CABEI and Green Climate Fund sign agreement to implement climate change adaptation program to benefit more than 2 million people in the region
This is the "Ecosystem-based Adaptation to Increase Resilience to Climate Change in the Central American Dry Corridor and Arid Zones of the Dominican Republic" program approved by CABEI in March 2022.
Tegucigalpa, November 22nd, 2022.- With the objective of improving the capacity of the countries of the region to adapt to the adverse effects of climate change, the Central American Bank for Economic Integration (CABEI) and the Green Climate Fund (GCF) signed a Financing Activity Agreement establishing the terms for financing the "Ecosystem-Based Adaptation to Increase Resilience to Climate Change in the Central American Dry Corridor and Arid Zones of the Dominican Republic" Program for an amount of US$174.3 million. The Program will also receive reimbursable financing from CABEI in the amount of US$42.8 million, and contributions from the participating countries in the amount of US$51.3 million, for a total of US$268.4 million.
"Through this program, communities located in this region, smallholder and commercial farmers, as well as rural entrepreneurs, will have greater access to the financial resources and technical skills needed to implement high-impact adaptation interventions. The dry corridor is a region that is highly affected by the climatic events we experience every year, especially prolonged droughts, which put food security at risk in these populations of our countries," highlighted CABEI Executive President Dr. Dante Mossi.
Of the total amount of the Program, US$135.6 million will be non-reimbursable funds to implement Ecosystem-based Adaptation (EbA) measures and technical assistance; US$102.8 million will be resources for granting loans through Intermediary Financial Institutions in the region; and US$30.0 million will be used to establish a partial loan guarantee fund to facilitate and encourage the placement of EbA loans in the region.
The Program is a regional initiative that is expected to benefit an area of approximately 20,530 km², reducing deforestation in the prioritized areas of Guatemala, El Salvador, Honduras, Nicaragua, Costa Rica, Panama and the Dominican Republic. It will also initiate a paradigm shift in the regional approach to water catchment and demand management in the Dry Corridor and Arid Zones, and accelerate the adoption of EbA and other measures that will increase resilience to extreme climate events, such as severe drought and extreme precipitation.