Paraguay. Paraguay will promote investments in energy efficiency by SMEs with a loan of 20 million US dollars from the Inter-American Development Bank (IDB). The program, financed with resources from the Green Climate Fund and executed by the Development Finance Agency (AFD), will increase SMEs' access to financial products for energy efficiency investment projects and for the reduction of GHG emissions.
Another of the projected benefits of access to this financing will be a higher productivity of SMEs, which represent 97.1% of companies in Paraguay and are responsible for 65.2% of employment. However, due to their low levels of investment and poor access to credit, they face difficulties in accessing new technologies and introducing business models that improve their productivity.
While the program will benefit industrial companies that invest in energy efficiency projects, the general population will be favored by the program's environmental and economic impacts, such as lower firewood consumption, reduced greenhouse gas emissions, and job creation.
The program will also support Paraguay's Energy Plan and Policy by encouraging greater investments in energy efficiency. In this way, the project will support the country's objectives in relation to climate change.
In addition to this program, the IDB is supporting Paraguay with $3 million in technical cooperation activities. This support seeks to promote SME investments in energy efficiency, which will replicate the IDB's Energy Savings Insurance strategy, supported by the Global Innovation Lab for Climate Finance, as one of the most promising instruments for mobilizing private sector investments towards energy efficiency.
