COVID-19: Green reconstruction in Peru

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With the overarching objective of contributing to the implementation of the Peruvian government's climate protection strategy, the Peruvian development bank COFIDE is to be provided with a low-interest loan as an open credit line of up to EUR 250 million in USD equivalent as part of its government mandate to promote climate finance. Due to the ongoing Corona crisis and the associated economic recession, the project is initially intended to provide short-term support to the Peruvian economy as part of the Corona emergency aid program passed by government decree in combating the immediate negative consequences of the pandemic for micro and small enterprises (MSEs). The central instruments of the Peruvian Corona emergency aid program are the specially set up national guarantee funds Fondo de Apoyo Empresarial a Micro y Pequeñas Empresas (FAE-MYPE) and Fondo de Apoyo Empresarial a Micro y Pequeñas Empresas del Sector Turismo (FAE-TURISMO), which, depending on the loan amount, guarantee up to 98% of individual loans to local FIs or credit cooperatives (and thus indirectly to COFIDE). The French Agence Francaise de Developpement (AFD), the Corporación Andina de Fomento (CAF) and the European Investment Bank (EIB) are also expected to participate in the program. The contribution to green reconstruction (COVID-19 green reconstruction) will be made by financing climate-friendly investments as soon as the Peruvian economy has recovered, the short-term Corona emergency aid has been repaid to the FI or COFIDE and the willingness of companies to invest has increased again in the coming years.