He Ministry of Economy and Finance (MEF) agreed to an unprecedented loan with the world Bank for a sum of 350 million dollars, linked to the fulfillment of climate goals in the coming years, which will result in a reduction in interest rates.
He MEF and the multilateral organization indicated that it is the first credit with these characteristics and, in the event that Uruguay meets certain conditions, you can obtain potential savings of 12.5 million dollars, which could increase with the contribution of resources from developed countries.
To obtain a discount on interest rates, the country will have to exceed by one percentage point the objectives of reducing the intensity of methane emissions in the production of beef, within the framework of the commitments signed by the country in the Paris Agreement for 2025 and 2030 in the first and second Nationally Determined Contribution.
In this way, the reduction set as the objective reaches at least 33% in the intensity of emissions between 2028 and 2032. Added to this is the reduction of at least 36% between 2033 and 2037.
The government’s plan to achieve the goals
He MEF He highlighted in a statement that in order to achieve more climate goals “he will scale already validated technologies, as well as successful experiences with producers nationwide in breeding systems, expanding it to various livestock systems,” within the framework of a comprehensive plan that also added the launch of the Sovereign Bond Indexed to Climate Change Indicators.
From the wallet you drive Azucena Arbeleche They pointed out that the primary objective of the plan is to “jointly improve productive efficiency, environmental sustainability and the economic return of producers”, axes in which the country is at the forefront worldwide.
To move forward in this direction, the world Bank plans to grant 1 million dollars to the Ministry of Livestock, Agriculture and Fisheries (MGAP) to support you in that objective. Regarding the annual monitoring of the fulfillment of goals, it will begin in 2028 and will be in charge of the United Nations Development Program (UNDP).
The repercussions of an unprecedented agreement
He vice president of the World Bank, Carlos Felipe Jaramillo, highlighted that “Uruguay shows global leadership through institutional and financial innovations” and noted that “it is a time when we urgently need to redouble efforts to confront the climate crisis,” while he was proud of “that a country of Latin America “Be the first to benefit from an innovative mechanism that incentivizes actions to protect the planet.”
In turn, Senior Managing Director responsible for Development Policies and Partnerships at the World Bank, Axel Van Trotsenburg He said he was “energized” by highlighting that “it is a pioneering loan that rewards the fulfillment of ambitious environmental goals.”
Meanwhile, the minister Arbeleche valued that “the approval of this project is a first step towards a change in the global paradigm, and reaffirms the evolution of the world Bank towards the incentive of good practices.”
Source: Ambito
