OPEC Fund loan to support SMEs and agriculture in Paraguay
VIENNA, 13th October, 2021 – The OPEC Fund for International Development (OFID) has announced the signing of a US$30 million term loan agreement with Banco Regional of Paraguay for on-lending to small-and medium-sized enterprises (SMEs), particularly agribusinesses that have been severely disrupted by economic slowdowns as a result of the COVID-19 pandemic.
Agribusiness is a key economic driver of Paraguay’s economy and food exports are the main source of the country’s foreign currency.
The sector is composed primarily of agro-related SMEs, generating over 80 percent of employment.
According to a press statement issued by OFID, the loan will help Banco Regional to address the SME’s needs for liquidity caused by business interruption in connection to the partial COVID-19 lockdown.
Speaking on the occasion, OPEC Fund Director-General Abdulhamid Alkhalifa said, “Building on our strong partnership with Banco Regional, we will provide access to finance for small and medium sized businesses, particularly in agribusiness, a vital sector for Paraguay’s economy.
This will help to increase Paraguay’s links to global value chains, support exporting SMEs and protect employment in related industries.
This is the third facility the OPEC Fund has extended to Banco Paraguay.
Proceeds from the first loan were used to on-lend to 36 sub-borrowers in the agriculture sector.
The second facility provided 53 sub-loans to Paraguayan enterprises for international trade finance purposes, pre-export finance of cash crops and import of agricultural supplies and machinery.
The OPEC Fund has supported Paraguay’s development focused goals for over 40 years and financed projects in sectors including the financial, transportation, energy and agriculture through its public, private and trade finance, and grants operations.
The Fund was established in January 1976 by the then 13 member countries of OPEC; including the United Arab Emirates.
It is the development finance institution established as a channel of aid to developing countries.