Government

Marina del Pilar arranges financing for the progress of water sanitation project in Baja California

With support from the federal government and Nadbank, the governor of Baja California takes a fundamental step to resolve binational problems and ensure clean water for the state

By Redacción2023-03-10T04:00:00+00:00

Marina del Pilar Ávila Olmeda, the governor of Baja California, formalized the first sustainable financing with the North American Development Bank (NadBank) for an amount of 3 billion pesos, in order to deal with the historic hydraulic infrastructure abandonment and guarantee a proper supply of water for Baja Californian families through concrete actions regarding water sanitation.

The governor of Baja California stated that, with this, the fulfillment of the goals that Mexico committed itself with as part of the 2023 Agenda of the UN Conference on Climate Change and Sustainable Development Objectives are guaranteed.

In her message, Marina del Pilar highlighted the importance of water as an instrument to build a better future, which motivated the coordination of the three levels of the Government of Mexico, led by President Andrés Manuel López Obrador, who has promoted a permanent coordination with the United States. Thanks to this, in addition to the intervention by Nadbank, there will be a historic improvement regarding water management in the Tijuana river and Californian and Baja Californian coasts.

“This signing is an example of what we can accomplish when we work together. To reach this moment is the result of long meetings and conferences where more than 100 hundred professionals from Mexico and the United States were involved to define a joint strategy. With this solid teamwork, we are taking a fundamental step that will positively impact the quality of life of future generations on both sides of the border,” the governor said.

Marina del Pilar emphasized the importance of the proper treatment of wastewater in order to plan for an optimal regional development, which is why she recognized Nadbank, as well as the International Boundary and Water Commission and the US Environmental Protection Agency.

She explained that in this first stage the International Wastewater Sanitation Plant will be expanded to double its current ability to treat Mexican wastewater that crosses into the United States. In addition, there will be improvements of sanitation infrastructure and reuse of wastewater treated at plants La Morita and Arturo Herrera.

“We are guaranteeing immediate implementation with these actions, but the most important thing is that today we are laying the foundations for long-term sustainable development,” she explained.

For his part, the Secretary of Finance of Baja California, Marco Antonio Moreno Mexía, highlighted that for the first time the state government has signed Green Financing, an innovative financial instrument that will allow greater transparency in investments regarding infrastructure, promoting holding entities accountable, and greater clarity regarding expected results.

At the same time, the state official emphasized that these financing actions are following both the 2019-2024 National Development Plan and the 2022-2027 State Development Plan of Baja California.

“Thanks to the strength of the structure and the great financial development of Baja California, commercial banks and development showed interest in this type of financing, which allowed the state to receive proposals that reached 6.750 billion pesos, which is 2.25 times more than the goal,” he said.

Moreno Mexía stated that Nadbank helped in creating the Sustainable Financing Framework and will provide 257,000 dollars of non-refundable resources from its Technical Assistance program in order to support the implementation of this financing.

Gabriel Yorio Gonzalez, Subsecretary of Finance and Public Credit, said that Baja California has implemented an innovative practice subnationally that other states, especially those in the border, will probably adopt in the near future.

He added that this practice is known as “Sustainable Financing Framework” and its goal is to identify sustainable projects to channel the necessary resources, as well as ensure that their purpose is fulfilled effectively. The official stated that at the Secretariat of Finance and Public Credit they are developing a sustainable financing strategy that is looking to mobilize economic resources towards projects and actions to benefit the environment and society.

For his part, the general director of NadBank, Calixto Mateos, stated that green financing has a 30-year term, with a grace period of capital payment of three years and growing repayments of 1.1%, which will allow it to come true and mature. In addition, it has competitive interest rates. This financing is divided into two paths: the first one for 1 billion pesos with a fixed rate of 10.165%, well below an Interbank Equilibrium Interest Rate (TIIE) of 28 days, and a second path of 2 billion pesos at a TIIE rate of + 0.925%.

Green Financing is part of the “Sustainable Bonds Framework of Baja California” which is based on the general climate change and social policy strategy of the state and the country, aligned with the UN Sustainable Development Objectives, also known as global objectives. This were also adopted by the United Nations in 2015 as a universal call to end poverty, protect the planet, and guarantee that all people enjoy peace and prosperity by 2030.