Evaluates a Housing Guaranty project to finance basic infrastructure and shelter solutions for low-income urban families in Peru. Evaluation covers the period 7/80-5/81 and is based on a review of files, site visits, and the findings of an earlier PES. HG loan resources and beneficiary downpayments have benefitted approximately 43,000 families (43% above original projections), while technical assistance has been provided to the Housing Bank of Peru (BVP) to establish a home improvements program. By the end of Phase II, 18,506 electrical and 21,301 water/sewer connections will be made, 2,427 core units will be built, and 616 home improvement loans will be executed. Approximately 75% of all basic infrastructure is being provided to families in Pueblos Jovenes. To date, approximately 50% of home improvements have been structural. Rising construction costs have raised the average loan amount and correspondingly lessened the total number of loans to be disbursed. It now appears that the home improvement loan program will be completed on schedule. Recent national elections produced a change in BVP management. This facilitated the reorganization of the Bank”s structure, permitting improvements in program implementation. Unfortunately, inflation has escalated project costs and made it impossible for some beneficiaries to accept the completed projects, placing additional burdens on the Bank. To resolve this situation, the Board of Directors decided to reduce construction financing to the cost of long-term project financing. It is recommended that the BVP: (1) increase computer staff time devoted to recuperation; (2) establish an inter-agency coordination group; (3) strengthen promotion and outreach programs; and (4) undertake studies on standards and shelter policies. A.I.D. should: help BVP conduct evaluations; continue technical assistance funding; assist BVP in improving linkages between disbursements, liquidation, and recuperation; verify that BVP has met deadlines established in implementation agreements; and verify that reorganization procedure revisions have improved project performance.
