Washington April 7th, 2017 – More than 1.4 million people will benefit from a new loan approved yesterday by the World Bank Board of Directors for US$ 300million to strengthen flood protection in the Salado river basin within the Province of Buenos Aires.
“For years we, Buenos Aires residents, have suffered every time it rains due to a decades-long lack of investment. We are beginning to undertake works which will take time, the sort that won’t be seen in the short-term, but which will change people’s lives. Thanks to the World Bank’s input will be able to invest in improving the infrastructure and strengthening the economy of our Province,” said Maria Eugenia Vidal, governor of the Province of Buenos Aires.
“This project is an example of World Bank support to Argentina to improve the standard of living of the population”, said World Bank Vice-president for Latin America and the Caribbean, Jorge Familiar. “We will continue working with the country to strengthen infrastructure and productivity, among other issues, so as to promote sustainable growth and job creation.”
This loan is part of the “Salado Integrated River Basin Management Support Project”, which will finance works to adjust the river basin in order to contain rising waters and to minimize the impact of floods along 34 km of the middle course of the river and to enhance bridges so as to reduce risks to human life and economic activities. It will also finance the strengthening of institutional capacities for improved water resources management, protecting the environment, and supporting the sustainable management of infrastructure investments.
The project will benefit the Basin’s entire population – 1.4 million people – and the structural work will directly and positively impact the populations in the districts of San Miguel de Monte, Lobos and Roque Pérez, an estimated 75,000 inhabitants. The Salado River Basin is situated in the central-northern part of the Province of Buenos Aires, and is of strategical importance not only to the regional economy, but also at a national level. The area’s agricultural production is responsible for 20 percent of national grains and meat production, contributing significantly to national export income.
“We need more investment in infrastructure, not just to guarantee the wellbeing of the population, but also to develop a more competitive economy and to create genuine employment. For this reason, it’s fundamental that we have a strategic ally like the World Bank, who guarantees us the financing we need to grow,” said Luis Caputo, Minister for Finance in Argentina.
Extreme climate events periodically and recurrently threaten the Province of Buenos Aires through floods and prolonged droughts. From 2000 to 2011, floods generated losses of US$ 4.5 billion and affected more than five million people in the Province. In 2015, the highest level of precipitation on record within the Salado River Basin caused flooding over more than 800,000 hectares, causing the death of over 6,000 cows and losses of over US$652 million.
The project will be financed by a variable spread loan of US$300 million, with a 27.5-year total maturity period, including a 5-year grace period.