The Inter-American Development Bank (IDB) has approved a Conditional Credit Line for Investment Projects (CCLIP) of US$135 million in two tranches to boost socioeconomic development by promoting clean and sustainable services within the framework of a just energy transition.
The credit line was approved by the IDB’s Executive Board, with the first tranche comprising of an individual operation of US$45 million in the form of a Global Multiple Works Operation and a non-reimbursable financing of US$1.5 million from the Low Emission Energy Fund for People and the Planet.
The first individual operation will finance a bioeconomic empowerment program in indigenous communities through access to water, energy, and telecommunications. Its objective is to promote the socioeconomic development of villages in rural areas.
It is expected to directly benefit 1,200 households, 25 health centers, 30 schools, and 50 commercial activities in the Amazon region, particularly local farmers, small business owners, indigenous peoples, women, and afro-descendants. It will also benefit 400 women with jobs in bioeconomic activities. The Ministry of Natural Resources and the local electric company EBS will benefit from institutional strengthening.
The lack of reliable and sustainable infrastructure in the electricity, water, and telecommunications sectors in rural areas is reflected in coverage rates. The national electricity access rate is 98.2%. However, in rural areas, especially in villages, it is below 90%, leaving about 20,000 households without access or dependent on small diesel generators.
Similarly, water supply is limited—less than 60% of the rural population has access—and telecommunications infrastructure is deficient or non-existent in the interior, where only 27% have internet access.
To address these challenges, the program will finance investments in electricity, water, and telecommunications infrastructure and services, as well as their productive and sustainable use (“bioeconomy”) in rural Amazonian areas.
In this regard, it plans to finance the supply, installation, and commissioning of disaster-resilient solar mini-grids, including the improvement of the existing distribution network to provide permanent electricity in these areas.
It will also support the installation of water collection, treatment, and distribution systems to provide clean and reliable water to villages, and finance the improvement and development of telecommunications distribution and access infrastructure (telephony, internet, and broadcasting).
Additionally, the program will support the formulation and execution of projects for the productive and sustainable use of electricity, water, and telecommunications services, with an emphasis on the bioeconomy, and strengthen the institutional capacity of the Ministry of Natural Resources and EBS to plan, design, and supervise rural electrification and water supply projects.
The first individual loan of US$45 million under the CCLIP has a repayment term of 23.5 years, a grace period of seven years, and an interest rate based on SOFR.
