The Inter-American Development Bank (IDB) approved loans for Argentina for a total amount of USD 400 million, aimed at promoting private and public investment in the country and at benefitting SMEs that invest in Renewable Energy and Energy Efficiency projects.

The first loan, for USD 300 million, will foster economic growth through the modernization of institutional frameworks for taxation and policy-making. The IDB financing is for a 20-year term, with a 5.5-year grace period and a LIBOR-based interest rate.

This is the first of two programmatic policy-based loans (PBP) to be executed by the Ministry of Treasury to address Argentina’s challenges of boosting growth through private and public investment, supporting the government in its agenda of reforms to reduce constraints on private investment, and strengthening public investment processes. The loan is specifically geared toward laying the legal groundwork for fiscal, investment, and entrepreneurship reforms at the national level, as well as commitments to reforms at the provincial level.

This is the first operation approved after the commitment made in June by the IDB to support the country with a program of fast disbursement operations for a total of USD 2.5 billion to be disbursed between 2018 and 2020.

The second loan, from the Green Climate Fund (GCF), for USD 100 million, will benefit SMEs that invest in Renewable Energy and Energy Efficiency projects. Improved efficiency in the use and production of energy will help cut greenhouse gas emissions. The IDB financing is for a 20-year term. The project will be executed by the Banco de Inversión y Comercio Exterior (BICE), a public bank that grants medium- and long-term credit aimed at productive investment and foreign trade.

The Minister of Treasury, Nicolás Dujovne, met with the President of the World Bank (WB), Jim Yong Kim, and they analyzed the joint work that has to be done to promote growth and investment in Argentina. Both officials signed a new financing agreement with the International Bank for Reconstruction and Development (IBRD) for USD 300 million which will be allocated to the “Northwest Road Development Corridor” Project.

The loan is aimed at improving connectivity and road safety along the specific sections of the Argentine Northwest Corridor.

The primary beneficiaries of the project will be the users of the corridor. On average, 10,000 vehicles use the routes every day; 15% are heavy vehicles.

It is expected that logistics and freight operators will benefit from shorter travel times and operative costs and there will be an increase in comfort and an improvement in services and road safety.

At the meeting, Minister Dujovne thanked the support given to the economic program and said he was “very satisfied of having a strategic ally such as the World Bank” to continue with the process of change in Argentina. In addition, Mr. Minister thanked the World Bank for its collaboration within the framework of G20, which annual meetings are held this year in Argentina.

The President of the World Bank ratified his support to the reforms implemented by President Macri’s Administration and he highlighted the progress on social policy and infrastructure. Finally, Jim Yong Kim also highlighted the key role of Argentina in the region.

The International Bank for Reconstruction and Development (IBRD) is an international organization that supports the World Bank Group’s mission by providing loans, guarantees, risk management products, and advisory services to middle-income and creditworthy low-income countries.

Recently, the WB, within the framework of the agreement entered into with the International Monetary Fund, has made available to the country a fast-disbursing package of lines of credit for USD 1.75 billion to be disbursed in 2018 and 2019.

The loans will go toward upgrading the Belgrano Sur railway and developing electric transportation in Buenos Aires. Productive financing will also strengthen through the capital markets

Within the framework of the CLXIII Meeting held in Madrid, the Board of Directors of the Development Bank of Latin America (CAF) approved loans for USD 400 million aimed at infrastructure projects and the development of capital markets in Argentina.

USD 150 million will be allocated for the Belgrano Sur railway for doubling tracks in some areas, renovating stations and maintenance along a 47km route.

USD 100 million will be allocated for the development and research of possible electric transportation options.

Finally, USD 150 million will be allocated for the Argentine Treasury Ministry initiative known as Capital Markets Development Program for Productive Financing. This law promotes the financial inclusion of micro, small and medium enterprises in capital markets, fosters national savings and strengthens the Argentine Securities and Exchange Commission.

CAF is a development bank created in 1970, owned by 19 countries – 17 of Latin America and the Caribbean, Spain and Portugal- as well as 13 private banks in the region.

It promotes a sustainable development model through credit operations, non-reimbursable resources, and support in the technical and financial structuring of projects in the public and private sectors of Latin America.