Infrastructure Bank, EPA Partner to Advise Cabo Verde on Sustainable Financing Programs for Water and Sanitation Infrastructure

Rhode Island Infrastructure Bank’s Michael Baer recently joined members of the U.S. Environmental Protection Agency (EPA) in Cabo Verde on a trip funded by the Millennium Challenge Corporation’s (MCC) Cabo Verde Compact for Water program. MCC is an independent agency created by the United States Congress in 2004 whose mission is to reduce poverty through economic growth. MCC works to form partnerships with some of the world’s poorest countries, assisting in developing country-led solutions and implementation that improve infrastructure, including clean water and sanitation.

MCC’s Cabo Verde Compact for Water aims to increase household incomes by accelerating investment in the water and sanitation sectors and improving the management of water services. The Compact’s strategy is to reform national policymaking and regulatory institutions, and to assist with the development of a revolving loan fund that will provide access to financing for water and sanitation infrastructure projects. MCC provided an initial investment of nearly $40 million to achieve these goals and estimates that nearly 600,000 people will benefit from the program.

The Infrastructure Bank was asked by MCC and EPA to provide technical assistance to the Cabo Verdean government and was selected for the mission because of its expertise in managing and innovating in revolving loan fund programs that invest in critical infrastructure while mobilizing private sector capital. Many Cabo Verdeans also feel a special connection to Rhode Island because of the significant number of people of Cabo Verdean descent that live in the state.

This advisory visit provided technical assistance specifically on the Cabo Verde Compact II WASH (Water, Sanitation and Hygiene) Project. The WASH project implements local water utility reforms while establishing a sustainable revolving loan fund for water and sanitation infrastructure. While in Cabo Verde, Baer worked alongside Sasha Koo-Oshima, EPA Senior International Water Advisor, to advise Cabo Verdean officials on the next phases of implementation for WASH, including a review of their business plan, marketing strategy and leveraged financing plan. Baer and Koo-Oshima also visited with LuxDev, Luxembourg’s international development agency, and the Cape Verde stock exchange to discuss public/private investment opportunities for water and sanitation infrastructure. Baer highlighted Rhode Island's experience in clean energy investments in the water and wastewater infrastructure sectors and the significant cost savings that water utilities and ratepayers can achieve through clean energy investments.