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- OPEC Fund supports post-COVID-19 economic recovery of MSMEs in El Salvador
OPEC Fund supports post-COVID-19 economic recovery of MSMEs in El Salvador
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October 13, 2021: The OPEC Fund for International Development has signed a US$35 million loan agreement with Banco de Desarrollo de El Salvador (BANDESAL) to support the post-COVID-19 economic recovery of El Salvadoran micro-, small-, and medium-sized enterprises (MSMEs). BANDESAL is The Development Bank of the Republic of El Salvador and particularly focuses on lending to MSMEs for boosting development and business resumption of productive sectors affected by the COVID-19 pandemic.
The OPEC Fund’s loan will provide credit lines to finance existing and new businesses and is expected to help create more than 4,500 new jobs and preserve 8,000 existing jobs across all sectors. SMEs in the Latin America region comprise as much as 99.5 percent of all businesses; generate 60 percent of the employment, and 25 percent of the GDP.
The agreement was signed at a virtual ceremony by El Salvadoran Finance Minister Alejandro Zelaya, BANDESAL President Juan Pablo Durán and the OPEC Fund Director-General Abdulhamid Alkhalifa.
Juan Pablo Durán, President of BANDESAL said: “At BANDESAL we are contributing to the economic revitalization by providing new financial and non-financial alternatives that allow SMEs to restore their economic activity and continue to generate a great impact on the El Salvadoran economy and society. Aligned with the government of El Salvador, led by President Nayib Bukele, we will continue to seek innovative and easily accessible tools for the SMEs.”
OPEC Fund Director-General Abdulhamid Alkhalifa said: “We are pleased to partner with BANDESAL, the government of El Salvador and other international development finance institutions in a collective effort to provide much-needed funding and liquidity to small and medium businesses in the country. By joining forces through cooperation, we are bolstering the economy and helping El Salvadorans to sustain and revive their businesses and jobs.”
Other co-financiers include the World Bank, the Inter-American Development Bank (IDB), the Central American Bank for Economic Integration (CABEI) and the European Investment Bank (EIB).
In March 2020, the OPEC Fund launched its US$1 billion COVID-19 response program, and has so far approved more than US$865 million in private sector and sovereign loans. Some of these loans focused on emergency response, such as a US$15 million loan to the Ministry of Health of El Salvador, supporting the government’s pandemic related expenditures. Other COVID-19 financing helped to sustain employment, create new jobs, promote international trade and increase connectivity.
About the OPEC Fund
The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively. The organization works in cooperation with developing country partners and the international development community to stimulate economic growth and social progress in low- and middle-income countries around the world. The OPEC Fund was established by the member countries of OPEC in 1976 with a distinct purpose: to drive development, strengthen communities and empower people. Our work is people-centered, focusing on financing projects that meet essential needs, such as food, energy, infrastructure, employment (particularly relating to MSMEs), clean water and sanitation, healthcare and education. To date, the OPEC Fund has committed more than US$22 billion to development projects in over 125 countries with an estimated total project cost of US$187 billion. Our vision is a world where sustainable development is a reality for all.