The Inter-American Development Bank (IDB) approved, in Washington, a loan of 500 million dollars for Argentina to strengthen its capacity to plan and finance climate actions, develop a favorable framework for sustainable finance that ensures the necessary investments for a transition sustainable and inclusive private sector, and promote the circular economy and the decarbonisation of economic activity.
The Ministry of Economy specified that the loan will be disbursed in a single payment at the beginning of December and, thus, will reinforce the reserves of the Central Bank.
The loan has a 20-year repayment term, with a 5.5-year grace period and an interest rate based on SOFR (Secured Overnight Funding Rate, which banks use to set the price of dollar-denominated derivatives and loans), the multilateral organization said in a statement.
This is the first of two technically linked back-to-back trades, but fiindependently financed, under the programmatic loan modality in support of policy reforms, which are intended to invigorate the sustainable and resilient growth of the country.
These policy reforms are key to reducing greenhouse gas emissions from the sectors that generate 80% of them: energy, transportation, agriculture, livestock, and land use change.
Thus, it seeks to support the decarbonization of the economy and contribute to the goal established by the Government for the reduction of annual CO2 emissions, from 366 to 349 million metric tons by 2030.
As a result of the program, there will be climate budget markers in the national budget, including an item for the conservation of more than four million hectares of native and protected forests.
Likewise, it will contribute to the generation and registration, within a period of two years, of 32 projects in the new National Registry of Climate Change Mitigation Projects.
As part of the Green Productive Development Plan, it is expected to increase the number of supported renewable energy and energy efficiency projects, from the current 17 to 160 by 2024, and substantially increase the participation of renewable energies in the national energy matrix.
In the financial aspect, it is expected to promote the issuance of green bonds, increase the number of banks that use environmental and social risk analysis systems to decide the approval of their operations, and increase the participation of mutual funds that finance activities with Significant impact on some social, environmental, climate or governance aspect.
In the area of solid waste management, the operation will give a strong boost to the recycling of urban waste, taking it from the current 0.9 to 1.3 million tons per day in 2024, and will substantially increase the percentage of the population with access to it. differentiated collection system.
