IIC Signs US$8.5 Million Loan Agreement with Sindicato Energético, a Hydroelectric Power Generator

10/30/2002

LIMA, PERU - The Inter-American Investment Corporation (IIC) signed on October 31, 2002 an $8.5 million loan agreement with Sindicato Energético S.A. (SINERSA), a hydroelectric power generator in Peru. The signing ceremony took place in the Club Empresarial in Lima. The agreement was signed by the General Manager of the IIC, Mr. Jacques Rogozinski, and the President of the Board of Directors of SINERSA, Mr. Jorge Gruenberg.

The project consists of expanding SINERSA by building and operating the 15.4 MW Poechos hydroelectric plant. The energy to be produced by Poechos will be sold to Electronoroeste S.A. (ENOSA), which holds the concession for distributing power in northwestern Peru. The project has a total cost of US$16.3 million for which the IIC has arranged a US$8.5 million facility in the form of an A and B loan structure. The IIC will provide US$6 million through the A loan, and Corporación Interamericana para el Financiamiento de la Infraestructura (CIFI) will provide the US$2.5 million B loan.

Currently, almost 50% of the inhabitants of the ENOSA area of influence do not have electric service. The increased generation from Poechos will help make it possible to increase electric coverage to the area and thus improve the quality of life of the inhabitants. In northwestern Peru, there are plans to take advantage of the future Poechos hydroelectric plant to build three small power distribution systems that will be fed directly by Poechos. It is expected that these small systems will benefit more than 20,000 people in the area.

The Inter-American Investment Corporation is a multilateral financial institution that is part of the Inter-American Development Bank Group. It provides financing (in the form of equity investments, loans, guarantees, and other instruments) and advisory services to private enterprises in Latin America and the Caribbean. The IIC's mission is to promote the economic development of its regional borrowing member countries by stimulating the establishment, expansion, and modernization of private enterprises, particularly those that are small and medium in size.

Contact: Steven Reed

Telephone: (202) 623-3981

Email: stevenr@iadb.org