BNDES, IDB partner up to structure rural sanitation projects

Development bank BNDES and IDB will join forces in the structuring of sanitation projects in low-income and remote areas in Brazil.

"BNDES and the Inter-American Development Bank signed a technical cooperation agreement whose main objective is to previously assess the feasibility of public-private partnership (PPP) and service concession projects of water and sanitation," BNDES said in a statement.

"With US$350,000 donated by the IDB, parametric tools will be developed that will help BNDES in the structuring process, especially in remote and less financially viable regions. The idea is to direct and expand investments to these locations, reducing the associated risks and increasing the probability of success for all those involved," it added.

The sanitation sector in Brazil has undergone a major transformation since 2020, when congress approved a regulatory change facilitating and encouraging private sector investments in a segment still dominated by state-owned companies. 

Since then, states auctioned several concessions for sanitation services, but private players concentrated on contracts for metropolitan regions.