“Given the success of the operational programs developed with the countries and in response to the growing investment demands, the ministers announced the decision to strengthen Fonplata’s lending capacity by accelerating the integration of capital,” said the regional development incentive fund. in a statement released at the end of the meeting.
The governors of Fonplata highlighted in the final document of their meeting “the challenges overcome to turn the institution into a relevant, agile and efficient tool prepared to accompany the development and integration of the region”.
A concession fund was also announced in the Board of Governors to establish preferential rates in support operations for Bolivia, Paraguay and Uruguay, with the objective of compensating the asymmetries of Bolivians and Paraguayans in particular and, to a lesser extent, of Uruguayans, in front of to the giants Brazil and Argentina.
The Fonplata executive president, Juan Notaro Fraga, told Efe that in the case of Paraguay and Bolivia the compensation with the preferential interest rates for the credits will be 75%, while for Uruguay it will be 50%.
This mechanism of compensation was defined by the governors as “a tool of partnership for solidarity” in order to favor the “least developed” countries.
The delegates from Bolivia, Brazil and Uruguay announced at the meeting that their respective countries completed the internal processes for the subscription of approved capital together with the restructuring of the fund in 2012, two of them even with the respective approval in the national congresses.
Argentina and Paraguay, for their part, continue to make progress in the corresponding legislative processes, and approval is expected in the coming months.
The governors approved the report and the 2013 Balance of the entity and analyzed the results of the management that gave “priority” to the “focus of favoring the countries and geographic areas of less development”.
Since the last Board of Governors, held in June 2013, five projects were approved for 125 million dollars (91,667,100 euros) for Argentina and Bolivia, and before the end of the year the approval of seven more operations is expected for 225 million of dollars (165 million euros) for the five member countries of the fund.
At the meeting, the Brazilian Minister of Planning, Miriam Belchior, assumed the Presidency of the Assembly of Governors, which was chaired by her Bolivian counterpart Viviana Caro.
The Minister of Finance of Paraguay, Germán Rojas Irigoyen, also participated in the meeting; the head of Economy and Finance of Uruguay, Mario Bergara Duque, and the director of Projects with International Credit Organizations, of the Ministry of Economy and Public Finance of Argentina, Ignacio Negroni.
In his speech, Belchior stressed that “an important step was taken in the direction of the institutional transformation of the Fund”, while Bergara stressed that “operating in specific financing niches allows Fonplata to interact with other financial organizations in projects of small amounts” .
Projects that, according to the Uruguayan minister, despite their small amount, are “important for our countries” and, at the same time, allow “to be integrated into the new regional architecture”.
Negroni said that “the strength of the organization today is due to the absence of external constraints given its status as a financial institution of regional development,” while Caro said that the Fonplata “has developed a very important and very rapid response capacity.”
The fund, in Caro’s opinion, “is filling a space for funding for the five countries that were needed.”
Parallel to the Board of Governors, a $ 25 million (€ 18,333,400) financing contract was signed at the São Paulo meeting for the construction of a second road section of the Santa Cruz de La Sierra-Cochabamba Bolivian route. between Puente Mariposas and Puente Chimoré.
The contract was signed between the Bolivian minister and the president of Fonplata.
The Fonplata, based in the Bolivian city of Santa Cruz de la Sierra, was created in 1974 to provide financial and technical support in the region.