Government: World Bank Loan To Bring Big Savings

June 25, 2010

Costa Rica is on its way to approving a World Bank credit line that could save the country as much as $70,000 a day, the government said Wednesday.

The World Bank’s $500 million development policy loan passed first debate in the Legislative Assembly Tuesday, with approval from 42 of the 46 lawmakers present. The policy loan bill is expected to pass in the second, final vote on Thursday.

“The political will is clear from all the parties to seek urgent solutions for the country,” Marco Vargas, minister of the presidency, said in a statement.

He explained that the savings were calculated by President Laura Chinchilla’s economic advisers based on the new resources the credit line would free up “to achieve important progress for the country,” according to the statement.

The World Bank approved the loan in April 2009, authorizing its International Bank for Reconstruction and Development to disburse $500 million in one tranche, payable in 30 years, including a five-year grace period.

The loan is meant to bolster Costa Rica’s public finances and competitiveness “with respect to infrastructure shortcomings, skills gaps and excessive red tape,” the World Bank said in a statement to publicize its approval.

Just as global economies were buckling last year, in February 2009, the World Bank’s vice president for Latin America, Pamela Cox, visited this Central American country and announced plans to offer the loan “to give help to the government in this difficult time,” she said (TT Daily News, Feb. 12, 2009).

However, it has taken the legislature until now to give the funds the go-ahead. The offer was met with some skepticism.

“We’re swiping a credit card we can’t afford to pay,” Luis Barrantes, then legislator with the Libertarian Movement Party, said at the time of Cox’s visit.

In an interview with The Tico Times, Cox stressed that the World Bank does not add conditions on development policy loans, other than the promise from the country to repay and not misuse the money.

–Alex Leff

Facebook Comments

You may be interested

Pic of the Day: Costa Rica’s Isla Nublar (aka Cocos Island)
Pic of the Day
66 views
Pic of the Day
66 views

Pic of the Day: Costa Rica’s Isla Nublar (aka Cocos Island)

Alejandro Zúñiga - April 18, 2019

Isla Nublar, the setting for much of the "Jurassic Park" series, is unfortunately not a real Costa Rican island. Cocos…

Costa Rica holds Maduro regime responsible for diplomat’s safety
Costa Rica
11 views
Costa Rica
11 views

Costa Rica holds Maduro regime responsible for diplomat’s safety

AFP and The Tico Times - April 18, 2019

The Costa Rican Foreign Ministry said on Wednesday that it places responsibility with the Venezuelan government of Nicolás Maduro for…

Venezuela withdraws diplomatic credential from Costa Rican diplomat
Latin America
25 views
Latin America
25 views

Venezuela withdraws diplomatic credential from Costa Rican diplomat

AFP and The Tico Times - April 17, 2019

Venezuela withdrew the diplomatic credential from the Costa Rican chargé d'affaires on Tuesday in retaliation for the country’s acceptance of…

Do NOT follow this link or you will be banned from the site!