US$400 million for Bolivia

García said that "CAF support for Bolivia is concentrated on areas related to transport and internal and international physical integration projects, as well as initiatives to improve urban infrastructure." In the social area funds were channeled into rehabilitation and reconstruction of losses of physical capital caused by the rains, while the private sector received financial support for expansion of investment and for the needs of the small- and medium-sized enterprises sector through the local financial system, he added.

Support for regional integration As part of the regional integration dynamic, in 2006 CAF attended Bolivia’s requirements through a series of approvals, which, at the same time as increasing national integration will open additional connections with Argentina, Brazil, and Chile. The CAF chief emphasized the approval for the South Integration Highways-Phase II program (Cotagaita-Tupiza-Villazón) for US$120 million, which will boost trade between various urban and productive centers of the Altiplano, the valleys and eastern plains, as well as converting the highways included in the program into corridors for trade with Argentina.

As part of the Integration to the North Program, which the Bolivian government is promoting, a US$42-million operation was approved for the Riberalta–Guayaramerin Integration Highway project (Brazilian border), which will open the route to vehicle traffic all year round, as well as reducing costs of operation, vehicle maintenance and transport.

The Huachacalla–Pisiga Integration Highway (Chilean border) received a US$25 million approval. This project consists of paving a 71-km section between the localities of Huachacalla and Pisiga in Oruro department. Pisaga is neighbor to Colchane on the Chilean side of the border. This is an important step in the execution of the Oruro–Pisiga Integration Corridor. The Potosí–Uyuni Highway with financing of US$75 million is an important regional integration project to open another connection with Chile, and also improve access to Salar del Uyuni, one of Bolivia’s main tourism destinations.

García emphasized the importance of supporting regional initiatives that have a high impact on urban development, contribute to satisfying collective needs and guarantee the integration and participation of citizens in planning and sustainable human development. In this respect, US$14 million was recently approved for Puente Trillizos in the city of La Paz.

These loans are eligible for the CAF Compensatory Financing Fund, which grants a substantial reduction in financial costs and an extension of grace and amortization periods.

Integrated response to Bolivian development The CAF President said the Corporation has concentrated its efforts on an integrated development agenda which aims to improve the living conditions of Latin Americans, through sustained quality growth, which is development that generates employment and is inclusive. García proposed that this agenda be based on three fundamental aspects: stability, efficiency, and equity. To do this the agenda must take into account the principles of environmental sustainability, increased international participation, and democratic governance, with the joint participation of public and private sectors, with civil society and the international community.

Along these lines, US$15 million was approved early this year as part of CAF actions in favor of activities to rehabilate and reconstruct the losses of natural and social physical capital caused by the torrential rains in Bolivia in late 2005 and early this year. The funds will be used to finance studies, execute works, as well as supervision, inspection and administration of the Natural Emergencies Response Program, environmental and social costs, among others.

To strengthen financial systems and capital markets in 2006, a total of US$14 million was approved. García explained that "these approvals are part of the CAF strategy, through its role as catalyzing agent, to provide effective support to banks in their efforts to promote trade in the region, opening the way for Latin American development,."

With respect to the work in Bolivia of the CAF Competitiveness Support Program (PAC), for the second consecutive year PAC backed the Ideas Emprendedoras national competition for the best business plan. CAF also supported the Siembra tu empresa (Sow your enterprise) project led by the Neo Empresa Foundation, whose objective is to start the first company incubator in La Paz department. In a complementary action, the National Support System for University Undertakings - Bolivia Emprende project began with the aim of stimulating the creation of entrepreneur support centers in public and private universities around the country.

In the area of cultural and community development, CAF supported projects to generate social capacity and promote social responsibility and social capital. Especially important was the Music Program in its orchestra, choral and lute sections, along with sports training in Santa Cruz, La Chiquitanía, El Chaco, and El Alto. In productive community management, important progress was achieved with the projects approved, especially community tourism with support from the native authorities in Uyuni, Viacha, Tiwanaku, and South of Lake Titicaca, and in the work with the Calamarca and Morochata communities on two projects to facilitate and organize the demands of the population for basic public services, particularly health and education; in which local people were trained in matters related to these services with a cultural and gender approach.

Lastly, in the Governance Program, projects were designed to develop the Land Register Base Survey in Municipalities. Also, this year the new Institutional Strengthening Program was implemented with the objective of improving the system of sectoral regulation, reforms, decentralization, civic education and constituent processes. In another development, execution continued of the second phase of the programs of Governance and Political Management, Leadership for the Transformation, and Efficient and Transparent Municipalities (MuNet).