Announcement of World Bank Supports Agricultural Credit Project in Honduras on May 23, 1983

• I') ' • .. _fQR IMMEDIATE RELEASE •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.•Telephone: (202) 477-1234 BANK NEWS RELEASE N0.83/86 Contact: Ciro Gamarra May 23, 1983 (202) 477-5320 WORLD BANK SUPPORTS AGRICULTURAL CREDIT PROJECT IN HONDURAS Approximately 36,000 persons in Honduras will benefit from an agricultural credit project that is being supported by the World Bank with a $45 million loan. About 90% of the beneficiaries belong to small-scale farming families. The $74.1 million third agricultural credit project will provide funds for a nationwide credit program to finance farm and non-farm investments in rural areas. The project will also finance short-term credit needed for working capital complementary to these investments. Through the provision of credit, to be administered by the Central Bank of Honduras, the project will further the government's objective of promoting diversification of agricultural exports as well as increasing • agricultural production in general. The project will contribute to increased incomes, and rural employment. Another important objective of the project is to ~trengthen capacity of the National Bank for Agricultural Development, the country's most important financial intermediary, and other financial intermediaries, to appraise, supervise, and collect subloans. Beneticiary small-scale farmers will be trained in managerial and accounting procedures in order to ensure the effective use of credit. Under the project, funds will be provided for incremental staffing and equipment for the Project Unit of the Central Bank of Honduras, to supervise and coordinate administration of credit by financial intermediaries. The project was prepared with the assistance of the Project Unit of the Central Bank of Honduras, and the United Nations Development Programme's Regional Unit for Technical Assistance based in Costa Rica. The World Bank loan is for 20 years, including five years of grace, at an annual rate linked to the cost of Bank borrowings. The loan also carries an annual commitment charge of 0.75% on undisbursed balnces and a front-end fee of 0.25% on the amount of the loan. • NOTE: Money figures are expressed in U.S. dollar equivalents •