cross-sectoral convening ability; and the authority to prioritize, scale and permit projects according to impact analysis.<sup>16</sup>

**_Delayed Implementation and Impact_** :  The lifecycle of project preparation for medium or largescale projects is generally 1 to 3 years, although projects that are simply awaiting financing may be “shovel ready.” This depends upon the depth and quality of existing economic, financial and technical feasibility work as well as the commitment to competitive procurement practices.  If projects to be funded are already designed and simply awaiting financing, the timeframe may be significantly shorter as might maintenance and minor rehabilitation contracts.  However, it is possible that projects that have been sitting in pipeline will require new demand studies, updated cost projections or even recalibrated willingness and ability to pay analyses given the shifting resources of consumers and the changing prices of inputs in the crisis environment.  Moreover, several countries in LAC habitually disburse less than their annually expected disbursements— typically around 75 percent of plan.  Given the importance of timeliness in generating stimulus effect, delays and slow disbursements would have a direct and perhaps irreversible effect on the impact of the project.

**_Affordability of the Stimuli Packages:_** The potential scope, size and timing of LAC’s proposed stimuli packages will be determined by fiscal space—the room in a government’s budget that allows it to provide resources for additional projects without jeopardizing the sustainability of its financial position or the stability of the economy.  In other words, fiscal space must exist or be created if extra resources are to be made available for worthwhile government spending17.  LAC’s proposed stimuli packages present enormous demand on the limited fiscal space in the region and the room for aggressive responses is heterogeneous across the region.  The challenge of creating fiscal space for infrastructure expenditure is that governments attempt to do so without compromising other usages such as safety net programs and human development interventions. The government must ensure that the higher expenditure in the short term, and any associated future expenditure—including recurrent spending on operations and maintenance triggered by new infrastructure capital investments or new public services—can be financed from current and future revenues<sup>18</sup> .  For the LAC countries lacking enough fiscal room, other complementary policies might be necessary such as saving through expenditure rationalization and tax reform, and mobilization of additional resources from borrowing and grants.  More so, the current crisis could be an opportunity for LAC to reprioritize expenditures and rid of unproductive spending and unviable subsidies. Several other instruments that may help create fiscal space are: implementing mechanisms that boost efficiency by reducing corruption and improving governance. Albeit difficult during recession, raising revenues for those countries with low ratios of government revenue to GDP may also help to create space.

**_Corruption Risks_** :  Emergency environments often create the impetus for shortcuts, particularly as they relate to time-consuming safeguard practices.  In a crisis situation governments may feel justified in seeking to bypass lengthy procurement policies such as international competitive bidding, pre-qualification, and re-bidding in the case of insufficient competition or nonresponsive bids19.  The temptation to trade time for competition raises the risk of corruption,

> 16 The Global Experts Team for Public Sector Management, in conjunction with LCSPS, is undertaking a study of best practices in the management of stimulus programs that includes a review of US and other OECD institutional arrangements.

> 17 Heller (2005).

> 18 Heller (2005).

> 19 Kenny (2007).

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