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Inter-American Development Bank to increase loans to Argentina
September 11, 2017 / 8:23 PM / 14 days ago

Inter-American Development Bank to increase loans to Argentina

BUENOS AIRES, Sept 11 (Reuters) - The Inter-American Development Bank (IADB) will likely lend more to Argentina between 2016 and 2019 than the $6 billion initially anticipated, Finance Minister Luis Caputo said on Monday, as the country ramps up borrowing and infrastructure investment.

The multilateral lender will nearly reach that initial target for President Mauricio Macri’s term at the end of 2018, IADB President Luis Moreno said in a joint press conference during a visit to Buenos Aires, with loans totaling $1.2 billion in 2016, $2.3 billion in 2017 and $2.35 billion in 2018.

“I dare say that in 2019 as well the floor will be another $2.3 billion,” Caputo said, noting that including loans from the IADB’s private arm directly to companies, total financing will reach $10 billion by the end of Macri’s first term in 2019.

Institutions like the IADB and World Bank stepped up lending to Argentina after the country settled a long-running dispute with holdout creditors last year, exiting default and paving the way for a return to global credit markets. Argentina expects $4 billion in financing from multilateral lenders in 2017.

The IADB also said it would contribute up to $600 million to a new fund to finance or guarantee infrastructure projects in Argentina.

Caputo said the fund, which will include an additional $300 million from the World Bank, will help Argentina boost infrastructure investment by 50 percent next year to reach 3.5 percent of gross domestic product.

The government expects that increase to be supported by 100 billion pesos ($5.84 billion) in investment through public-private partnerships, worth about 1 percent of GDP, after a new law allowing such arrangements passed last year. ($1 = 17.1300 Argentine pesos) (Reporting by Luc Cohen; Editing by Alistair Bell)

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