US$672 million for projects in Argentina

(Buenos Aires, July 29, 2010).– In the presence of the president of the Republic of Argentina, Cristina Fernández de Kirchner, CAF President and CEO Enrique García and Amado Boudou, minister of Economy and Public Finance, signed five loan agreement for a total of US$292 million. The ceremony took place in the Casa Rosada, seat of government. In addition two significant approvals were announced for US$380 million which relate to projects in favor of the development of Argentina financed by CAF with total value of US$672 million.

García said, "the projects we support respond to the priorities set by the Argentine government in the areas of social development, technology, education, infrastructure, energy, and regional integration." "The CAF contribution to the actions executed by this member country in favor of its integrated development is reflected in the total of over US$2.70 billion which has been approved for Argentina since its entry as shareholder."

Social projects for more vulnerable populations

In the social area, two agreements were signed for a total of US$135 million: Program for Multiple Works in Municipalities for US$100 million, and the University Infrastructure Expansion and Improvement Program for US$35 million.

"These operations consist of programs to improve the living conditions of low-income populations which are the most vulnerable" García said.

The US$100 million loan for the Program for Multiple Works in Municipalities aims to improve the quality of life of their inhabitants by financing minor infrastructure works with strong social impact, which facilitate equity and regional development.

The agreement to finance the University Infrastructure Program totals US$35 million and covers 28 infrastructure works to be executed in 23 national public universities, benefiting approximately 250,000 students, 20% of the enrolment in national public universities.

Power supply and technology projects also receive finance

To expand the scope of the electricity service in Argentina, an agreement was signed for US$84 million for the Program to Supply Electricity to the Regions of the Country, which will fund projects to expand the power transport system.

The works to be executed consist of construction, overhaul and expansion of 132 kV transformer stations and construction of 132 kV high-voltage lines in various regions of the country. The total cost of the program is estimated at US$120 million, of which US$36 million (30%) will be financed from own funds and US$84 million (70%) by the CAF loan.

To finance pre-investment studies for structuring the projects in the energy sector, a fourth loan agreement was signed for US$37.7 million to be executed over the next few years. Of the total amount of the Program (US$42 million) 75% is specifically for engineering studies for hydroelectric development, some of them binational on the border with Brazil.

Lastly, with a view to promoting technological development, which is a CAF priority objective in its Agenda in support of Latin American countries, a US$36 million agreement was signed to partially finance the Argentine Geostationary AR-SAT Satellite Project with a total cost of US$723 million.

The project involves design, construction and placing in orbit of a fleet of three geostationary satellites. With this system, Argentina will have the capacity to place its own satellites in geostationary orbits which will provide the full range of services now offered by industry.

Announcement of approvals for US$380 million

In addition, the two loan approvals announced during the signing relate to the Project to Extend the Useful Life of the Embalse Nuclear Plant (CNE) for US$240 million, and the Regional Road Development Program for US$140 million, whose agreements will be signed shortly.

On the approval for the nuclear plant extension project, García said the loan would lengthen the life of the Embalse Plant in support of the Argentine government plans in the field of energy generation. The extension will improve the quality of life of approximately 3.5 million people who use the power generated by the plant, and favor development of the science and technology system in Argentina.

Finally, with the idea of financing new and upgraded roads in Chaco, Misiones and Formosa provinces, CAF approved a US$140 million loan for the Argentine Republic for the regional road development program whose objective is to contribute to the socio-economic recovery of the northern provinces by facilitating their integration through investment in provincial, regional and international productive roads.