WASHINGTON D.C., November 19, 2024 – The World Bank Board of Directors approved today two new projects for Argentina. The first program seeks to make public transport accessible for 5 million vulnerable users in the Buenos Aires Metropolitan Area. The second project will help improve the electricity subsidy scheme for residential users. The two projects total $1 billion in new lending.
"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," said Marianne Fay, World Bank Country Director for Argentina, Paraguay and Uruguay.
The $500 million "Support to the Sustainability and Equity of Public Transport" project will finance the social fare program, which offers a 55 percent discount on fares in 61 locations across the country where the Unique System of Electronic Ticket (SUBE) card is available. Beneficiaries of the social tariff are retirees, pensioners, and Universal Allowance (AUH) holders. The program will also support the national integrated ticket system, which provides a 50 percent discount on the first transfer and a 75 percent discount on subsequent transfers.
In addition, the project will work on optimizing bus routes to match current and evolving mobility patterns, to improve efficiency and reduce overlapping services, and will train inspectors and drivers on how to prevent and respond to sexual harassment in public transportation.
Finally, the project will also support the development of a strategy to transition the Buenos Aires Metropolitan Area’s bus fleet to low-emission vehicles and to develop contingency plans for extreme weather events.
The $500 million project "Supporting the Transition to a Sustainable Electricity Sector" will help protect low-income electricity users through subsidized tariffs and will support the improvement of the Registry of Access to Energy Subsidies (RASE) and contribute to develop new mechanisms to capture information available in other registries.
With the new project, it is expected that the subsidy scheme will be more efficient and will introduce incentives for energy efficiency, therefore reducing electricity consumption. Currently, for at least, one million users registered in the RASE, there is no socioeconomic information that can be verified.
Both projects are variable-spread loans, have a 32-year maturity period and a 7-year grace period.
