Latin America development bank approves US$175m transport loan for Trinidad and Tobago

The Development Bank of Latin America (CAF) has approved a US$175 million loan for TT, aimed at modernising its transport infrastructure.

In a statement posted on its website on Tuesday, CAF said, "The loan will be used for institutional strengthening, particularly updating plans, strategies and modernising the regulatory framework of process management, such as updating laws related to land transport, developing a policy for the maritime sector, plan strategies for public transport and the air sector, quality systems, etc."

CAF said the credit will also be used to improve the quality of infrastructure, with initiatives such as feasibility studies, modernising roads, ports and airports and road maintenance, among other things.

The bank's interim president Remy Lopez said, “The quality of transport infrastructure and services are key factors to enhance economic development, productivity and competitiveness.

"This loan will support the process of improving services and the management of the transportation sector in TT and will offer competitive advantages to serve the market and provide better services to its citizens."

From 2016-2020, CAF said, it approved operations for TT totalling US$1,151 million, which represents an average of US$288 million per year.

"This instrument highlights a continuity of loan and technical assistance operations that began in 2019 to strengthen economic and social infrastructure in the country, with an emphasis on roads, maritime and tourism sectors, as well as resilience to natural disasters."

On June 25, 2020, Finance Minister Colm Imbert and CAF director representative Gianpiero Leonici signed a loan agreement aimed at strengthening TT’s capacity to respond to the crisis caused by the covid19 pandemic, through direct financial resources and the recognition of expenses and investments aimed at mitigating the impact of the pandemic on the health of the population.

The first loan, of US$100 million ($676 million), will provide financial support to the Government’s economic programmes, implemented to contain the social, economic and financial emergencies generated by covid19.

Leoncini explained this loan, which is for budget support, was provided from a credit line created specifically for the impact of covid19 in Latin America and the Caribbean.

"We offered very rapid support for member countries."

The second loan, of US$50 million ($338 million), will contribute to strengthen TT's health-system capacity to respond to the crisis caused by covid19, through direct financial resources and the recognition of expenses and investments aimed at reducing the risk, or mitigating the impact, of the pandemic on the health of the population.

Leoncini explained this loan was from contingent credit from 2014 and was set up specifically for pandemics. It was originally envisioned for Ebola, but was not accessed for that purpose.

These two loans were preceded by a US$400,000 ($2.7 million) donation that the multilateral organisation made to the country on April 3 to help fight the spread of the pandemic.