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IDB supports small firms in El Salvador

In April 2002 the IDB approved a $42.4 million loan to the Multisector Investment Bank of El Salvador to provide long-term credit to the private sector enterprises with a view to increasing their competitiveness and productivity.

The Multisector Investment Bank (known for its Spanish initials, BMI) will on-lend resources to intermediary financial institutions that, in turn, will provide credit to urban as well as rural firms. The credits will be available to both start-ups and existing companies in the manufacturing, trade and service sectors.

Salvadoran companies will be able to use the resources to invest in fixed assets; obtain working capital for the expansion; restructure or modernize production facilities; and hire technical and managerial services. A technical assistance component of the program will help to strengthen the institutional capacity of the BMI to access domestic and international capital markets. The program will also help intermediary financial institutions to conduct credit risk analysis and expand financial services in rural areas.

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