The government receives a $ 400 million loan “for the national decarbonization plan”

The government of the Republic signed three loan agreements totaling $ 400 million on Tuesday, which will be implemented in the National Decarbonization Plan (PND), as indicated. The credits are split into $ 250 million from the Inter-American Development Bank (IDB), $ 100 million from the French Development Agency (AFD) and $ 50 million from the South Korean government.

The funds granted by the IDB have a five-year grace period with 15 years of repayment, the same conditions that apply to the AFD loan. The South Korean credit has two and a half years of grace and twelve and a half years of repayment.

However, different interest rates will apply: for IDB funds the SOFR rate (Guaranteed overnight funding rate) plus a margin (2.70% to date). For the AFD credit, the 6-month Euribor is used as a reference (3.07% to date). In addition, the loan with the South Korean government has a fixed interest rate of 2.50%.

The signing of the contracts was attended by the Minister of Finance, Nogui Acosta, the French ambassador to Costa Rica, Philippe Vinogradoff, the representative of the IDB in the country, Fernando Quevedo, and the representative of the AFD in Costa Rica, Matthieu Robin.

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According to the government, the contract with the IDB corresponds to the program “Towards a green economy: support for the decarbonization plan of Costa Rica II”. The Executive assured that “the new credit will allow the country to deepen the reforms undertaken during the first operation, approved in 2020 for 230 million dollars”.

The contract with the South Korean government, for 50 million dollars, provides that the funds will be managed by the IDB through the Korea Infrastructure Development Co-financing Facility.

“In 2015 Costa Rica signed the Paris Agreement, signed by 192 countries plus the European Union, with the commitment to substantially reduce its greenhouse gas emissions to limit the global temperature increase. The PND includes various actions to achieve this goal, increase the country’s resilience to climate change and mitigate its effects. With the implementation of these actions, it is estimated that the benefits for Costa Rica will be 41 billion dollars between 2020 and 2050, ″ the government said.

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After the signing of the contracts, the Executive must now present the bill for the approval of the loans to the Legislative Assembly. Furthermore, they stressed that these credits allow the Ministry of Finance “to complete the financing agenda that would give Costa Rica the authorization to participate in international markets in the project known as Eurobond, which should be approved shortly”.

“This budget support funding signifies recognition of Costa Rica’s great progress in this area and seeks to accompany the progressive reduction of its carbon emissions, consolidate itself as a green economy and improve its ability to tackle climate change,” he said. affirmed Minister Acosta.

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