World Bank Support for Environmental Improvements in Colombia

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The FINANCIAL — The World Bank Board of Executive Directors approved a €637.7 million (US$700 million) loan on September 30 in favor of green growth and the quality of the environment in Colombia. This Development Policy Loan (DPL) was designed to support the Colombian administration’s budgetary program.

More specifically, the loan will support the National Development Plan of Colombia’s green growth strategy as well as improve the quality of the environment by reducing water and air pollution as well as the final disposal and recycling of solid waste. Adaptation and resilience to climate change and a reduction in the costs of environmental degradation on health are just some of the main challenges the country faces, according to the World Bank.

“The National Planning Department in Colombia led the structuring of a US$700 million loan operation with the World Bank, which, as well as financing this nation’s budget, promotes an important regulatory and policy reform of the cross-cutting green-growth strategy,” said Simon Gaviria Muñoz, Director of the National Planning Department. “This operation seeks, in a balanced way, to promote social, economic and environmental development, in accordance with the 2014-2018 ‘Everyone for a New Country’ National Development Plan.

The rate of exploitation of Colombia’s natural resources is greater than the average for Organization for Economic Development and Cooperation (OECD) countries. For example, extensive cattle raising, mostly undertaken in unsuitable lands, has caused significant deterioration in land use. Equally, the industrial sector is one of the biggest culprits behind organic pollution and the deterioration of water quality in Colombia.

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“Advances in environmental sustainability benefit the most vulnerable, who are normally the biggest victims of environmental degradation issues,” said Gerardo Corrochano, World Bank Director for Colombia and Mexico. “This loan thus seeks to improve those environmental conditions that improve the health situation and well-being of the poorest, while promoting improvements in productivity and quality of life for all Colombians.”

A further line of action aims at strengthening the response capacity to climate change and natural disasters. Via these activities, the World Bank supports the government in its goal of redirecting the country’s growth through the preservation of natural resources, improving the quality of the environment and strengthening its resilience to natural disasters and climate change.

The Government has chosen a single payment at maturity. The loan will be entirely paid off in 2035.

 

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