Announcement of Colombia Strengthens Small, and Medium-Scale Enterprises on March 16, 1989

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. * Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 89/37 Contact: Richard Kollodge (202) 477-4507 COLOMBIA STRENGTHENS SMALL- AND MEDIUM-SCALE ENTERPRISES WASHINGTON, March 16, 1989--Colombia is intensifying its efforts to develop small- and medium-scale enterprises (SMEs) in the industrial sector of the economy. The efforts, which will increase production and generate employment in the medium term, are being supported by an $80 million World Bank loan. Many of Colombia's small- and medium-scale industrial enterprises (including microenterprises) in the manufacturing, mining and service sectors lack easy access to institutional credit and technical support systems needed to expand their operations and boost their productivity. Under the project, eligible enterprises will be able to borrow funds from qualified development and commercial banks in Colombia to finance the purchase of machinery and equipment, construction of new facilities, and technical advisory services necessary for solving production, management, marketing and pollution-control problems. The project will also finance well-defined restructuring programs in several SMEs. Microenterprises are small, often individually or family-owned businesses --such as street vendors or one-car taxi services. Small- and medium-scale enterprises are companies with assets amounting to $1 million or less. The World Bank loan is for 17 years including five years' grace, with a variable interest rate, currently 7.65 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balance. NOTE: Money figures are expressed in U.S. dollar equivalents.