WASHINGTON, December 18, 2008— The World Bank (WB) Executive Board of Directors approved today a US$401 million loan to the Mexican government for the Environmental Sustainability Development Policy Project to compensate for a tight public sector budget during this trimester.
This financing is in addition to the US$300.75 million loan approved last October and responds to the limited financing due to deteriorating global economic conditions.
“Substantial changes in the global economic and financial conditions have also had an impact on Mexico. As a result, the government has requested supplemental financing from the World Bank. This operation constitutes the first response to such requirement”, said Axel van Trotsenburg, World Bank Director for Mexico and Colombia. “This operation supports the environmental agenda. Next operations will support the social sectors, including the Oportunidades social protection program,” he added.
Environmental sustainability is a key pillar in the National Development Plan 2007-2012, and the Environmental Sustainability Development Policy Loan is aligned with the strategy included in this plan.
The strategy seeks to make headway in designing environmental concerns within public policies in order to increase competitiveness and social and economic development, while protecting the environment.
The main sectors considered within the project are:
- Sustainable forest management
- Water and sanitation
The program seeks to reduce water and air pollution, promote the efficient use of water and energy, and the conservation of forest resources and land.
“Among the results we hope to obtain with this project are, for example, to achieve the sustainable administration of a million hectares; that 50 percent of the companies related to tourism operate under environmental quality criteria; at least a 4 percent increase in treating residual water on a municipal and industrial level; implement 32 conservation projects and install 24 communication strategies in the Mesoamerican Biological Corridor, in favor of its conservation,” said Angela Armstrong, World Bank Senior Operations Officer and project leader.
This is a fixed-spread loan with a 17-year grace period. The total amount is to be paid in a single tranche in 17 years. This financing will be disbursed in a single operation.