The IDB Group has approved a $65 million loan to help Uruguay repair several segments of road throughout the country. These transport infrastructure improvements will play a key role in boosting the competitiveness of the forestry and agro-industrial industries.
The lockdown prompted by the COVID-19 pandemic, coupled with an associated drop in demand, triggered a widespread decline in global economic activity, and Uruguay was no exception – it saw its real gross domestic product plunge by 4.5 percent in 2020.
The government has identified the transport infrastructure and services sector as one of the pillars for the country’s economic recovery. The Bank’s support will contribute to lower transportation costs and boost exports competitiveness, thus helping put Uruguay’s productive sector back on its feet again.
Under the program to improve agroindustrial and forestry road corridors, the National Development Corporation will use the funds to rehabilitate and widen some road sections and bridges along Route 6.
In addition to helping improve key road infrastructure, the funds include an institutional strengthening component to finance technical studies, procurement of technological equipment, implementation of a new road asset management system, and the design and implementation of a road transportation and infrastructure management center.
This program is aligned the Vision 2025 created by the IDB Group to achieve economic recovery and inclusive growth in Latin America and the Caribbean in one of its key pillars – regional integration.
The IDB also deems essential to help prevent and mitigate gender-based violence. Therefore, it contemplates the implementation of measures to help close the gap of female participation in the labor force through technical training, mentoring and internship program with equal participation for women and men.
The program’s total cost is $77.8 million, of which $65 million will be financed by the Bank, with the remaining $12.8 million coming from local counterpart funding. The IDB loan will be disbursed over a 4-year period, which is in sync with the program’s works schedule, and has a 14-year repayment term, with a 5.5-year grace period and interest rate based on LIBOR.
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance and training to public and private sector clients throughout the region.