The IDB approved 300 million dollars for Colombia: what will they be used for

The IDB approved 300 million dollars for Colombia: what will they be used for

The BInter-American Development Bank (IDB) announced the approval of a loan of 300 million dollars to support the strengthening of Colombia in the management and financing of climate action, the promotion of economic opportunities based on the use of natural capital and the circular economy, and the promotion of the energy transition.

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The program focuses on updating and implementing regulatory and policy measures that will contribute to the reduction of greenhouse gas emissions in various sectors of the economy and the creation of nearly 4,000 new green jobs.

This operation is the second in a series designed under the Policy Reform Support Loans modality. The first program received financing of 800 million dollars from the IDB and was successfully executed with the approval of 44 measures to strengthen the Government’s capacity to incorporate climate action and sustainable economic recovery into national policy frameworks, highlighted the entity.

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The programmatic series also featured co-financing by partners such as the French Development Agency, the German Development Bank, the Korean Export-Import Bank, the Swedish International Development Cooperation Agency, the Development Bank of Latin America, the Central American Bank for Economic Integration and the UK Government UKSIP Programme.

It should be noted that within the framework of the program, Colombia presented its Long Term Climate Strategy during COP26; approved the Climate Action Law (Law 2169 of 2021), and issued the first sovereign green bonds in the domestic market (green TES) under the leadership of the Ministry of Finance and Environment.

The country also updated its climate finance strategy and sectoral and territorial climate change plans in the context of the program. For example, it promotes regulatory changes in monitoring and reporting systems, carbon markets, and knowledge transfer on climate-smart agriculture and good practices for resilience in the agricultural sector.

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With this transfer of knowledge, a potential of two million agricultural producers and 30% of rural women could benefit.

As for the energy and transport sectors, The measures aim to reduce air pollution caused by internal combustion vehicles and the development of a diversified, cleaner and more resilient energy matrix with a potential of 20 GW of generation through FNCER.

With the first loan from the IDB, Colombia marked a milestone by increasing its objectives of reduction of greenhouse gas emissions from 20% to 51% in 2030, within the framework of its commitments for the Paris Agreement, and accompanied this measure with other policies, such as the approval of the National Deforestation Control Policy and the issuance of the Sustainable Tourism Laws (Law 2068 of 2020) and Transformation Energy (Law 2099 of 2021).

(See: The 1,000 largest companies in the country represent 77% of GDP).

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