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IDB approves $240 million to strengthen credit in Chile for small and medium-sized enterprises

The Inter-American Development Bank today announced the approval of a $240 million loan to Chile to strengthen the availability of medium- and long-term credit for small- and medium-sized enterprises, increasing productive investment in the private sector and improving export capacity through gains in competitiveness.
The resources, which will be administered by the Corporación de Fomento de la Producción* as a second-tier financial institution, will enable the firms to receive funding for investment and related working capital requirements in such areas as machinery and equipment, construction, exports, and leasing.
The loan, the largest to Chile by the IDB since 1990, is designed to increase output and employment. It will encourage the financial system to grant more credit to small- and medium-sized businesses, enabling firms to introduce modern technologies into the productive processes.
The total cost of the program is $400 million.
The IDB loan is for a 20-year term, with a four-year grace period, at the variable interest rate, now 6.98 percent. Local counterpart funds total $160 million.

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