Friday, September 26, 2008

IDB offers grants to jump-start water and sanitation projects in the Caribbean

Published: Friday September 26, 2008

Caribbean and Latin American governments that want to improve water and sanitation services can now apply for grants from the Aquafund, a new source of financing approved by the board of the Inter-American Development Bank (IDB) on Monday.

The Aquafund is a fast-disbursing vehicle intended to help accelerate the development of projects in the water, sanitation and solid waste disposal sectors. It can be used to finance activities ranging from pre-feasibility studies to technical training and knowledge dissemination, depending on specific local needs.

"There are many innovative proposals for improving water and sanitation services in Latin America today," said IDB President Luis Alberto Moreno. "Aquafund was created to help make those proposals a reality by financing the early stages of project preparation, and also to help replicate successful experiences on a larger scale."

During the rest of 2008, the Aquafund could disburse up to $15 million in grants from the IDB's ordinary capital. Starting in 2009, Aquafund will also mobilise matching contributions from multiple donor countries, providing up to $35 million in grants during the calendar year. Aquafund will also be able to receive contributions from private sources.

Aquafund grants can be used to support projects that subsequently receive both loans with either sovereign or non-sovereign guarantees. It is expected to finance activities such as improvements in the legal and regulatory framework, water resource management, and capacity building at municipal, state and national level. Aquafund grants will also be available directly to water, sanitation and solid waste service operators.

"We expect Aquafund to be a catalyst for innovative approaches to these areas," said Federico BasaƱes, chief of the Water and Sanitation Division at the IDB. "We have set ourselves the goal of financing projects with 100 of the region's cities and 3,000 of its rural communities by 2011, and Aquafund is going to be a key resource for municipalities that need help getting projects off the ground."

Starting in 2009, the Aquafund will use contributions from donors to finance pilot investment projects that use new technologies and have potential for replication.

Donor funds will also be available for investment projects focusing on service expansion, low-income urban and rural communities, household connections to water and sanitation networks, wastewater treatment and solid waste disposal.

Source: Jamaica Observer

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