27 September 1999
Multilaterals To Provide Colombia With Massive Loan Package
(Package will provide loans for 2000-2002) (300)
Washington -- A group of multilateral lending institutions has agreed
to provide Colombia with $4,200 million in loans for the next three
years in support of a program to "restore confidence and reinvigorate
the Colombian economy," the Inter-American Development Bank (IDB)
announced.
The IDB will contribute $1,700 million, the World Bank $1,400 million,
the Andean Development Corporation $600 million, and the Latin
American Reserve Fund $500 million from 2000 through 2002, the IDB
said in a September 27 statement.
A substantial part of these funds will be allocated to finance a
social safety net, the IDB added. In that connection, the IDB said
Colombia has agreed to expand social spending by $900 million over the
next three years.
The IDB said the social safety net program "will mitigate the effects"
of Colombia's economic recession, "which has led to mass unemployment,
a drop in the living standards of the most vulnerable sections of
Colombian society and increased internal conflict."
The multilateral package, the IDB said, will help finance the
following priority activities: emergency employment generation,
training, attention to displaced families, and special programs for
youth and the elderly.
The IDB said the multilateral financial institutions "reiterate their
support for the wide-ranging reform strategy on which the Colombian
government has embarked. In particular, they express their highest
confidence in the fiscal, financial and social reforms being
implemented" and the government's effort to set the groundwork for
lasting peace in the country.
In addition to these loans, news reports said Michel Camdessus,
managing director of the International Monetary Fund (IMF), will
propose to the IMF board of directors a $2,700 million Extended Fund
Facility for Colombia.
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