To improve water quality and increase access to sanitation services in Brazil, IFC is signing a strategic partnership with the Brazilian sanitation company Sociedade de Abastecimento de Água e Saneamento S.A. (Sanasa). The partnership includes a BRL 260 million (approximately $52 million) blue loan and strategic advisory services to support the company's 2023-2025 investment plan.
Sanasa is a water utility company operating in Campinas, a city with 1.3 million residents in the state of São Paulo. IFC's blue loan will assist Sanasa in expanding its water supply systems and sewage treatment capacity in Campinas. This will help the company reach its objective of 100% service coverage by 2026 as well as improve operational resilience, enhance service quality, and increase efficiency.
The blue loan is provided under IFC's Utilities for Climate (U4C) initiative, which combines IFC's advisory and investment services to deliver climate-friendly solutions to water utilities. As part of the pre-investment services, IFC is supporting Sanasa's seek for a blue loan certification and will provide a diagnostic of the company's Information Technology (IT) system to improve operational resiliency and reduce to water loss.
To improve water quality and increase access to sanitation services in Brazil, IFC is signing a strategic partnership with the Brazilian sanitation company Sociedade de Abastecimento de Água e Saneamento S.A. (Sanasa)
Improving access to water and sanitation is critical to achieving Brazil's inclusion goals and promoting sustainable development. In 2020, Brazil passed the Water Law (Law 14,026) which aimed to increase access to clean water to 99% of the population and to sewerage to 90% by 2033.
"Water supply and sanitation are strategic priorities for IFC in Brazil and this investment will help Sanasa modernize and improve its infrastructure," said Carlos Leiria Pinto, IFC Brazil Country Manager. "Our engagement with Sanasa will help Brazil meet its goals of improving water and sanitation systems, as well as improving public health and quality of life for the country's population," he adds.
"This partnership we are celebrating with IFC goes beyond this investment. IFC's loan will support Sanasa's boldest works program: the Campinas 2030. The program is providing the sanitation infrastructure that will support the socioeconomic development of the municipality and includes the construction of 20 water reservoirs and new investments in sewage services. We look forward to drawing on IFC's expertise to take Sanasa to a new level of operational efficiency," says Manuelito Magalhães, CEO of Sanasa.
This blue loan is aligned with IFC's priorities in Brazil to promote actions to foster climate change mitigation and adaptation. Sanasa's improvement plan includes greenhouse gas (GHG) savings largely by decommissioning a less efficient wastewater treatment plant, rerouting sewage to less GHG-intensive plants, and replacing water tanker trucks with a piped network. With enhanced operations which includes extra storage capacity and supply flexibility, the project will also help reclaim water and reduce the demand-supply gap in the Piracicaba, Capivari, and Jundiaí River (PCJ) basin, improving climate adaptation in the region.
This long-term local currency loan is IFC's third financing under the U4C initiative in Brazil, following IFC's debt investments in Companhia Riograndense de Saneamento (Corsan) in 2021 and Companhia de Saneamento Básico do Estado de São Paulo (Sabesp) in 2022.
