Agreements for US$200 million for projects in Ecuador

(Caracas, February 10, 2010). Ecuadorian Finance Minister María Elsa Viteri and CAF Vice President and Deputy CEO Luis Enrique Berrizbeitia signed agreements totaling US$200 million to execute projects aimed at improving the quality of life of Ecuadorian citizens. The ceremony was attended, as witness of honor, by Ecuadorian ambassador in Caracas Ramón Torres, and as representative of the Corporación Financiera Nacional (CFN), Diego Figueroa, deputy manager of the institution.

The first loan for US$100 million will partially finance the Environmental Sanitation Program for Community Development (PROMADEC), to be executed by Banco del Estado in coordination with the Ministry of Urban Development and Housing (MIDUVI), while the second operation is a US$100 million rotating line of credit to be executed by CFN.

Almost 2 million inhabitants with better health conditions

After the ceremony Luis Enrique Berrizbeitia said, “with this program, PROMADEC will improve the quality of life and health conditions of poorest and most neglected rural and urban marginal populations of the country, through a sustained increase in coverage, quality and efficiency of basic services of potable water, sewerage, and solid waste collection and disposal."

The Execution of PROMADEC will benefit about 1,800,000 inhabitants. "This is in line with CAF's commitment to support an integrated development agenda, aimed at improving human and social capital in rural areas," the CAF vice president added.

Minister Viteri emphasized the excellent relations between CAF and Ecuador. "It is important to conserve these ties for the Ecuadorian people because we believe they are a clear demonstration of a government which wishes to maintain development and growth, and we have demonstrated this in terms of important and constructive projects."

For the first phase of this program, CAF approved a US$200 million loan, of which US$100 million was approved in November 2007 and US$100 million in today's signing. PROMADEC has a total cost of US$240 million, with the CAF loan equivalent to 83%, and the remaining 17% to be financed by matching contributions from Banco del Estado and the beneficiary municipalities.

Funds for employment and reactivation of the productive sector "The financial situation is evidence of the anti-cyclical action of CAF which makes facilities available to its shareholders to mitigate the negative effects of the world financial crisis," Berrizbeitia said in relation to the US$100 million loan which Figueroa signed for CFN with the CAF vice president.

The funds will be go to the productive sector of the country through CFN which will provide credit directly and/or through the Ecuadorian banking system. This finance is part of the government’s National Development Plan whose objective is to generate employment and reactivate the Ecuadorian productive base.

CFN is an autonomous public financial institution, with legal personality and indefinite duration, which promotes investment, economic development and competitiveness in the country’s productive and service sectors. Its objective is to become the main source of financing for the country's productive sector, as executing body for the national government.