Climate-friendly public transport systems in Latin America

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Aim of the program Contribution to the development and expansion of climate-friendly public transport and logistics systems. Target group The project is aimed at Latin American developing countries and state development banks via the CAF, to which reduced interest rates are made available through the program. The population is the ultimate target group at the selected project locations. So far, the populations of Quito / Ecuador, Buenos Aires / Argentina and Niterói / Brazil have been identified together. Indicators for goal achievement a) Reduction of greenhouse gases Saving of around 200,000 t CO2 / year (monitoring via the CAF) b) Additional mobilization of financing for climate-friendly, adapted public transport and logistics systems (CAF's own resources of USD 200-400 million). Initial situation Around 80% of the Latin American population lives in cities There are around 60 cities with more than a million inhabitants, several megacities even with more than 10 million inhabitants. Public transport systems play a key role in determining the level of economic productivity in these cities, the quality of living conditions of residents and their access to jobs and government services. The consequences of inappropriate public transport and logistics systems are high traffic volumes, environmental pollution, high greenhouse gas emissions and significant transaction costs for economic actors, which have a negative impact on integration into international value chains. Energy consumption in the transport sector has grown four times faster than total energy consumption over the past 30 years. Oil consumption in the transport sector is one of the largest sources of greenhouse gases. Around 80% of these emissions are caused by private transport. For the sustainable development of Latin America, it is therefore crucial to use scarce energy resources more efficiently by applying adapted forms of technology (BRT systems, light rail, metros, logistics infrastructure) and thus minimize the impact on the environment and climate. Project assessments are carried out by KfW on the basis of CAF program documents with an expanded environmental and social assessment. The CAF program documents will include a mandatory review of the impacts of infrastructure projects on climate change and, where appropriate, climate adaptation. KfW will also carry out individual on-site audits. Design of the FC project The funds will be used directly by CAF to refinance loans, without involving commercial banks. CAF must provide evidence of the development impact, sustainability and climate impact of the projects to be financed. Individual projects will be submitted to KfW for no objection. CAF passes on the interest advantage from the FC funds to final borrowers (the German development cooperation will be mentioned). The regional project will be supplemented with considerable CAF's own funds. The share per borrower is to be limited to a maximum of USD 40 million. We are assuming an FC contract at the end of 2017.