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Cablegate: Application for Opic Finance: Bac San Jose

VZCZCXYZ0000
PP RUEHWEB

DE RUEHSJ #0653 2220104
ZNR UUUUU ZZH
P 090104Z AUG 08
FM AMEMBASSY SAN JOSE
TO RUEHC/SECSTATE WASHDC PRIORITY 9992
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY

UNCLAS SAN JOSE 000653

SIPDIS

DEPT FOR EEB/IFD/ODF, EEB/IFD/OIA; PLEASE PASS TO
OPIC/VP/SF:KCHRISTENSEN; PLEASE PASS TO COMMERCE/FCS

E.O. 12958: N/A
TAGS: CS ECON EFIN PGOV PREL
SUBJECT: APPLICATION FOR OPIC FINANCE: BAC SAN JOSE

REF: SECSTATE 80569

1. SUMMARY: Embassy San Jose supports OPIC's proposal for a
$60 million loan to BAC San Jose, S.A. The Econ and FCS
Sections have reviewed the proposal and concluded that there
were no reasons that the loan should not proceed (Reftel).
END SUMMARY.

---------------------
RECENT COUNTRY EVENTS
---------------------

2. Though the fiscal and consumer impact of rising fuel and
food prices greatly concern the GOCR and the general
populace, the Costa Rican economy continues to grow and is
projected to expand by 4 percent in 2008. The GOCR
forecasted a small deficit for 2008 and is still on track to
meet that target due to prudent budgeting by the Ministry of
Finance.

------------------------
STANDING OF BAC SAN JOSE
------------------------

3. Embassy review of the subject company -- BAC San Jose,
its foreign sponsor (Carlos Pellas), and key shareholder
investors -- did not produce any information linking the
company and / or principals to terrorism, money laundering,
corruption, or violations of law.

-------
COMMENT
-------

4. Embassy San Jose believes that a program like this one,
designed to provide lending to medium-sized businesses and
low-middle income mortgage borrowers, is well-suited to local
market demand. In addition, the proposal may be of great
assistance to these market segments in the likely scenario
that the Costa Rican lending environment tightens over the
coming months due to inflation rising higher than expected
over the past six months. We remind OPIC that USAID does not
have an in-country economic development assistance team in
Costa Rica. (The lone in-country USAID mission is the Office
of Foreign Disaster Assistance). Hence, there is no USAID
development staff to review the OPIC proposal.
CIANCHETTE

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