Developmental Investment Activities
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Honduras
Manufacturas del Trópico, S.A. is a Honduran corporation located near San Pedro Sula, Honduras' industrial hub. Del Trópico manufactures high quality outdoor furniture that is currently distributed in the United States by a U.S. firm that produces and distributes furniture for the high-end market segment.
The IIC approved a $3 million loan to Manufacturas del Trópico (a $1.5 million senior loan and a $1.5 million subordinated loan) for expanding and upgrading del Trópico's facilities. The project entails the construction of an additional 8,050 square meters of industrial bays, the purchase and installation of production equipment, the upgrading of the plant's environmental and labor conditions, and other improvements in the areas of management systems, information systems, and working capital.
The IIC loan will foster the transfer of technology to Manufacturas del Trópico thanks to its links to its U.S. distributor. The loan will also enable the company to expand its own market and sell furniture to Europe and Latin America. The project will also help generate foreign currency and create jobs, since del Trópico, which currently employs 426 Honduran workers, will add another 600 jobs in its expanded facilities. The implementation of the project will have a significant developmental impact in Honduras, which is striving to rebuild its economy in the wake of Hurricane Mitch.
The IIC's strategy for Honduras after Hurricane Mitch calls for the direct financing of projects in sectors that create large numbers of employment opportunities and generate foreign exchange. With a $7.5 million loan to Zona Industrial de Exportación Buena Vista, S.A. (ZIP Buena Vista), the IIC will help finance the $16.2 million expansion of an industrial park near San Pedro Sula, the industrial center of Honduras. A total of 42,896 square meters of industrial space will be added as part of the expansion, as will a parking lot for containers, an additional well, a water storage tank, and two solid waste incinerators. ZIP Buena Vista will also expand the existing sewage water treatment plant and purchase waste collection equipment. The expanded facilities will provide employment to an additional 5,400 workers.
The ZIP Buena Vista project will generate directly about $20 million in hard currency earnings for Honduras during the first ten years of operation. Indirectly, the project will generate approximately $22.1 million per year in value added from the companies installed in the new facilities.
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