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CAF approves US$160 million loan for water and sanitation projects in Paraguay

  • CAF approves US$160 million loan for water and sanitation projects in Paraguay

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The Board of Directors of CAF, Development Bank of Latin America, approved credit for USD 160 million for the Republic of Paraguay to finance the Project for the Construction of the Sanitary Sewerage System, Wastewater Treatment Plant and Improvement of the Drinking Water System of the Mariano Roque Alonso Basin, an initiative that will benefit some 250,000 inhabitants of the cities of Mariano Roque Alonso, Luque and Asuncion.

This operation is part of CAF's strategy in the Water Sector. Its strategic sectoral objective refers to safe access to drinking water and sanitation for populations, as well as the reduction of water pollution and the preservation of ecosystems, in line with the region's main social and environmental challenges.

"With the works that are part of the investment programme of this loan, we accompany the National Government in its national strategic plan that includes the expansion of the coverage of sewerage networks, as well as the increase in wastewater treatment in the cities of Mariano Roque Alonso, Luque and the north of Asunción, in addition to interventions to optimise the drinking water supply system", said Sergio Díaz-Granados, Executive President of the institution. He added that "this project will improve the health conditions of the inhabitants and preserve the quality of the water resources of the Paraguay River".

The institution will finance the construction of approximately 73 km of sewerage networks and collectors, a wastewater treatment plant, the implementation of approximately 9.4 km of impulsion lines, and the execution of approximately 6 pumping stations, among others.

This project meets environmental criteria that categorise it as an operation with environmental and climate co-benefits, in line with CAF's ambition to become the Green Bank of Latin America and the Caribbean. In addition, the works are directly related to the sustainable development goals SDG 6 water and sanitation, SDG 8 decent work and economic growth, SDG 11 sustainable cities and communities and SDG 13 for climate action.

This operation is the second loan granted by CAF to the water sector in Paraguay. In December 2019, CAF approved the first operation for USD 52 million to finance sanitation works in four intermediate cities in the country (Santa Rosa del Aguaray, San Ignacio, Santa Rita and Carapeguá). Between 1997 and 2021, CAF approved loans for USD 5,523 million in favour of the country for initiatives that promote sustainable development, fiscal stability and infrastructure modernisation.

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