US$75 million to improve electricity service in Paraguay

(Caracas, July 29, 2011).- To meet growing demand for electricity in Paraguay, the National Electricity Administration (ANDE), with government support, is implementing the Support Program for the Transmission and Distribution Network of the National Interconnected System. To support the program, CAF – Latin American development bank – has approved US$75 million for ANDE, guaranteed by the Republic of Paraguay. The loan will be co-financed with an additional US$20 million from The OPEC Fund for International Development (OFID).

"The availability of a safe and reliable electricity service is a key determinant of competitiveness," Enrique García, president & CEO of the Latin American financial institution, said.

"CAF supports this Program which the government and ANDE are implementing with the objective of developing a more efficient electricity system which will contribute to raising the quality of the power supply in the country," García said.

Given the current energy emergency decreed in Paraguay following the crisis in the sector during 2010, the purpose of the loan is to partially finance various works under the Energy Master Plan which will be executed between 2011 and 2013.

The estimated total cost of the Program is approximately US$111 million, of which 68% will be financed by CAF, 18% by OFID and the remaining 14% from ANDE funds.

Since it became a "Series C" shareholder in 1997, Paraguay has had a close relationship with CAF. Relations were further strengthened and expanded in 2008 with the signing of the capital agreement which made the country a full member on special conditions, resulting in a substantial increase in support from CAF to the country.