Climate action in Latin America: EIB and FONPLATA sign agreement to invest USD 120m in urban and rural development projects
- The EU bank is providing USD 60m to finance public infrastructure in Argentina, Bolivia, Brazil, Paraguay and Uruguay
- All of the projects financed by the EIB-FONPLATA partnership will focus on climate change adaptation and mitigation
The European Investment Bank (EIB) and the Fondo Financiero para el Desarrollo de la Cuenca del Plata (FONPLATA – Plata Basin Financial Development Fund) today took a major step forward in providing resources to finance urban and rural development projects that will also help protect the environment and promote climate action in Argentina, Bolivia, Brazil, Paraguay and Uruguay. The EU bank has provided FONPLATA with a USD 60m loan to which the Latin American development institution will add a further USD 60m, making a total of USD 120m available to finance sustainable projects in the region.
EIB Director for Operations in Latin America María Shaw-Barragán and FONPLATA Executive President Juan E. Notaro signed the agreement today in Luxembourg. The EIB is supporting this project via its Climate Action and Environment Facility (CAEF).
The agreement signed by the EIB and FONPLATA will make it possible to finance the investments of local, regional and national authorities in the Río de la Plata Basin to promote social, economic and environmental projects with the common goal of strengthening infrastructure facilitating climate change adaptation in both urban and rural areas. This initiative will also help create more than 5 500 jobs during the implementation phase of the various projects until 2022.
In concrete terms, the EIB-FONPLATA partnership plans to take action in several focus areas. In sustainable urban development, it will finance the construction and renovation of public buildings, parks, and street lighting and drainage systems, for example with the implementation of the urban redevelopment plan of Corumbá, Brazil. In Bolivia, the project includes providing financing for bridge construction in rural parts of the Cochabamba department, thereby helping to combat poverty.
This USD 120m financing agreement will also enable the provision of new infrastructure in regions affected by major droughts, floods or climate change-related phenomena such as El Niño. With this goal in mind, the programme will finance the repair of social infrastructure destroyed by natural disasters, for example in northern Argentina.
On signing the agreement, María Shaw-Barragán highlighted its importance “for providing funds to benefit the people most vulnerable to natural disasters caused by climate change. With this project, the EIB is acting in line with its key priorities in the region: combating poverty, and promoting social inclusion and economic growth via sustainable projects.”
“With this agreement, FONPLATA is partnering with an institution with which we share common interests such as promoting sustainable development and combating poverty. The agreement signed today will have a very positive impact on the people of our member countries, especially those most vulnerable to climate change, who tend to live in rural areas, as well as more isolated and border regions,” said Juan E. Notaro.
The EIB is the world's largest financer of environmental investments, and promoting sustainable and secure energy sources is one of its key objectives. It applies very strict criteria in appraising the projects it finances to ensure that its energy sector loans reflect EU priorities in the area. We support the development and expansion of renewable energy projects in and outside the EU. Last year, our loans financed the construction of 76 557 km of power lines making it possible to generate 10 924 MW of energy, 99.6% of which was from renewable sources.