Contract signed for financing of Chavimochic III Project
CAF -development bank of Latin America - granted a loan of USD150 million for the Major Hydraulic Works of the Third Phase of the Chavimochic Project, which will irrigate 63,000 hectares of new areas and will improve the irrigation system in another 48,000 hectares in the valleys of Chao, Virú, Moche and Chicama, located in the La Libertad region.
(Bogotá, March 18, 2014).-The Republic of Peru and CAF -development bank of Latin America - signed a loan contract for USD150 million to finance the Major Hydraulic Works of the Third Phase of the Chavimochic Project, which will drive the agro-industrial development of the La Libertad region in northern Peru, by the construction of works to regulate the flow of water throughout the year and by finishing the principal conveyance channel.
The document was signed in Bogota by CAF Executive President Enrique García; and the Minister of Economic and Finanace Affairs, Luis Miguel Castilla.
After highlighting Peru`s sustained economic growth, CAF executive president noted that the government has promoted different projects to increase the country's productivity and competitivity.
Apart from the Chavimochic project, the Latin American institution has been providing significant support for the financing of two other large irrigation projects in Peru: Olmos and Majes-Siguas.
"With this transaction," Enrique García said, "a significant stimulus will be given to productivity in the agricultural and agro-industrial sector in the La Libertad region, along with the possibility of tripling exports, from USD400 million to USD1.2 billion, and creating 150,000 new jobs in that area of the country."
The works in this third phase of the Chavomochic Project will irrigate 63,000 hectares of new areas and will improve the irrigation in another 48,000 hectares in the valleys and inter-valleys of Chao, Virú, Moche and Chicama. In addition, the project will provide a secure water source for the city of Trujillo, the regional capital, and for the surrounding areas, while also generating electrical energy.
The funds from the loan will finance the direct costs of construction and the indirect costs, which include, among other things, engineering studies for the final design of the work and insurance of the work; as well as the supervision of the works.
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