CAF president to make official visit to Mexico

(Caracas, April 15, 1993).-- CAF president & CEO Enrique García will make an official five-day visit to Mexico to strengthen financial and commercial relations between that nation than the five countries of the Andean Group.

The visit to Mexico City and Monterrey will take place from April 19-23.

The program includes the signing of three agreements -- two work programs and a line of credit – along with a series of meetings with high-level representatives of the Mexican financial sector and private business.

With these new actions, Andean-Mexican companies will have an important market for projects, pre-investment studies and technical assistance which will result in a series of joint business and investments between the six countries involved.

In this respect, the visit will seal an important and pragmatic integrationist commitment of great importance given the start of the first free-trade zone in Latin America, formed in 1992 in the framework of the Andean Group.

With Chile, Mexico is one of the two non-Andean CAF shareholders. In 1990, Nacional Financiera SNC (NAFIN) – body authorized by the Mexican government to subscribe to the CAF shares – acquired a total of 4,000 series "C" shares for a nominal value of US$5,000 each. Of these, 1,600 are guarantee capital.

The series "C" shares are reserved for extra-subregional natural persons or legal entities as a means of establishing links with the other countries of Latin America and with friendly nations interested in collaborating with continental integration.

Mexico was the first extra-subregional country to subscribe to this class of shares.

As development bank, NAFIN has the function of channeling financial and technical support for the industrial development of Mexico.

Agreements The new series of agreements signed in Mexico will stimulate existing agreements, particularly on trade development, and promote new actions which lead to financially viable investment projects. They will also facilitate access to goods and service markets, both technological and financial, and the design and implementation of support and technical assistance programs for small- and medium-sized industrial enterprises which wish to participate in the Andean region, training of human resources in technical-financial areas and exchange of information on the commercial prospects which the joint market offers.

These lines are contained in two work programs to be developed over two years (1993-95), which will be signed with NAFIN and the Mexican Foreign Trade Bank (Bancomext), respectively, on April 19 next.

Additionally, on April 20 an agreement will be signed to grant a US$10 million line of credit to Banco Nacional de Mexico (Banamex) to expand and strengthen the exportable offer of the Andean countries.

Previously, CAF had signed similar agreements with Bancomext for a total of US$30 million.

Of this total, US$20 million was made available to CAF by Bancomext to finance businesses resident in any Andean country which wish to import primary products, durables, consumer goods, components and spare parts, capital goods and services from Mexico.

In the reverse direction, CAF granted US$10 million to Bancomext to finance exports from the Andean subregion to Mexico. In 1992, imports from the Andean Group totaled US$219 million, while exports to the subregion totaled US$605 million.

Mexico is a member of the Group of Three with two CAF member countries (Colombia and Venezuela) with the possibility of the entry of a third country: Ecuador. Also in 1992 bilateral productive contacts were made with the other Andean nations.

For its part last year CAF began an important approach to the Caribbean area, in addition to its active cooperation with certain programs which involve Mercosur members countries, such as physical integration and protection of the indigenous peoples of the Amazon.

In short, CAF is continuing its work in favor of establishing effective and pragmatic channels of communication as a means of contributing to the integrationist ideal of Latin America and the Caribbean.