Central American Bank for Economic Integration and Spain's Official Credit Institute will promote projects in Central America
Through an agreement signed for US$150 million in financing, it is expected that the financial needs of Spanish companies located in CABEI member countries will be met.
Madrid, Spain, February 16th, 2023.— In support of Spanish companies located in the countries of the region, the Central American Bank for Economic Integration (CABEI) and the Official Credit Institute ("Instituto de Crédito Oficial" or "ICO") signed a US$150 million financing agreement. This action will make preferably green and/or sustainable investment projects eligible, in addition to supporting business activities and companies' liquidity needs.
Also, it will promote projects that contribute to combating climate change, sustainable development, growth, wealth distribution and job creation, as well as those initiatives that are aligned with the Sustainable Development Goals (SDGs) established by the United Nations General Assembly.
The contract was signed in CABEI's new representative office in Madrid by CABEI Executive President, Dr. Dante Mossi, and ICO President, José Carlos García de Quevedo, who emphasized that this agreement will allow CABEI to channel new resources to increase trade between Spain and Central America.
"The signing of this new Credit Line demonstrates the strength of the relationship between CABEI and ICO, and constitutes the fifth agreement reached between both entities since 2017, managing to support Spanish companies in the region with financing for more than US$414 million. Therefore, we are confident that with this agreement we will continue to benefit both local and Spanish companies, so that they can increase their trade relations, promote investment and operations that include climate change mitigation and adaptation actions," said CABEI Executive President, Dr. Dante Mossi.
The president of ICO, José Carlos García de Quevedo, stressed that "the ICO Group is firmly committed to contributing to and supporting the internationalization of Spanish companies and promoting their investment and development plans in Latin America. Therefore, as a National Promotion Bank, at ICO we innovate with products that promote sustainable economic growth and a green transition so that the self-employed, SMEs and entrepreneurs can carry out projects that generate a positive impact both from a social and environmental point of view."
Financing to companies will be channeled through Intermediary Financial Institutions established in these countries or directly to specific CABEI projects. Likewise, framed within the ICO International Channel Line and the first agreements, signed between 2017 and 2020 for US$ 264 million, have enabled the financing of 44 projects in the region, of which 19 have been classified as sustainable. The agreements between the two institutions demonstrate geographic diversification by supporting projects in Central American countries such as Costa Rica, El Salvador, and Nicaragua. Eighty percent of the projects financed under the CABEI-ICO alliance have been for projects of less than US$13.6 million, demonstrating the great capillarity of the financing.
ICO Line International Channel
The International Channel Line aims to promote the activity and financing of projects of companies with Spanish interest with international presence in third markets, through intermediation with institutions. Since the launch of this financing program in 2015, ICO has signed 30 financing agreements corresponding to 16 different counterparties, with a formalized amount of more than 3,000 million euros.
This program transfers the operating scheme of public-private collaboration of the ICO Lines to multilateral banks, public promotion banks or private banks located abroad. In this way, it facilitates the application procedures for companies and incorporates the entity's knowledge of the local market as an added value. In addition, it allows Spanish companies and self-employed individuals to undertake their business activities in third markets with the possibility of financing in local currency in the countries where the investment projects or commercial activities are carried out.