The European Investment Bank (EIB) and BBVA Paraguay are joining forces to provide financing to develop the projects of Paraguayan companies. To this end, the EU bank will provide a USD 35m loan, with BBVA Paraguay contributing at least a further USD 35m of its own. The contract will give Paraguayan businesses access to the EIB's favourable financing conditions in terms of both maturities and interest rates, thereby supporting their long-term investments.
The loan signed by the two institutions features the EU Latin America lending mandate 2014-2020 guarantee and will help the Paraguayan private sector to benefit from EIB financing. In concrete terms, this financing will reach agricultural, industrial and commerce sector companies. It is the first time that an EIB loan operation has been signed with a BBVA Group subsidiary in Latin America, and is also the first outside Europe, representing the consolidation of an important partnership to support businesses.
“Businesses are wealth and employment generators, which is why business sector support is one of the EIB's priorities in Latin America,” said EIB Vice-President responsible for Latin America Román Escolano. “The contract signed with BBVA Paraguay will make it possible to lend our support to local private sector development, providing Paraguayan businesses with credit on favourable terms to enable them to move forward with their projects and ensure their competitiveness.”
“With its vast experience in the business world, BBVA Paraguay will drive this initiative to provide Paraguayan SMEs and companies with more opportunities to grow and put their plans into practice. We believe that SMEs have great untapped potential. This is why we are certain that this contract will enable them to implement investment projects to stimulate the economy, resulting in more sources of employment and wealth for the country,” said BBVA Paraguay CEO Agustín Antón.
The operation signed in Paraguay comes in addition to the four the EU bank has previously signed in the country. Including its support for this project, the EIB has to date provided financing of USD 220m in Paraguay to help investment in the telecoms, energy, water supply and SME sectors.
The EIB in Latin America
The European Union is Latin America's main economic development partner and the EIB, as the EU bank, supports cooperation between the two regions by financing projects that help meet EU foreign policy objectives: economic development, social and environmental infrastructure, private sector development and tackling climate change.
The EIB provides economic support for projects in Latin America by facilitating long-term investment with favourable financing conditions and by providing the technical support needed to ensure that these projects deliver positive social, economic and environmental results.
Since the EIB began operations in Latin America in 1993, it has provided financing for 100 projects in 14 different countries in the region, with total investment of EUR 7bn. In recent years, the EU bank has provided around EUR 900m to implement projects in Argentina, Bolivia, Brazil, Ecuador, Mexico, Panama and Paraguay.