(MENAFN- Caribbean News Global) BELÉM, Brazil - The Inter-American Development Bank (IDB), Impact Fund Denmark, the Norwegian Agency for Development Cooperation (Norad), and the Swedish International Development Cooperation Agency (Sida) signed a letter of intent [today] toward establishing a new guarantee. This new partnership is expected to result in approximately $800 million in additional IDB lending capacity for clean-energy projects under the Amazonia Forever América en el Centro

This additional capacity will enable the IDB to scale investments across the Amazon region and Central America by supporting projects that expand energy access, modernise transmission and distribution networks, promote clean electricity systems, advance sustainable transport, scale clean cooking solutions, increase energy-storage capacity, and strengthen emerging clean technology sectors.

The IDB has a strong track record of risk-transfer guarantees. In 2021, a $100 million transaction with Sida unlocked funding for projects focused on poverty alleviation, climate resilience, and support women in Bolivia, Colombia, and Guatemala, followed in 2024 by a second $250 million guarantee with Sida that unlocked $469 million in additional lending for the Amazon region under Amazonia Forever.

The proposed new guarantee – now with Impact Fund Denmark, Norad, and Sida – is expected to further bolster the IDB's regional programs, deepen collaboration with Denmark, Norway, and Sweden, and advance the IDB Group's Institutional Strategy by mobilising additional resources through balance-sheet optimisation and innovative risk-sharing with partners.

“We are glad to work closely with Sida, Impact Fund Denmark, and Norad towards a new credit-substitution guarantee – our third with Sida and our first with Impact Fund Denmark and Norad. Through innovative financing, we are facilitating the mobilisation of financial resources to strengthen energy security, resilience, and inclusive growth in Amazonia and Central America,” said IDB Group president Ilan Goldfajn.

“Guarantees are powerful catalysts for climate action. By partnering with the IDB, Denmark, Norway, and Sweden are unlocking approximately 800 million dollars for clean energy and sustainable development in the Amazon region. This collaboration shows how innovative financial risk-sharing models can accelerate green investments where they matter most-protecting biodiversity and supporting communities for generations to come,” said CEO at Impact Fund Denmark Lars Bo Bertram.

“We are proud to announce the first guarantee under the Norwegian Sovereign Guarantee Scheme, and it is especially rewarding to do so together with Sweden and Denmark. The Amazon region – where Norway has been the most important partner for rainforest conservation during the last 15 years – is extremely energy-poor. This guarantee will address that by enabling close to $800 million in renewable investments, with significant positive effects for the people, environment, and economic development,” said Jonas Gahr Støre, prime minister of Norway.

“This partnership with the IDB demonstrates how innovative financial instruments can multiply development impact. By combining Sweden's, Norway's, and Denmark's guarantee mechanisms, we are helping to unlock substantial new lending capacity for sustainable investments in the Amazon, aligning financing with both climate and development goals,” said assistant director general and head of the department for trade, the private sector, and financial instruments at Sida, Kjell Forsberg.

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