Announcement of World Bank Lends Sixty Million Dollars for Industrial Credit in Peru on April 9, 1981

FOR IMMEDIATE RELEASE eWorldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 81/ 70 April 9, 1981 WORLD BANK LENDS $60 MILLION FOR INDUSTRIAL CREDIT IN PERU A World Bank loan of $60 million to Peru will support an industrial credit project aimed at providing resources to public and private enter- prises, mostly in industry but also in the mining and tourism sectors. The Second Industrial Credit Project assisted by the World Bank in Peru consists of a line of credit of $60 million, which is expected to meet about 25% of the foreign resources for term lending required by Corporacion Financiera de Desarrollo (COFIDE) estimated demand over the next three years. COFIDE, Per6 1 s state-owned industrial development institution, will channel the loan's proceeds, either directly or through other financial in- termediaries, to the ultimate beneficiaries . • The loan will increase significantly the term financing available for investment projects in the industrial, tourism, and small-and medium-scale mining sectors. It will provide financing for an estimated 100 subprojects with total investment costs of about $120 million. The project is expected to generate about 4,000 direct jobs and also substantial indirect employment. The project will also contribute to the institutional strengthening of PerG's term-financing subsector by supporting the reorganization of COFIDE, further developing the project appraisal capabilities of COFIDE and other participating financial intermediaries, and promoting competition among the financial intermediaries. The World Bank made its first industrial credit loan, of $35 million, to COFIDE in December 1976. Under this project, 71 subloans for a total of $31.9 million have been approved thus far. Most subprojects were in export- oriented activities, particularly in the textlle, metal, and fish processing industries. The $60 million World Bank loan to COFIDE has the guarantee of the Republic of Peru. It is for a term of 17 years, including 4 years of grace, with in- terest at 9.6% per annum. • NOTE: Money figures are expressed in U.S. dollar equivalents.