Funding boost for Peruvian construction sector

International Finance Corporation (IFC) and Japan International Cooperation Agency (JICA) have provided the final tranche of a US$400m financing package to global finance group BBVA in Peru with the objective to promote sustainable construction and energy efficiency projects in the country. The first part of the financing, carried out in June 2023 by IFC, was for US$150m. 

The financing package from IFC and JICA will allow BBVA to strengthen its loan portfolio for sustainable construction in the country. The package includes advisory services to provide technical support to real estate developers in EDGE and LEED certifications for residential, industrial and commercial buildings. The financing will also be used to develop energy efficiency projects. In addition, IFC will support BBVA on environmental, social and governance (ESG) guidelines. 

Alfonso García Mora, IFC vice president for Europe, Latin America and the Caribbean, said: “The sustainable construction sector is still underdeveloped in Peru. In addition to being a strong step in the right direction, this financing aspires to be part of a series of ongoing efforts aimed at ensuring that sustainability is the norm in the construction industry of the Peruvian nation.”

Over the next decade, IFC estimates that green buildings will represent a significant low-carbon investment opportunity in emerging markets: US$24.7trn by 2030. Emerging market cities are expanding at a rapid pace to keep up with high population growth and rapid urbanisation with the floor area of buildings expected to double by 2060. Most of this growth will occur in residential construction, especially in middle-income countries.