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IDB Approves Loans for USD 400 million to Foster Investment and Finance Renewable Energy Projects in Argentina

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.