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Uruguay departmental governments to make strategic investments and improve their management with IDB support

Program includes carrying out works in the 18 departments of the country’s interior, home to 2 million people

The Inter-American Development Bank (IDB) approved a loan of $70 million to finance a program to help modernize the Uruguayan government’s interior departments by improving their financial autonomy and ability to provide basic services.

The Subnational Program for Development and Management will include investments for development projects in 18 departments that are home to some two million people, or about 60 percent of the country’s total population.

"The program aims to strengthen the capacity of departmental governments in public policy and investments, in this way helping them to better meet the needs of the people," said Veronica Adler, IDB project team leader.

Financing will be provided to improve the institutional capacity of departmental governments in the areas of financial planning, public investment and tax revenue management, land management, and improving and expanding coverage of basic services.

Investment projects in urban areas include improvements in the urban environment, infrastructure for accessibility and connectivity, measures to mitigate and adapt to the effects of climate change, services, and urban facilities.

Measures to modernize the departmental governments include improvements in tax administration and integrating these improvements into the National Public Investment System and the Integrated Financial Information System; and capacity building in land management.

The IDB loan for $70 million has a 25-year term, a five-year grace period, and a variable interest rate based on LIBOR. Local counterpart funding totals $15 million.

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