Announcement of Five Million Twenty-Five Hundred Thousand US Dollars for Pre-Investment Studies in Chile on February 7, 1974

WORLD BANK • 1818 H STREET. N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 Bank Press Release No. 74/6 Subject: $5.25 million for pre-investment February 7, 1974 studies in Chi le The World Bank is providing Chile with $5.25 million to cover the foreign exchange costs of carrying out pre-investment studies. Discussions of assistance for the pre-investment studies began under the late President Salvador Allende's Government in March and April 1973. In June of last year the former Chilean Government requested assistance to prepare the program and a Bank mission was sent to Chile in July for that purpose. Negotiations were completed in late August and the proposed • agreement was distributed to the Bank's Board of Executive Directors in September. The new Chilean Government which took power later in September 1973 in- dicated its interest in proceeding with the agreement on the basis of the conditions discussed earlier with the Bank. Negotiations were resumed towards the end of 1973. In the interim the new Government has worked out a short- term financial and economic program for which it has requested and obtained a stand-by arrangement from t~.1e International Monetary Fund. The Bank participated in the Fund mission to Chile to review the country's position and discuss the stand-by agreement. A Bank mission is planned for mid-Fehruary to review Chile's long-term policies and programs. In the pre-investment studies high priority will be given to the prepa- ration of projects in sectors such as mining, metallurgy and manufacturing, • n~trition and fisheries, transportation, and water planningo will be aimed at expanding exports and saving foreign exchange expenditures, at the same time aiding the country's economic growth and social well being. These projects /more Note: Money figures are expressed in US dollar equivalents  - 2 - Total cost of the study program is estimated at $10.S million, of which $5.25 million will be in foreign exchange. The Bank's financial contribution • will cover foreign exchange costs relating to consultants' services and equipment for the different studies which are likely to be supplied from abroad. Several agencies of the Chilean Government will be responsible for the exncution of the pre-investment studies. The coordinating agency will be the Corporacion de Fomento de la Produccion (CORFO -- the Chilean Government Development Corporation). The funds are being made available to CORFO for a term of 20 years, including five years of grace, at 7-1/4% annual interest. • - 0 - •