World Bank approves US$752mn loan for growth, job creation

- Wednesday, January 19, 2011

World Bank approves US$752mn loan for growth, job creation

The World Bank approved a US$752mn loan to support the implementation of public policies in Mexico that look to foster growth and job creation, with the results expected to lead to more internet and broadband users, according to a press release from the organization.

According to the World Bank, the loan will support government efforts to enact legal, regulatory and administrative changes to improve input market performance and infrastructure services, update procedures required to open businesses, and facilitate access to new markets.

In addition, the loan program proposes four pillars: strengthening the competitive environment in critical sectors like telecoms and the public acquisitions system, simplifying regulations to reduce business transaction costs, improving the regulatory framework to facilitate access to basic financial services, and promoting public-private partnerships to expand the quality and coverage of infrastructure.

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One of the expected results is increasing the number of financial transactions carried out through mobile phones.

The World Bank highlighted the current government's public policy efforts focused on strengthening the Mexican economy via improvement in competitiveness. According to the multilateral bank, the government has carried out a various financial, telecoms and infrastructure sector activities to bolster its public policy efforts.

Mexican finance ministry SHCP is in charge of the loan and has named federal savings bank Bansefi as the financial agent. The project - expected to finish in January 2012 - will be accompanied by an array of consultancy services.

The loan has a variable interest rate and matures in 18 years.