Program to promote productive economy in Venezuela

The Andean Development Corporation (CAF), today approved a loan of US$100 million to support plans to stimulate a productive economy in Venezuela. The loan, which is repayable over five years with a one-year grace period, will provide partial financing for the Economic and Social Development Plan of the Nation 2001-2007.

The CAF executive president, Enrique García, said the amount of the loan represented 69% of the total estimated cost of the Program, and is in line with the Corporation’s policy of backing sustained infrastructure projects.

The Program is designed to stimulate the development of a productive economy, deepen social justice, strengthen democracy and contribute to the process of decentralization. The loan will also provide an immediate guarantee for meeting the public investment targets for 2001-2002.

The execution of the Program will focus on infrastructure projects in the transport, agricultural development and education sectors, which have been defined as priority by the Government.

In the transport sector, 50% of the CAF loan is destined for development and improvement of the urban and interurban road system. The projects include completion of the Caracas-Tuy Medio rail link. This transport project is the first stage of the Central Region Transport System which will later continue on to Maracay, Valencia and Puerto Cabello.

A further 25% of the loan will be used for agricultural development to promote and integrate policies that converge in an economic development model geared to stimulating the competitiveness of the productive sectors on both the domestic and international markets.

Major projects to be financed in this sector include the construction of large and medium-sized irrigation systems in an effort to promote competitive and sustainable development of regional and national agriculture and guarantee the food security of a large sector of the population.

The remaining 25% of the CAF loan will go to education, which is the third focus of the Program. The objectives are to supply integrated assistance to the school population to meet their food, socioeconomic and health needs, develop physical infrastructure and equipment, provide training for integration into the labor market, improve sports facilities, stimulate creativity and preserve cultural, ethnic heritage and civic values.

The most important project in this sector is the Modernization of Technical Education, which involves strengthening university institutes of technology, university colleges and universities, especially the introduction of new technology.