World Bank Supports Mexican Initiative to Improve Environmental Management in Key Sectors of the Economy
US$300 Million to Develop Environmental Policies
Available in: Español
Press Release No:2009/102/LCR
Contacts:
In Washington:
Gabriela Aguilar (202) 473 6768
In Mexico City:
Fernanda Zavaleta (52-55) 54804252
Washington, DC October 2, de 2008—The World Bank Board of Directors approved today a loan for US$300.75 million to assist the Mexican government in its effort to better integrate sector policies in order to achieve a balance between socioeconomic development and environmental protection and improvement.
The amount is complementary to previous loans –US$501.25 million approved last April for climate change, among others– and seeks to establish the considerations on the subject of environmental integration in public policies.
¨The Environmental Development Policy Loan seeks to integrate environmental concerns in key sectors of development, like tourism, energy, forestry, water, agriculture and housing, which are already government priorities¨, says Axel van Trotsenburg, World Bank Director for Mexico and Colombia. ¨The World Bank reiterates its commitment with the country and recognizes its contributions in the climate change agenda, with concrete actions such as public policy development, strengthening institutions, air pollution prevention, the administration of water resources, conservation of natural resources and solid waste management ¨, he added.
Environmental protection is relevant in improving competitiveness in the productive sectors, as well as the country’s economic and social development. The credit intends to advance the integration of environmental interests in the planning process to promote production and sustainable consumption, prevent environmental degradation and its costs, and ensure the development of opportunities.
The project is expected to have a positive social impact, particularly on the most vulnerable sectors of the population. World Bank studies on Mexico’s poverty show that environmental degradation affects the poor to a greater extent than the more privileged sectors. On one hand, the contamination of water and air brings about health problems and, on the other, the degradation and non-sustainable management of land and deforestation negatively affect the way of life of this sector by making it more vulnerable to natural disasters.
The key development areas mentioned have an established environmental agenda and were selected by taking the following criteria into account:
- Urgency based on adaptation with growth and investment, in terms of potential impact or growth commitment, as is the case with water.
- Urgency as a result of degradation.
- Compatibility with poverty reduction, particularly in the cases in which natural resources are essential for sustained housing, like the forestry sector.
- Opportunities based on sector consensus, such as agriculture.
The DPL supports the government in outlining the following environmental considerations:
- Supporting the energy, water and housing sector in integrating environmental concerns and contributing to making the use of water more efficient, as well as reducing contamination, increasing energetic efficiency and backing initiatives in renewable energies. In order to: i) improve energetic efficiency by promoting the use of alternative sources of renewable energies; ii) increase energy at least 10% compared to the consumption in 2007; iii) increase the treatment of residual waters 4% and iv) incorporating practices in favor of more efficient consumption of energy and water in the development of new housing.
- In the tourism sector: the political reforms related to participatory planning and certifications for environmental quality help integrate the sustainability of this fast growing sector. Entities from the public and private sectors will be involved, as well as members of the community, in order to generate joint actions. The objective is to achieve a 50% increase of companies which operate in line with environmental quality criteria established by the Ministry of Tourism, the Federal Environmental Protection Agency and the Mexican Association of Hotels and Motels.
- In the agricultural and forestry sectors, the reforms will be supported by the administration of natural resources, especially water by: i) adding 50,000 hectares of cultivable lands and ii) administrating 1.0 million in a sustainable manner
The project is a part of the new Country Partnership Strategy that the World Bank signed with Mexican authorities last April, in line with the five pillars of the National Development Plan 2007 – 2012.
One of those pillars is environmental sustainability, and the loan will be a key element in contributing to making the environment a significant element in public policy and ensuring that public and private investment is compatible with environmental protection.
The National Savings and Financial Credit Bank (BANSEFI) is the loan’s financial agent, which will be implemented by the Ministry of Environment and Natural Resources (SEMARNAT), the Ministry of Finance and Public Credit (SHCP), the Ministry of Tourism (SECTUR), the National Forestry Commission (CONAFOR), the National Water Commission (CONAGUA), the Ministry of Energy (SENER), the Ministry of Livestock, Rural Development, Fisheries and Food (SAGARPA) and the National Housing Commission (CONAVI).
¨This is a challenge that affects all the countries, at all governmental levels, the private sector and civil society as a whole. The coordination between sectors will be essential in turning these policies into actions, ¨ concluded van Trotsenburg.
This is a US$300.75 million fixed spread loan with a 15 year grace period and a total repayment period of 15 years. The front end fee is equivalent to 0.25 percent of the loan and capitalized.
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For more information on the World Bank and Mexico, please visit:
http://www.bancomundial.org/mx
For more information on the project, please visit this website
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