US$1.13 billion approved for non-Andean countries

CAF approvals to date total US$4.60 billion.

Enrique García, president & CEO, held a press conference to report on the activities of the multilateral organization in 2005.

A quarter of total approvals were destined for Argentina, Brazil, Costa Rica, Mexico, Panama, Paraguay and Uruguay.

A report on activities in 2005 was offered at a press conference in Caracas by CAF President & CEO Enrique García, who announced that this year the Corporation had achieved a record US$4.60 billion in approvals, including a total of US$1.13 billion for non-Andean shareholder countries.

CAF as coordinator of integration

"This performance has strengthened the institution’s coordinating role in Latin American integration and continued the expansion of its institutional and financial presence in the region. The Corporation has also increased its links with these countries and with other shareholders in the Andean Community," Garcia said. "In this area the capital increases subscribed by the Republic of Argentina for US$75 million, and Panama for US$10 million are important landmarks, which expand the spaces for action in these important countries," he added.

Support continued for the Puebla-Panama Plan and the connection with the South American Regional Infrastructure Integration Initiative (IIRSA) with a vision of Latin American and Caribbean integration.

CAF reinforced its presence in the most important schemes and integration blocs in the hemisphere and in Latin America and the Caribbean with active participation in the Andean Community and Mercosur and its presence at the summits of the Association of Caribbean States, Summits of the Americas and the Ibero-American Summit, among others. The institution promoted a renewed development and integration agenda in these multilateral forums, strengthening and expanding the role of its strategic programs in the area of physical and logistical integration, competitiveness and productivity, governance, human development, and the sustainable environmental agenda.

García said that in 2005 a total of US$695 million was approved in favor of Brazil, including US$500 million under the A/B loan modality for the Electrobras utility to partially finance the company's investment plan, and for Votorantim Participações S.A. also to cover its investment plan. Brazil received US$195 million in lines of credit, channeled through commercial banks, to finance the working capital and foreign trade of large companies.

For Argentina, a US$210-million loan was approved to finance the Yacyretá Binational HydroElectric Complex Termination Plan. A US$35-million line of credit was also approved in favor of the Investment and Foreign Trade Bank (BICE) to finance foreign trade with the Andean Community countries and a corporate loan for the Fluviomar Holdings LTD group to finance its operations in the Paraguay-Paraná Waterway.

For Panama an US$80-million loan was approved to finance the Road Rehabilitation and Upgrading Program for a total investment of US$125 million. The objectives of the project approved include reduction of vehicle operating costs and user travel time, as well as improvement of economic and trade activities in the free port zone between Panama and Colon.

Uruguay received approval of US$70 million for the Road Infrastructure Program Phase II, which will upgrade existing roads and connections with various localities producing benefits in domestic trade, among other advantages.

For the Republic of Paraguay, a US$9.5-million loan was approved to upgrade and rehabilitate roads in the country’s Main Road Network by financing for the Program for Supplementary Works for National Route 10.

Other contributions to sustainable development.

The CAF president reported approvals of non-reimbursable technical cooperation funds in 2005 for multinational operations and regional strategic programs in non-Andean countries for approximately US$8 million. The programs were financed with loans from the Technical Assistance, Human Development and Spanish Technical Cooperation Funds, especially operations in the priority areas of Integration, Competitiveness, Governance, Environment, Community Development, Culture, Microfinance and Social Development.

The projects financed by CAF in this area include Support for Expansion of the Credit Capacity of Argentina through Funding in the Capital Market and the Project to Regulate Microfinance in Argentina; the Cross-Border Mines Event: International Cooperation for Sustainable Development in Brazil; Assistance for flood victims of the Caribbean and Sarapiqui in Costa Rica; the Meso-American Workshop for Competitiveness in Mexico; the IX Meeting of the Meso-American Council for Competitiveness in Panama; and the Program of Integration Corridors of the West in Paraguay, among others, in addition to a series of multinational operations to support CAF’s coordinating role in Latin American integration.

CAF has grouped the common requirements of countries into Strategic Programs with regional scope. Approximately 50% of CAF technical assistance funds are directed to this mechanism, to contribute to achieving the goals in the context of the motivating stimulus of the Corporation’s renewed development agenda. Lastly, Garcia said that in the 1996-2005 period, the multilateral organization approved operations for US$3.51 billion in favor of Series C shareholder countries.