“What we are looking for is resources that allow us to invest in social programs,” said Pastrana, following a closed-door meeting at World Bank headquarters with Wolfensohn, IDB President Enrique Iglesias, and other Bank officials. Pastrana is seeking $3.6 billion in international aid for his country.

“Although we have cut our spending, we will not allow this to affect social programs. What we are saying to the US and the international community is that it’s up to all of us to put an end to the scourge of drugs,” Pastrana added.

A worsening economy—the country is in its worst recession in over 60 years—guerrilla violence and the escalating production of illegal drugs has made the situation in Colombia untenable. Unemployment is at 20 percent, and upwards of 750,000 people are internally displaced, a “moving frontier economy” of poor and disenfranchised peasants who, caught in the crossfire of armed groups and with no capacity to claim ownership of land, stay on the move, surviving on the little they grow.

Like Pastrana, the World Bank believes that restoring peace is the most significant development priority in the country. Although the road to peace has been rocky, “the potential rewards for Colombia are great and warrant Bank support,” says Gustavo Gaviria of the World Bank Executive Director’s Office for Colombia.

To that end, the Bank is supporting Colombia through a number of projects to strengthen peace and development, including community development programs, judicial reform, rural education, transport project, and others.

More critically, the Bank is concerned about how the crisis will affect social programs for the poor, who are the most vulnerable to economic downturns. In collaboration with the IDB, the World Bank is developing an ambitious long-term loan package to support education, health and unemployment programs in the upcoming fiscal year. This would also provide a buffer against budget cuts and fiscal adjustments.

The Bank is also preparing a $500 million Financial Sector Adjustment Loan, to be presented to the Bank’s Board of Directors in late October, to strengthen Colombia’s banking system. At that time, the Bank will also present a Country Assessment Performance Review.