Dec 2014 Financial News

IDB multi-million dollar loan to Barbados

Dec 18, 2014

WASHINGTON—The Inter-American Development Bank (IDB) says it has approved a loan of US$35 million to help boost productivity in Barbados.

The IDB said the Enhanced Access to Credit for Productivity programme will be executed by the Central Bank of Barbados in collaboration with financial institutions and small and medium-sized enterprises (SMEs).

It said the programme will contribute to increased productivity by providing a guarantee mechanism to promote investment projects facilitating SMEs’ access to medium and longterm credit, and will assist companies with upgrades to their business models.

The IDB said US$17.5 million of the loan will come from its ordinary capital and US$17.5 million from the China Cofinancing Fund for Latin America and the Caribbean.

“Finance and access to credit have an important link to productivity in Barbados. Barbadian firms need to improve their performance to preserve or increase their competitiveness, particularly in key economic sectors such as tourism.

“This programme will also allow these firms to diversify in the services, construction and manufacturing sectors. The guarantee mechanism will support those companies that are credit constrained because they did not have eligible guarantees,” the IDB said.

It said it is expected that within five years, the programme will provide over 200 new guaranteed loans for SMEs that will allow them to modernise and remodel their businesses. Each guarantee could provide coverage of up to 80 per cent of the individual loans amount for up to ten years.

The IDB US$35 million loan to be implemented in five years has an amortisation schedule of 25 years, with a five-and-a-half year grace period. (CMC)

Source:
Trinidad Guardian, A26
Thursday December 18, 2014