Uruguay secures CAF loan for dam construction
CAF’s Sergio Díaz-Granados praised Uruguay’s stability
Uruguay’s state-owned water company, OSE, has secured a US$130 million loan from the CAF-Development Bank of Latin America and the Caribbean to finance the construction of the Casupá dam, a strategic project to guarantee the supply of drinking water for Montevideo’s metropolitan area until 2045.
The loan consists of US$110 million for construction and US$20 million for land expropriations.
The tender process for construction is scheduled to begin in early 2026, with construction starting in early 2027. The dam is expected to be completed by mid-2029.
The Casupá dam will be Uruguay’s largest, with a storage capacity of 118 million cubic meters of water.
In addition to the loan, CAF will provide US$160,000 in non-reimbursable funds for technical studies and to help OSE prepare the tender documents.
OSE President Pablo Ferreri highlighted CAF as a key partner, noting that the bank will also provide an additional US$63 million for the company’s technological modernization, including the use of AI in water management.
It is the raw freshwater reserve needed by the metropolitan area to ensure the supply of drinking water by 2045, Ferreri explained. This is a strategic project that, together with others, will allow us to fulfill this very important task, which is a mandate from the president of the Republic, he added.
The project is a direct response to the challenges of population growth and climate change, which led to a severe drought in 2023.
CAF’s executive president, Sergio Díaz-Granados, praised Uruguay’s stability and emphasized that the loan is part of the bank’s commitment to green projects.
Ties between OSE and CAF go beyond the Casupá project, encompassing other endeavors within the public company’s investment plan. The bank will also assist Uruguay in government-sponsored initiatives on housing, children, and youth, among other areas.
