The World Bank Board of Directors has approved two new projects for Argentina, aimed at enhancing public transport accessibility and improving the electricity subsidy system for residential users. These initiatives, totaling $1 billion in new lending, are designed to benefit vulnerable populations in the Buenos Aires Metropolitan Area.
Marianne Fay, World Bank Country Director for Argentina, Paraguay, and Uruguay stated: "These projects will help advance reforms that improve the efficiency and delivery of public services in the transport and electricity sectors, while protecting the most vulnerable population through social tariffs."
The first project, "Support to the Sustainability and Equity of Public Transport," involves a $500 million investment to finance a social fare program. This program provides a 55 percent discount on fares across 61 locations where the Unique System of Electronic Ticket (SUBE) card is available. Retirees, pensioners, and Universal Allowance (AUH) holders are among those eligible for these benefits. The project also aims to optimize bus routes based on mobility patterns and train personnel to handle sexual harassment issues in public transportation.
Furthermore, there is a plan to transition Buenos Aires Metropolitan Area’s bus fleet to low-emission vehicles as part of this initiative. The project will also develop contingency plans for extreme weather events.
The second $500 million project titled "Supporting the Transition to a Sustainable Electricity Sector" focuses on subsidizing tariffs for low-income electricity users. It will enhance the Registry of Access to Energy Subsidies (RASE) and create mechanisms to better capture information from other registries. This initiative aims at making the subsidy scheme more efficient by introducing incentives for energy efficiency and reducing electricity consumption.
Both projects are structured as variable-spread loans with a 32-year maturity period and a 7-year grace period.