ECUADOR —The Inter-American Development Bank (IDB) has approved a $128.48 million financing package to support water infrastructure improvements across Ecuador and strengthen the financing capacity of Banco de Desarrollo del Ecuador B.P. (BDE B.P.). The package comprises a $120 million multiple works investment loan, a $4.76 million loan from the Green Climate Fund and a $3.72 million grant from the same fund. The programme also includes $12 million in local counterpart funding.
The investment is intended to improve access to drinking water, sanitation and solid waste management while increasing the resilience of water systems to climate-related pressures. Around 283,000 people are expected to benefit directly, including approximately 166,000 residents in the Ecuadorian Amazon. Planned interventions also include improvements to stormwater drainage, helping communities manage flood risks and periods of drought.
The programme addresses interconnected infrastructure and environmental challenges. Reliable drinking-water and sanitation services are essential to public health, while effective waste management can reduce pressure on local waterways and surrounding ecosystems. In the Amazon region, where climate vulnerability and ecosystem protection are central concerns, improved drainage and water-resource planning are intended to support both community resilience and longer-term conservation objectives.
The financing aligns with Amazonia Forever, an IDB Group initiative focused on sustainable development and the protection of Amazon ecosystems. Its regional focus gives the programme significance beyond individual municipal infrastructure projects: improved water services and climate adaptation measures can support local communities while contributing to broader efforts to manage environmental risks across the Amazon basin.
The financing instruments carry different repayment conditions. The $120 million investment loan has a 23.5-year repayment term and a seven-year grace period, with an interest rate based on the Secured Overnight Financing Rate (SOFR). The $4.76 million Green Climate Fund loan has a 20-year repayment term, a five-year grace period and a 0.75% interest rate. The accompanying $3.72 million grant provides additional climate-related support without adding loan repayment obligations.
The IDB is a multilateral development bank that finances economic and social development across Latin America and the Caribbean. BDE B.P. is Ecuador’s public development bank, which supports financing for public investment and infrastructure. Strengthening BDE B.P.’s ability to mobilize capital is a stated objective of the programme and could help support implementation of water-sector investments. For public authorities, utilities and infrastructure contractors, the package creates a funding framework for projects involving water supply, sanitation, drainage and waste services. The announcement does not specify individual project locations, procurement schedules or construction deadlines.
