Uruguay
The Uruguayan government promotes a financing scheme to sustain rice production
The agreement with producers and mills provides for voluntary loans of up to 10 years to support the next harvest. According to Caras y Caretas, the tool could mobilize about US$ 50 million and reach some 400 producers.
Uruguay’s Executive Branch agreed with the Rice Growers Association and the Rice Millers Association to create a financial tool aimed at sustaining the productive continuity of the rice chain and facilitating resources for the next harvest, Caras y Caretas reported.
According to that outlet, the scheme contemplates individual loans, on a voluntary basis and with terms of up to 10 years. The official estimate is that it could mobilize financing of around US$ 50 million, reaching approximately 400 producers and with a cap of up to US$ 500 per hectare.
Still according to Caras y Caretas, the instrument will have three complementary backstops. The first will be a guarantee within the National Guarantee System, with initial coverage of 50%. The second corresponds to a commitment from the Rice Millers Association, which will cover 40% during the first year and 30% from the second. The third will be a growing sectoral guarantee fund, which will begin with US$ 1 million from the Fondo Arrocero IV and will be fed by part of the sector’s export flow.
The participation of those mechanisms will be adjusted progressively, depending on the instrument’s evolution. In addition, the participation of Grupo BROU and other interested banking institutions is being coordinated to channel financing through the financial system.
After the understanding, the technical teams of the Executive Branch, the ACA and the GMA continue working on implementation, including the applicable regulations, the definition of roles and the structuring of agreements and trusts, with the goal of putting the tool into operation as soon as possible.
Sources
About this note. Written by El Notero with the assistance of artificial intelligence, based on what was published by the cited outlet. El Notero did not conduct its own reporting on this fact.
