[China Co-Financing Fund] IDB administers $20 million loan from CHC to Government of Uruguay for Innovation Program for Productive Development

Project narrative

On February 13, 2015, the Inter-American Development Bank (IDB) signed a loan contract with the Government of Uruguay to finance the Innovation Program for Productive Development, through which the IDB would provide $20 million from its ordinary capital (Loan 3315/OC-UR), and the People's Bank of China would provide $20 million (Loan 3316/CH-UR) via the China Co-Financing Fund for Latin America and the Caribbean (CHC). The IDB lists the anticipated total cost of the project as $70 million, and notes that the remaining $30 million was to be financed by the Government of Uruguay. The purpose of the Innovation Program for Productive Development is to increase the productivity and competitiveness of firms in Uruguay. The program was to be implemented by the National Agency for Research and Innovation (Agencia Nacional de Investigación e Innovación, ANII). Objectives of the Innovation Program for Productive Development included increasing firm innovation capacities; strengthening human capital; boosting the generation of scientific and technological knowledge; and enhancing the ANII’s capacity to design, execute, and evaluate public policies for science, technology, and innovation. Loan disbursements began between January 2015 and June 2015. As of October 31, 2017, 19,166,091 had been disbursed from the loan from the China Co-Financing Fund. As of October 26, 2020, 99.92% of the total $40 million had been disbursed. In the original loan proposal, published October 21, 2014, the loan is listed as having a 24 year amortization period and a 6.5 year grace period, including a 6-year disbursement period. The borrower was expected to pay a LIBOR-based interest rate plus the applicable lending spread for the Bank's ordinary capital loans. The IDB lending spread in Semester 1 of 2015 was 0.85% with a 0.25% credit fee.