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Loans are agreements between CAF and its clients, whereby clients agree to return to CAF, within a specified period, the sum of money borrowed for a specific purpose, plus interest, fees, and other expenses agreed between the parties.
Loans represent CAF’s main financial tool, and can be short term (1 year), medium term (1-5 years), and long term (over five years). There are also different types of loans: commercial loans (pre-shipment and post-shipment) and working capital loans, for projects and limited guaranty loans.
CAF may finance sovereign risk and non-sovereign risk operations. Loans can be granted in all stages of project implementation; however, under certain circumstances and within the context of a comprehensive credit, CAF may provide loans for the promotion of exports and working capital to companies or financial institutions.
The range of projects that CAF may fund varies, and includes plans related to infrastructure for roads, transportation, telecommunications, power generation and transmission, water and sanitation, as well as those that encourage border development and physical integration between shareholder countries.
In the area of industry, CAF invests in projects to expand and modernize the production capacity and business integration of its shareholder countries in regional and global markets.
Among the advantages of this program are:
- Access to better financing terms based on the support of a multilateral institution that meets a client’s need in terms of duration (simultaneously, short, medium and long term).
- Flexibility and responsiveness that characterizes CAF.
Eligible transactions for funding by CAF are those that are submitted by the governments of shareholder countries, as well as private or mixed capital sector projects from a wide range of economic sectors.
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