CAF Granted a Loan to Venezuela to Provide Macroeconomic Support

The Central Bank of Venezuela (BCV) received a loan for 500 million dollars from the development bank of Latin America-CAF (Andean Development Corporation) “to mitigate liquidity risks and provide macroeconomic support,” said a statement released Monday by the multilateral agency, replicated by Reuters.

The Development Bank of Latin America – CAF, through loans and other mechanisms, supports models of sustainable development, technical and public restructuring, public and private in Latin America and the Caribbean. One of the main focuses of the multilateral financial institution are credits for infrastructure development.

The Andean Development Corporation, which has a headquarters in Caracas, is made up of 17 countries in Latin America and the Caribbean region, as well as Italy and Portugal. It’s supported by 13 private banks. It provides multilateral financial support, as well as for the generation of knowledge in the region.

The Reuters note indicates that the loan that Venezuela has just received for 500 million dollars is the second time in two years that CAF has granted financing to the Central Bank of Venezuela. “The previous loan, granted in December of 2017, was for 400 million dollars,” the agency reports.

Previous loans

The Development Bank of Latin America-CAF, has delivered other financing to Venezuela for various projects in strategic areas such as electricity.

In 2011, it approved a loan of 380 million dollars for the modernization of six Guri hydroelectric generation units. These resources were combined with financing from the Inter-American Development Bank (IDB) for the same project in the hydroelectric sector.

In that opportunity authorities of the Development Bank of Latin America, indicated that the credit would be destined to the improvement and reliability of the supply of the Venezuelan electrical system, for that reason “the CAF puts at the disposal of the government resources to advance the improvements that seek to extend the life of the Simón Bolívar Hydroelectric Plant.”

“For CAF it is important to have the opportunity to contribute with a strategic project of high impact for the energy security of one of its member countries: Venezuela,” said the multilateral organization.

The project financed by the CAF included the replacement of turbines by new units with more efficient technology and the execution of several complementary works.

The CAF has approved loans for 1,700 million dollars for the other three hydroelectric plants in Venezuela such as Macagua, Caruachi and Tocoma.

Source URL: Alba Ciudad

Translated by JRE

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