Operations for $447 million approved for Ecuador

(Caracas, December 10, 2003).- CAF Executive President Enrique García said today that approvals in favor of Ecuador totaled $447 million in 2003, including $360 million for government efforts to improve the country´s macroeconomic and institutional situation, and develop infrastructure and competitiveness. García said that the Andean Development Bank, which he heads, approved a record amount of $3.33 billion in benefit of shareholder countries during the year.

The approvals for Ecuador included $100 million to finance the government´s economic program and important institutional aspects of public policy such as national planning, decentralization of central powers to local governments, strengthening of financial market supervision agencies, and the in situ inspections scheme for the commercial banks.

The infrastructure and competitiveness areas received $260 million to assist the country and the regions with the development of an efficient and reliable road infrastructure system, capable of resisting natural phenomena such as El Niño. The competitive component covers a set of actions designed to facilitate Ecuador’s integration into the global economy, with increased exports generated by continuous improvements in productivity in an effort to generate employment and improve the population´s quality of life.

The private sector received $85 million for the corporate and financial sectors. In the corporate sector, the Corporation played a key role in renewing lines of credit with local banks for $50 million, including funds for microfinance institutions. The remaining $35 million was allocated to other operations in the corporate sector.

In 2003 technical cooperation operations for $2.1 million were approved through the Technical Assistance Fund (FAT), the Special Fund for Ecuador (FEE) and the Human Development Fund (Fondeshu). The projects financed focused on governance, competitiveness, integration, cultural development and microfinance.

Through the Governance Program, the CAF has continued to support the Institutional Strengthening, Training in Decentralization and Citizen Participation Program with the successful training of leaders and their support groups at national level. The Corporation has also supported the Presidency of the Republic with projects such as the National Dialogue for Unity and Development, and institutional strengthening in the economic, financial and environmental areas of the operations of PetroEcuador.

Various projects promoted by the Andean Competitiveness Program (PAC) were successfully concluded. The project Promotion of Dialogue between Universities and the Agro-Business Sector implemented by the IICA led to an interesting linkage between the two sectors.

The Central Bank of Ecuador finalized the Export Procedure Simplification Project, proposing, among other measures, the creation of export credit insurance. In information technology, the Community Learning Centers implemented by the ESPOL have given over 2,000 students in rural areas the chance to participate in this innovative learning process.

The Company Pre-Incubation Project concluded with the setting up of business development centers in various universities. A new incubator began operations, which already has 16 business initiatives in process of incubation. Lastly, the PAC began a project to support the textile and clothing cluster in an effort to increase exports in the framework of the ATPDEA.

Microfinance performed well in Ecuador during the year. The multilateral lender expanded its portfolio with an additional $1 million in approvals, and made the first disbursement to a new microfinance institution. Another important achievement was the unification of criteria with the IDB, USAID and the IFC on development of the industry and future trends. The Corporation also contributed to the organization of the III Ecuadorian Microenterprise Forum, the most important in the country with international projection.