CAF lends US$45 million to the Caracas Metro

Today the Andean Development Corporation (CAF) made a $45 million loan to the Republic of Venezuela, with 10-year repayment and 3.5-year grace periods, to partially finance the “Line 4” segment of the Caracas Metro, which will span the distance between Capuchinos and Plaza Venezuela.

The loan agreement was signed at CAF’s headquarters by its executive president, Enrique García, and the president of C. A. Metro de Caracas (Cametro), José Alberto Rosales. García praised the project, which will decongest two-way traffic between central and eastern Caracas.

García pointed out that the Caracas Metro is the least polluting mass transit option, compared to other alternatives that generate vast quantities of toxic emissions into the atmosphere, such as an increase in urban transport vehicles. This benefit may make the project eligible for inclusion in the Latin American Carbon Program (PLAC,) promoted by CAF both to bring financial benefits to its clients and to reduce carbon dioxide emissions.

The project, in addition, will bring socioeconomic benefits that go beyond the mass transit service, generating external economies within the project’s sphere of influence and a many-fold increase in commercial activity. Currently, of the more than five million people that daily transit Caracas by either private or public conveyance, close to one million use the Metro.

The loan is set within the framework of the agreement recently signed between CAF and Brazil’s Banco Nacional Do Desenvolvimento (BNDES), under which the latter institution provides up to $107 million for export credit. The proceeds of today’s loan by CAF will be used to finance civil works, including track, machinery, and equipment for the five stations in Line 4’s approximately 3-mile-long span.