US$80 million granted to Colombia

(Caracas, May 10, 1993). -- Loans for US$80 million were approved for Colombia during the 78th meeting of the CAF Board held in Caracas, Venezuela, on May 7.

The loans for the energy and industrial sectors and multi-sector will be used for construction of a hydroelectric plant, expansion of a polyester production plant and development of various productive companies in the private sector.

URRA I One of the loans, for US$60 million, will contribute to construction of the URRA I hydroelectric plant, owned by Corporación Eléctrica de la Costa Atlántica (CORELCA), company which supplies the departments of the north coast.

The installed capacity of this plant will be 340 MW with annual production averaging 1,420 GWh. The plant is located in Cordova department on the Sinú River; its main objective is to supply power to the national interconnected system.

The total cost of the project is estimated at US$700 million and the government has already approved a US$270 million investment because the project is very important for the country and because it is part of the expansion plan for the electricity system which is currently being implemented.

URRA, SA was set up seven months ago to execute and operate this plant, which is a joint venture whose majority shareholder is CORELCA with the participation of the utility Inteconexión Eléctrica SA, (ISA) and regional organizations.

Multi-sector credit Another loan, for US$15 million, was granted to Corporacion Financiera del Valle SA (CFV), one of the largest financial institutions in the country.

Through a series of mechanisms, such as subloans, financial leases and underwriting, the CFN will grant funds for execution of investment projects involving the establishment, renovation, expansion and modernization of productive companies in the private sector.

With these actions, CAF supports and fosters investments which increase production and exports of goods and services on competitive terms in an effort to generate more sources of employment.

Industrial sector A third loan, for US$4.4 million, was approved for the project to expand a polyester filament plant, which will raise production capacity by 20% (1,500 tons more a year), giving an annual production of around 9,000 tons.

The loan was granted to Empresa Química Industrial y Textil (Quintex), one of the leading producers of synthetic fiber and filaments in Colombia.

This project will be executed in the Yumbo plant, located 150 km from the port of Buenaventura, which guarantees easy access for the export of its products.

The CAF loan, which covers 65% of the total project, will finance import of machinery and equipment from Germany and the United States, and the required working capital.