Announcement of World Bank Lends Fifteen Million Dollars for Industrial Credit Project in Costa Rica on June 19, 1978

FOR IMMEDIATE RELEASE-. 1 •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 BANK NEWS RELEASE NO. 78/118 JUNE 19 , 19 7 8 WORLD BANK LENDS $15 MILLION FOR INDUSTRIAL CREDIT PROJECT IN COSTA RI CA The World Bank has agreed to lend the Central Bank of Costa Rica (CBCR) $15 million for an Industrial Credit Project. The main objective of the project is to increase the amount of medium- and long-term credit to industry, thus providing more appropriate financing for industrial expansion than is presently available. • The project involves the establishment in CBCR of an indus- trial development fund, Fondo de Desarrollo Industrial (FODEIN), which will make medium- and long-term loans for industrial subprojects through qualified intermediary financial institutions. Labor-intensive activities and industries, especially those making use of local natural resources, are expected to be favored as a result of the economic eval- uation and appraisal process to be used by financial institutions in- volved in the project. The World Bank loan, to be guaranteed by the Government of Costa Rica, is for a term of 17 years, including 4 years of grace at an annual interest rate of 7.5%. NOTE: Money figures are expressed in U.S. dollar equivalents • • FORM NO.1121 (5-76) T ECHN I CAL • D A T A PROJECT: Industrial Credft COUNTRY: Costa Rica TOTAL COST: $49 million BANK FINANCING: $15 mi 11 ion OTHER FINANCING: (1) Central Bank of Costa Rica (CBCR), $15 million (2) Subborrowers, $14.7 million (3) Intermediaries, $4.3 million IMPLEMENTING ORGANIZATION: Banco Central de Costa Rica San Jose, Costa Rica CABLE: BANCENTRAL PROJECT DESCRIPTION: The project wil 1 involve the establishment in CBCR of an indus- trial development fund, Fondo de Desarrollo Industrial (FODEIN) which will make medium- and long-term loans for industrial subprojects through qualified. intermediary financial institutions. The project will include: (a) Term credit for fixe assets, permanent working capital, and pre-investment studies; (b) Technical assistance for FODEIN and for the staff of participating intermediaries. PROCUREMENT: The financial intermediaries and FODEIN will review procurement proposals to assure that all items are suitable for investment projects and reasonably priced, and that the beneficiaries have canvassed the main sources of supply and are purchasing from the most advantageous source. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: n.a. 1982 • - 0 -