Nearly 31,000 households in rural areas and towns of up to 30,000 inhabitants will gain access to water and sanitation services with a US$45 million loan approved by the IDB.

The Inter-American Development Bank (IDB) has approved a US$45 million loan to finance the Potable Water and Sanitation Program in Honduras, which will benefit nearly 31,000 households in rural areas and towns of up to 30,000 inhabitants by providing them with new and improved access to these basic services.

The program aims to improve the living conditions of families in rural and periurban areas, which have historically lacked access to basic drinking water and sanitation services. It will be executed by the Secretaría de Estado en los Despachos de Desarrollo Comunitario, Agua y Saneamiento (SEDECOAS, the Department of Community Development, Water, and Sanitation). The project will also help strengthen water security in Honduras, in particular in the most vulnerable communities, improve water utilities’ management in order to ensure the sustainability of infrastructure investments, and boost climate change resilience.

The program consists of two major components. The first, US$38.6 million component will be used for building new drinking water distribution systems and sanitary sewers, individual sanitation solutions, and excreta and wastewater treatment systems. These investments will be designed taking into consideration potential natural disaster hazards and climate change effects. They will also have a strong focus on community participation in the systems’ operation, maintenance and administration and on the promotion of changes in user behavior for the proper use of the infrastructure and facilities built. All social management activities will mainstream gender and diversity considerations, promoting the equal participation of men and women, especially in training and decision-making.

The second component, of US$3.21 million, will be used for preinvestment plans and for sector strengthening activities at national, departmental, and municipal entities in priority areas in order to strengthen their planning, monitoring and technical capacities so they can better contribute to system sustainability.

The IDB financing comes from two sources: 65% from the Bank’s Regular Ordinary Capital, for a 25-year term, with a 5.5-year grace period and a LIBOR-based interest rate, and the remaining 35% from concessional funds, which will have a 40-year amortization period, 40 years of grace, and 0.25% interest.