Contribution to strengthening competitiveness in Bolivia

To contribute to the Competitive Strengthening Program of Bolivia´s production and financial sectors, the Andean Development Corporation (CAF) approved today in its CXV Board Meeting held in Caracas, a financial operation for $75 million with a term of ten years and two years´ grace. The executing agency will be the Bolivian Ministry of Finance.

CAF Executive President Enrique García said that this operation supported the country’s efforts to build mechanisms to protect the national wealth, by strengthening viable companies that need to improve their solvency, liquidity and competitiveness.

At its Meeting, the Board approved operations for a total $788 million; in addition to the funds for Bolivia, financing was approved for Ecuador ($260 million), Peru ($353 million) and Venezuela ($100 million).

The Competitive Strengthening Program aims to contribute to the reactivation of the productive sector through financial and equity strengthening of the companies; developing actions to improve the their environment and competitive profile; providing support for the government in restructuring viable productive units that are experiencing financial difficulties; and developing a more dynamic, efficient and competitive export sector.

The financing approved by the CAF is destined for three components of the Program: 1) creation of a fund for the financial and equity strengthening of companies that have begun voluntary restructuring processes, with an allocation of $50 million; 2) a $23-million line of credit to finance programs of viable non-restructured companies through the creation of a Production Promotion Fund; and 3) a $2-million credit to improve the competitiveness.

The funds for the first two components will be channeled through the Nacional Financiera Boliviana (Nafibo), and for the third through the Ministry of Economic Development.

During the 1998-2003 period, the CAF has approved a global amount of $2.11 billion for Bolivia to finance road infrastructure integration programs, cofinancing operations, and trade and working capital programs.