span></font></p>
</td>
</tr>
<tr height=9 style='height:6.75pt'>
<td width=291 height=9 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Defence<o:p></o:p></span></font></p>
</td>
<td width=291 height=9 valign=top style='width:218.0pt;border-top:none;
border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 111.4<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Treasury<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 51.8<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Presidency<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 51.4<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Agriculture<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 35.6<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Chancellery<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 31.6<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Tourism<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 17.5<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Environment<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 10.5<o:p></o:p></span></font></p>
</td>
</tr>
<tr>
<td width=291 valign=top style='width:218.0pt;border:solid windowtext 1.0pt;
border-top:none;padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Labour<o:p></o:p></span></font></p>
</td>
<td width=291 valign=top style='width:218.0pt;border-top:none;border-left:
none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
padding:0in 5.4pt 0in 5.4pt'>
<p class=MsoNormal align=center style='text-align:center'><font size=3
color=black face="Times New Roman"><span lang=EN-GB style='font-size:12.0pt;
color:windowtext'>$ 8.9<o:p></o:p></span></font></p>
</td>
</tr>
</table>
<p class=MsoNormal><font size=3 color=black face="Times New Roman"><span
lang=EN-GB style='font-size:12.0pt;color:windowtext'>Source: Ministry of Treasury
website<o:p></o:p></span></font></p>
<p class=MsoNormal><b><font size=2 color=black face=Arial><span lang=ES-SV
style='font-size:10.0pt;font-family:Arial;color:windowtext;font-weight:bold'><o:p> </o:p></span></font></b></p>
</div>
</body>
</html>