14 February 2002

U.S. Firm, World Bank Sign Deal To Fight Rural Poverty in Latin America

$20 million credit line to support region's agricultural sector

Washington -- The private sector arm of the World Bank has signed an agreement with a Florida agribusiness lender for a $20 million credit line to support small and medium agricultural export firms in areas of Latin America suffering from high unemployment and poverty, the Bank announced.

In a February 14 statement, the Bank said the agreement between its International Finance Corporation (IFC), composed of 175 countries including the United States, and the Latin American Agribusiness Development Corporation (LAAD), based in Coral Gables, Florida, will aid firms in the region engaged in agriculture, livestock, fishing, and forestry.

The Bank said a large part of Latin America is devoted to production of crops and livestock, which means the agricultural sector is playing a crucial role in generating income and employment opportunities in the region. The agricultural sector often accounts for as much as half or more of the gross domestic product and 60-80 percent of total employment in countries with low per capita incomes, the Bank added.

LAAD was created in 1970 to fight depressed conditions in rural areas of Latin America. The Bank said LAAD is one of the very few financial institutions exclusively targeting the agricultural sector, having disbursed more than $375 million to over 750 agribusiness projects in 18 countries in Latin America.

LAAD president Benjamin Fernandez said the projects financed with the IFC credit line "will generate foreign exchange and create jobs in rural areas (of Latin America) where unemployment has been traditionally high."

The IFC's Bernard Pasquier said his agency was "proud to support a successful and efficient agribusiness lender to leverage our funds throughout the region, strengthen the export capacity of our member countries, and promote sustainable practices in agribusiness production."

The IFC was created in 1956 to promote private sector investment in the developing world as a way to create job opportunities and reduce poverty.