February 11, 2010 / 2:55 AM / 10 years ago

UPDATE 1-World Bank restores development aid to Honduras

(Adds quote, background on aid in Honduras)

TEGUCIGALPA, Feb 10 (Reuters) - The World Bank said on Wednesday it is restoring development aid to Honduras that it had frozen after a coup toppled President Manuel Zelaya.

World Bank Managing Director Juan Jose Daboub told a news conference in the Honduran capital that the bank would restore a planned loan of $270 million and add $120 million in new credit, for a total of $390 million, following the inauguration of a new elected president in the country.

Aid agencies and donor nations agreed to an international aid freeze that amounted to $450 million after the June 28 coup that ousted Zelaya. Last month, the United States promised to restart aid, as other nations have begun to normalize relations with the impoverished Central American country.

“For the World Bank, it is important to say that we are here to continue supporting the Honduran people ... especially the most vulnerable in society,” said Daboub.

Honduras received about $1 billion a year in foreign loans, humanitarian aid and subsidized Venezuelan fuel before the coup, representing around 20 percent of its national budget. (Reporting by Gustavo Palencia; writing by Patrick Rucker)

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