CAF and EIB to co-finance climate action projects to boost employment and competitiveness in Latin America
The COVID-19 pandemic has highlighted the need for international cooperation to mitigate its adverse effects and to promote the economic and social well-being and recovery of countries when they need it most, while maintaining climate action as a fundamental criterion in interventions. CAF - the Latin American development bank - and the European Investment Bank (EIB) are capitalizing on their complementary strengths and placing them at the service of sustainable development and the integration of Latin America and the Caribbean in order to mitigate the infrastructure investment gap.
CAF and the EIB signed a Co-financing Partnership Framework for European support to Latin America and the Caribbean to mitigate the damage of the COVID-19 pandemic and promote post-pandemic economic recovery. The agreement proposes a USD 500 million co-financing framework to benefit sectors such as transport, energy, water and sanitation, urban development, health, education and financial intermediation for SMEs, among other strategic sectors for both institutions.
"Investments in integration infrastructure in the region are essential to boost economic and social recovery because of their positive effect on job creation, economic growth and increased productivity. We are a key partner for the development of our shareholder countries and we are seeking to complement ourselves with strategic allies such as the EIB on this opportunity to attract resources that will enable us to carry out works that promote competitiveness," said Luis Carranza Ugarte, Executive President of CAF.
EIB Vice-President Ricardo Mourinho Félix, responsible for Latin America, said: "The signing of this Partnership Framework underlines the European Investment Bank's commitment to Latin America and the Caribbean at this difficult time. The CAF is one of our key partners and through this joint effort we will support the countries and companies of the region in dealing with the economic and social impact of the COVID-19. This agreement will allow us to identify and promote investment opportunities in sectors of common interest that will foster sustainable and inclusive economic recovery and contribute to the fight against climate change.
CAF has identified over 400 integration and digital infrastructure projects in 11 sub-sectors, all of which are aligned with the 17 Sustainable Development Goals and the Paris Agreement in the fight against climate change. These initiatives have been prioritised for the quality of their structuring, rapid implementation and the specialised accompaniment of their experts, which can boost employment generation and economic growth in Latin America and the Caribbean.
The EIB provides financial support for projects in Latin America by facilitating long-term investment on favourable terms and providing the technical support needed to ensure that these projects achieve positive results in the social, economic and environmental fields. Since the EIB began operations in Latin America in 1993, it has provided financing totalling EUR 8.4 billion, supporting 117 projects in 14 countries in the region.