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IDB approves $8.4 million to improve job training employment market in Panama

The Inter-American Development Bank today announced the approval of a $8.4 million loan to Panama to build a job training and placement system that will improve the employment prospects for youth and enhance the skills and competitiveness of workers in microenterprise and in the small and medium-sized business sector.

In addition, the Labor Ministry* and other agencies operating in the labor market sector will be modernized and strengthened to achieve better operational, strategic planning and technical capabilities.

The public and private employment and job intermediation systems will be synchronized through the creation of an employment services network and a Consultative Job and Workforce Development Council.

The program is designed to create an employment and training system capable of meeting the country’s development and labor market demands.

Approximately 7,000 youths will be given training for work-force entry, and another 4,400 will receive employment counseling for the selection of education or career paths. Training will also be provided to an additional 200 persons who are occupationally disadvantaged.

Private service providers will be encouraged to furnish demand-driven job counseling, training and placement services to improve the quality and efficiency of the programs.

Matching funds will be granted to approximately 420 enterprises for in-service training designed to increase the firms’ competitiveness and provide new skills to 5,400 workers.

The program reflects a strategy jointly agreed upon by the IDB and the government of Panama to strengthen the competitiveness of the private sector and increase the efficiency of social investments, reducing the percentage of households living in poverty from 37 percent to 27 percent by the year 2004.

In recent years the IDB has supported several labor market programs in Latin America and the Caribbean. Last week the Bank approved a loan to Guatemala to strengthen employment services and training.

The loan to Panama is for 25-year term, with a three-year grace period, at the variable interest rate, now 6.19 percent. Local counterpart funds total $2.1 million.

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