Germany’s Ministry of Economic Cooperation and Development offers CAF financing for up to EUR 150 million
This initiative will reduce funding costs to advance projects that boost productivity and enhance well-being of the population through improved power transmission and distribution systems in the region.
Germany’s Ministry of Economic Cooperation and Development (BMZ), through the Kreditanstalt für Wiederaufbau—KfW— (German Development Bank), will launch a new line of credit for up to EUR 150 million to CAF—development bank of Latin America—to promote energy efficiency in the power transmission and distribution sector, through projects that help mitigate the impact of climate change (energy saving) and enhance productivity and well-being of the population.
The impact of such lines of credit is financially relevant as it reduces financial costs of projects, and therefore improves feasibility and funding to enhance project design (detailed and technical studies).
For more than 40 years, CAF and KfW have provided funds for climate-friendly investments, especially in the areas of renewable energy, energy efficiency (revamping of power plants, transmission lines and substations), industrial environmental protection, water and sanitation, sustainable development of cities and urban mobility, among others. These investments have helped expand environmentally friendly infrastructure in CAF member countries by funding more than 40 projects with these facilities in recent years.
Over the past decade, CAF and KfW have finalized more than USD 1.2 billion in concessional lines of credit focused on CAF-funded projects in the region, and loans over the past 5 years alone total USD 622 million. In addition, non-reimbursable monies and cooperation funds have been disbursed to promote pre-feasibility, feasibility studies and implementation of CAF projects in their initial phase, thanks to the support of Germany’s BMZ and the European Commission through the Latin America Investment Facility (LAIF).
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