CAF approves more than US $100M for water treatment upgrde in Uruguay

(Montevideo, July 3, 2012).- CAF –development bank of Latin America– approved US$100.2 million for the drinking water and water treatment systems’ improvement and rehabilitation project, undertaken by Uruguay’s state water utility Administración de las Obras Sanitarias del Estado (OSE, by its Spanish acronym).

“The goal is to improve Uruguayans’ quality of life through sustainable expansion and improvement of drinking water and water treatment services’ coverage, quality, efficiency and reliability,” said CAF President Enrique García.

“In the last decade, nations have made substantial progress in water services and treatment, and CAF’s commitment with the sector is reflected in the approval of more than US$2 billion in 2007-2011 for financing this kind of investments in the region.”

CAF’s comprehensive agenda to promote sustainable development and regional integration places special emphasis on social inclusion and environmental protection. The multilateral bank’s policy on water is therefore based on four lines of action: basin management and protection; irrigation and agricultural development; drainage and flood control, and drinking water and water treatment services.

The program’s total cost is estimated at US$143.2 million, 70 percent of which will be financed by CAF and the remainder by OSE, which will implement it.

The program contemplates rehabilitating and enlarging drinking water systems in Montevideo and the country’s interior; supporting the Settlement Regularization Plan; building six waste water treatment plants in Salto, Fray Bentos, Mercedes, Colonia, Paysandú and San Gregorio de Polanco; supporting the National Connections Plan; and building regional environmental labs.

Also, a Data Processing Center will be built for OSE’s technological upgrade and institutional strengthening, as part of the water utility’s five year 2012 – 2016 investment plan.

Resources for water treatment services in Punta del Este

In addition to this, a US$5 million loan agreement was signed with OSE for expanding the Maldonado – Punta del Este System Effluent Treatment and Final Disposal Project, an operation the financial institution had previously approved for a total of US$40 million.

The agreement was signed by García; OSE President Milton Eduardo Machado; OSE Secretary General Gustavo Antonio Pérez, and Economy Minister Fernando Lorenzo, representing Uruguay as the loan’s guarantor.

Investments contemplated in the project will expand sewer coverage to 95 percent from 53 percent, benefiting a population expected to grow to 417,000 residents by 2035. The goal is to improve the quality of life and promote social, economic and tourism development in the Maldonado province by improving sanitary and environmental conditions in Punta del Este, the provincial capital and a major resort.

Punta del Este is the biggest tourist destination in Uruguay. The district, 70 miles east of Montevideo, stretches along 40 miles of coastline. The project seeks to adjust sanitary infrastructure to meet growing demand in the resort, as well as improve the environment’s quality for the residents of Maldonado and other neighboring towns.