World Bank Drops Investment Loans in Peru

The World Bank has canceled out seven investment loans included in the country partnership strategy for Peru. These include various projects on infrastructure, housing, education, tourism, governance, disaster management and business development.

In a Devex interview, bank official Miguel Ostos said that the partnership between the World Bank and the Peruvian government is moving away from investment loans. Their focus is now on providing knowledge and advisory services, development policy loans, and deferred drawdown options or funds that provide flexibility in access.

The bank has allotted some US$3 billion for Peru mostly for development policy loans – two of which are in the pipeline of bank operations. Mostos said that these initiatives are scheduled to go to the board for approval in February and March of this year.

Another loan with a deferred drawdown option to support industries hit by the financial crisis is under preparation.

The government of Peru has generated sufficient revenues to fund the projects previously identified as requiring bank financing.

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    Mara Yasmin Baviera

    Mara Baviera is a young researcher working in the Early Intelligence Team in Devex. Before joining the organization, she worked as a research assistant in various projects on human security, decision-making and economic development in the Philippines and trade negotiations. Her areas of interest include political economy, trade and development.