30.05.95.MIF APPROVES US$3,949,000 FOR WORKER RETRAINING IN ECUADOR

MIF/AT40-41                             Carlos Brezina  (202) 623-1360
NR-115/95                                  E-mail:  carlosbr@iadb.org


FOR IMMEDIATE RELEASE                                        May 30, 1995


       MIF APPROVES US$3,949,000 FOR WORKER RETRAINING IN ECUADOR

       Support for former employees of government agencies


     The Multilateral Investment Fund today announced the approval of two
nonreimbursable financings to Ecuador: $3,949,000 for a program to
provide assistance and training to workers displaced from state-owned
companies and $1,620,400 for a program to promote private-sector
participation in the transportation sector.

Worker assistance and training

     The worker assistance and training program will benefit 4,000
workers displaced from four state-owned companies.  It will also
alleviate the social costs of the process of privatization, modernization
of the state and economic reform undertaken by the government, and
promote efficient job retraining nationwide.
     Participating in the program will be Empresa Nacional de
Ferrocarriles, Autoridad Portuaria de Guayaquil, Empresa Nacional de
Correos, and Empresa Municipal de Agua Potable-Quito.  Employees will be
selected with direct input from worker adjustment committees within these
companies.
     Fundaci¢n Ecuador, a national association representing all areas of
business, will carry out the program with assistance from various private
organizations, business associations, foundations, and consulting firms.
     Pilot programs for worker retraining have previously been approved
by the MIF for Colombia, Chile, Per£ and Uruguay.

Private participation in transportation

     The MIF's resources support the government's plan to update and
privatize the country's infrastructure, which calls for private funds to
be used in construction and operation, and encourages competition and
efficiency to benefit users.
     In the area of ports, technical assistance will be provided in
support of concessions and privatization of services for ships and cargo
in Guayaquil, Manta, Bolçvar and Esmeraldas, as well as setting
competitive rates for each port, and strengthening the regulatory and
oversight capacity of the appropriate authorities.
     The concession system will be applied to highways, and regulatory
and oversight capabilities will be strengthened within the state agencies
administering the system.
     A plan will be drawn up to modernize the airports while preparing
concession and privatization contracts, designing a rate structure suited
to private participation, and strengthening the Civil Aviation Division.
     The National Council on State Modernization will execute the
program, at a total cost of $2,424,400 with a local contribution of
$804,000.

     The MIF is an autonomous fund administered by the Inter-American
Development Bank.  It provides loans, grants, and investments for
private-sector promotion, small business and microenterprise development,
and job training in Latin America and the Caribbean.