-to combat impact of global crisis
Guyana and three other countries will be able to more funds for the next two years from the Inter-American Development Bank (IDB) to help overcome the effects of the global economic crisis.
Guyana will be able to borrow up to US$28.6 million per year from the current US$20.6M.
A press release from the Bank yesterday said that Guyana, Bolivia, Honduras and Nicaragua will collectively have access to up to $485 million in lending resources per year from the Bank during 2009 and 2010, to help these countries overcome the effects of the global economic crisis.
By increasing the concessionary funds available for these four countries through a supplementary allocation, total IDB lending can expand 39 percent, from $349 million per year in 2007 and 2008, to $485 million per year in 2009 and 2010, the statement said.
The supplementary resources will enable Bolivia to increase its borrowing from the IDB from US$113.2 million to US$157.4 million yearly during 2009–2010. Honduras will be able to borrow US$165.7 million yearly during this period, up from the previously approved limit of $119.2 million. For Nicaragua, the limit will rise to US133.5 million from US$96 million. The supplementary allocation of $136 million, approved by the Board on May 20, is a temporary measure for the next two years while longer-term solutions are sought for providing concessional funds to the Bank’s poorest member countries. It expands the total lending amount for 2009 and 2010 that the Board had approved for the four countries earlier this year, the Bank said.
It stated that the IDB’s Board approved the measure after considering a careful analysis that indicated that these four countries have the capacity to take on the additional debt without deepening their risk of debt distress, and that the additional lending would not threaten the long-term sustainability of the Fund for Special Operations (FSO).
It was noted that the IDB lends to these four countries with a blend of resources in which loans from its Ordinary Capital are made available together with resources from the FSO, “in proportions designed to balance each borrower’s needs with its long-term capacity to absorb additional debt productively.”
“This crisis is inflicting real hardship on working families in our member countries,” IDB President Luis Alberto Moreno was quoted as saying. Moreno was speaking yesterday in Honduras, where he is attending the Organisation of American States General Assembly. “These resources will give the governments of Bolivia, Guyana, Honduras and Nicaragua additional flexibility to finance countercyclical policies and strengthen social safety nets for their most vulnerable citizens”, he added.
