Colombia - Agricultural Sector Credit Project

: SvAA -S 7'- S~ GZ7- Dacuwmt (f The World Bank FOR OFFCaAL USE ONLY t*'fC1.)Fli(>HE C,uPY r f vE )r T. t4o : 1 - fc 3 :f CO T( y p e P M Title AG1Q'ICULTlTrJRAL SEC'T IT C i F'F ;1 Auth, ;r: Ei'SEPPFR bW N. P-5835-. Ex:t. : :3.4Zb15. T,,r: l b:1 11l2 Dept - 3ji.3k L .3C UNORAMIO AnD RECO_EDTION OF THE PRESIDENT OF THlE INTERNhTI&L BAN FOR REOONSTRJCTONO AND DEVELOPMT TO THE EXECUTV DIRECTORS ON A PRPOSED WAN IN a MOUNT EQUxIVAINT TO US$250 MILLIOK TO THE FUD IFOR FINCING OF TH AhUICULTURL SECTOR - F GRO FOR A AGRCULTURAL SIeCTOR C PROJECT FEBRUARY 25, 1993 Tlis docnmet has a resicted disktibution and way be used by redpients only n the Pefomance of their officiAl duties. Its contents may not otherwise be disclosed without Wold Bank autbhorizatio.  5UNU }OUIVS Currency Unit - Colombian Peso (ol$) Exchange Rate (1993) uS$1.00 a 001$ 747 WEIGHUT AMD MEAAS Metric System EISCAL YRAR OF THU G0VERMINEN OF COLOMBIA January I - December 31 GLOSSARY OF ABBREVIATIONS BR - Central Bank (Banco de la Rep6iblica) CIAT - International Center for Tropical Agriculture (Centro Internacional de Agricultura Tropical) CNCA - National Commission for Agricultural Credit (Comisi6n Nacional do Cr6dito Agropecuario) DTF - Money Market Deposits (Dep6ditoe a T6rmino Fijo) 3MP - Economic Modernization Program FEDERACAFE - National Federation of Colombian Coffee Growers (F edoracion Nacional do Cafeteros de Colombia) FFAP - The Agriculture and Livestock Financing Fund (Fondo Financiero Agropecuario) FINAGRO - Fund for Financing the Agricultural Sector (Fondo para el Financiamiento del Sector Agropecuario) GDP - Gross Domestic Product ICA - Colombian Agricultural Institute - (Instituto Colombiano Agropecuario) IDEMA - Agricultural Marketing Institute (Instituto de Mercadeo Agropecuarlo) IFI - Industrial Development Instltute (Instituto de Fomento Industrial) INCORA - Colombian Agrarian Reform InstLtute (Instituto Oolomblano de Reforms Agraria) HIMAT - Colomblan Institute for Hydrology, Meteorology and Land Preparation (Instituto ColombLano do Hidrologla, Meteorologia y AdecuaclOn de TLerras) PFI - Partilcipating Financial Intermedlary PROEXPO - Export Promotion Fund (Pondo de Promoci6n de ExportacLones) QR - Quantitative Restriction SOB - Statement of Expenditure  Ii '1 VOR OFFICIAL USE ONLY AGtICllL 8 RzZIT Loa and Prosect gummary BogroMrs P'und for the Financing of the Agricultural Sector - FINGO. 6uzsantors Republic of Colombia Bnaficlgrita Farmers, farmer groups and enterprises involved in agricultural production and marketing. Loan Amounts US$250 million equivalent. Ten2s0 tTo be repald in 17 year. including 4 years of grace, at the standard variable interest rate. Onlendin= Term.s FINAGRO would onlend the proceeds of the loan to Participating Financial Intermediaries (PFF1), ln dollar. and/or in pesos, and charge: (a) for peso loans, the fully variable deposit rate of the Colombian banking system (DTF), which is presently sufficient to cover foreign exchange risk, the cross currency risk and administrative costs; the rate will be monitored and adjusted whenever the DTF is inadequate to cover the above; and (b) for dollar loans, a rate reflecting at least the Bank's Interest rate and commitment charge, plus a fee to cover the cross currency risk and administrative costs. The methodology to obtain these two rates would be consistent with that of the BR for determining its rediscount rate. Rblending rates would be determined by the PPts according to maturity, credit risk, operational costs and market conditions. i