MICROCAPITAL BRIEF: CAF Development Bank of Latin America, Codespa Foundation Study Possible Trust Fund for Rural Producers in Ecuador

CAF Development Bank of Latin America, a Venezuela-based multilateral financial institution that was formerly Corporacion Andino de Fomento, is partnering with Codespa Foundation, a Spanish non-governmental organization that works with poor communities in developing countries, to undertake a feasibility study for the creation of a trust fund that would provide microfinance services to small-scale producers in rural Ecuador. While CAF’s previous work in the country has involved supporting small-scale farmers, the fund would be intended to strengthen production chains in a variety of industries according to Hermann Krützfeld, CAF’s country director in Ecuador. The study would assess the role local financial institutions can play in further integrating these production chains.

Although the size of CAF’s financial contribution was not disclosed, its involvement is to be directed towards evaluating the project’s potential through market analysis and designing a financial structure for the fund. If established, this trusteeship will be managed by a network of private companies, multilateral agencies and microfinance institutions.

As of September 2012, CAF reported total assets of USD 24 billion, a loan portfolio of USD 15.5 billion, return on assets of 0.8 percent and return on equity of 2.8 percent. As of 2013, its shareholder structure is comprised of 18 countries from Latin America, the Caribbean and Europe as well as 14 private banks from the Andean region. As of 2011, Codespa reached 150,000 people through 151 projects in Africa, Asia, Europe and Latin America. As of the same year Codespa reported total assets of EUR 23 million (USD 30 million).

By Lena Phillips, Research Associate

About CAF Development Bank of Latin America

Established in 1970 and headquartered in Caracas, Venezuela, CAF is a multilateral financial institution that provides loans for purposes such as microfinance, infrastructure and health throughout Latin America and the Caribbean. Formerly known as Corporacion Andino de Fomento, it also provides financial advisory services and technical assistance. As of September 2012, CAF reported total assets of USD 24 billion, a loan portfolio of USD 15.5 billion, return on assets of 0.8 percent and return on equity of 2.8 percent. As of 2013, its shareholder structure is comprised of 18 countries from Latin America, the Caribbean and Europe as well as 14 private banks from the Andean region.

About Codespa Foundation

Established in 1985, the Codespa Foundation is a non-governmental organization that works in developing countries with the intent of bringing poor populations out of poverty. As of 2011, Codespa reached 150,000 people through 151 projects in Africa, Asia, Europe and Latin America. As of the same year, Codespa reported total assets of EUR 23 million (USD 30 million).

Sources and Additional Resources:

CAF Noticias:”Nuevo Aporte Para La Potenciaci?n De Cadenas Productivas En Ecuador,” http://www.caf.com/view/index.asp?ms=19&pageMs=62270&new_id=84964

4-traders.com Article, “CAF- Corporaci?n Andina de Fomento: CAF project aimed at supporting production supply chains in Ecuador,” http://www.4-traders.com/news/CAF-Corporaci%F3n-Andina-de-Fomento-CAF-project-aimed-at-supporting-production-supply-chains-in-Ec–15980437/

MicroCapital.org Article, 25 June 2012, “MICROCAPITAL BRIEF: Inter-American Development Bank (IDB), Multilateral Investment Fund (MIF), CAF Development Bank of Latin America Issue Call for Proposals for Technologies for Financial Inclusion Program,” https://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-multilateral-investment-fund-mif-caf-development-bank-of-latin-america-issue-call-for-proposals-for-technologies-for-financial-inclusion-p/

MicroCapital.org Article, 10 May 2011, “MICROCAPITAL BRIEF: Inter-American Development Bank (IDB), Multilateral Investment Fund (MIF), Andean Development Corporation (CAF), Global System for Mobile Communications Association (GSMA) Call for Proposals for ‘Technologies for Financial Inclusion Program,’” https://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-multilateral-investment-fund-mif-andean-development-corporation-caf-global-system-for-mobile-communications-association-gsma-call-for/

MicroCapital Universe Profile: CAF Development Bank of Latin America, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Corporaci%C3%B3n+Andina+de+Fomento+%28CAF%29

MicroCapital Universe Profile: Codespa Foundation, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Codespa+Foundation

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