Home South AmericaUruguay United Nations Fund designated a Uruguayan organization to finance projects: what is it about?

United Nations Fund designated a Uruguayan organization to finance projects: what is it about?

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The board of directors Green Climate Fund (GCF)the global fund backed by United Nations that aims to carry out projects in favor of climate change, appointed the National Cooperation for Development (CND) as a national accredited entity. This means that From now on, the state organization is a means to manage financing for climate programs and projects in which Uruguay submitted for approval to the world’s largest climate fund, supported by developed countries and applied to developing countries.

Up to now, the accredited entity services for projects in Uruguay are provided by multilateral financial organizations (such as CAF-Development Bank of Latin America). These entities receive the proposals from the Ministry of the Environment, a ministry that is the designated national authority to approve projects financed by the GCF. From now on, this ministry will have the option of discussing these issues with the CND.

This change was requested in 2019 and, after a process of evaluation of the GCF directivethis year the CND was designated as the accredited entity.

In this sense, The general manager of the National Development Corporation (CND), Sergio Fernández, highlighted that climate change is having more and more repercussions on the traditional economy, such as access to markets and trade restrictions. And this international fund, which will now channel its investments through the CND, It is an opportunity to place Uruguay at the regional vanguard in this “transition economy” that the planet is experiencing. “The economic goals linked to caring for the environment are not up in the air, it already has a concrete impact on the economy of a country,” he said.

From the point of view of the CND, which is in charge of the contractual and financial structuring of projects, a Significant impact on financial markets, access to credit and financing costs by pursuing care for the environment. Fernandez stressed that Uruguay has the opportunity to capitalize on these trends if you commit to serious and consistent work on initiatives related to hydrogen and green fuels, for example.

Besides, Uruguay has “globally recognized achievements”, such as the change in the energy matrix and the green bond recently issued by the Ministry of Economy, which has linked the private sector with climate indicators. Fernández emphasized that this type of bond not only reduces financial costs, but also provides incentives to meet climate goals.

The general manager of the CND also highlighted the importance of the transition towards renewable energy sources and the role of the agro-industrial sector in the absorption of carbon dioxide. In addition, He pointed out the need for the country to adapt to the challenges posed by climate change.

“Uruguay has the opportunity to take advantage of this fund as an important source of financing for the transition towards a more sustainable economy,” concluded Fernández.

The opportunities identified by the organization

Among its tasks, the CND is an entity in charge of identifying areas of opportunity in public infrastructure and related services, prepare and promote investment projectsprovide consulting services, analyze and structure projects for the public or private sector, related to their field of competence.

The CND acts by supporting and collaborating in the legal and financial structuring, as well as in the supervision and execution of various projects that public sector organizations —from ministries to ANEP and Udelar— carry out in their areas of competence, substantially in infrastructure areas.

In this sense, according to Fernández, from 2000 to the present, the CND has supported infrastructure projects in the road, railway, port, energy, education, penitentiary, urban, departmental and, in recent years, environmental, climate change and water and sanitation areas. On this last point Fernandez expressed that the CND is collaborating in the Arazatí project, which provides for the construction of infrastructure to make water drinkable with an initial investment of US$ 200 million, and in consultancy with OSE.

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