CABEI approves US$50 million for COVID-19 emergency to the Republic of El Salvador
The financing will support the Government in its efforts to implement health prevention and containment measures in order to prevent the spread of the COVID-19 pandemic.
Tegucigalpa, May 8, 2020 - The Central American Bank for Economic Integration (CABEI) approved US$50 million in financing to the Republic of El Salvador in order to partially reimburse the expenditures made through the granting of the monetary compensation bonus to unemployed and economically disadvantaged people affected by the pandemic; the latter was carried out within the framework of measures implemented to deal with the COVID-19 emergency in the Republic of El Salvador.
The operation falls under the framework of CABEI's Regional COVID 19 Support, Preparedness and Economic Reactivation Program, specifically its component No. 3. Credit to Finance Public Sector Operations.
The program aims to provide rapid financial resources and disbursements to the countries of the Central American Integration System (SICA) and other extra-regional countries to finance operations for the prevention, detection and treatment of COVID-19, while mitigating its economic impact on countries.
CABEI Executive President, Dr. Dante Mossi, stated that, “We are living through a huge challenge, the Bank's priority is to support countries to overcome the crisis. As the Bank of Central America, which was created by Central Americans to foster the region's development, CABEI is committed to responding promptly and quickly to requests made by its member country to deal with the economic consequences of the coronavirus pandemic."
Salvadoran Minister of Finance, Attorney Nelson Fuentes, highlighted the importance of this financing for the Government, taking into consideration the financial challenges of the State as a result of the COVID-19 Emergency and emphasizing that the resources resulting from this loan will form part of the country's Economic Emergency, Recovery and Reconstruction Fund and will be aimed at complementing the integral financing for actions in benefit of the population in the framework of the national emergency.
Attorney Fuentes thanked CABEI for its streamlined support to the country, especially during this crisis, in which the support of Multilateral Banking Institutions by means of concessional loan conditions becomes key for the countries of the region.
The loan was approved for a term of up to 20 years, including a five-year grace period and a six (6) month LIBOR interest rate, which will be revisable and adjustable on a semi-annual basis; the initial margin established by CABEI will be one hundred and seventy-five (175) basis points.