Federal Independent Agencies
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Inter-American Development Bank: 'Commodity Prices and Fiscal (Pro)Cyclicality'
WASHINGTON, Nov. 8 (TNSLrpt) -- The Inter-American Development Bank issued the following white paper in October 2025 entitled "Commodity Prices and Fiscal (Pro)Cyclicality."
Here is the introduction:
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The cyclicality of fiscal policy in Emerging Markets and Developing Economies (EMDEs) has long been a subject of intense debate in macroeconomics. Conventional wisdom, supported by extensive empirical evidence, suggests that fiscal policy in these economies is predominantly procyclical: Governments increase spending and cut taxes during expansions, exacerbating macroeconomic volatility (Kaminsky,
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WASHINGTON, Nov. 8 (TNSLrpt) -- The Inter-American Development Bank issued the following white paper in October 2025 entitled "Commodity Prices and Fiscal (Pro)Cyclicality."
Here is the introduction:
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The cyclicality of fiscal policy in Emerging Markets and Developing Economies (EMDEs) has long been a subject of intense debate in macroeconomics. Conventional wisdom, supported by extensive empirical evidence, suggests that fiscal policy in these economies is predominantly procyclical: Governments increase spending and cut taxes during expansions, exacerbating macroeconomic volatility (Kaminsky,Reinhart, and Vegh, 2004). This pattern stands in sharp contrast to standard policy recommendations that advocate for a countercyclical approach, reducing expenditures and increasing taxes during economic expansions to create fiscal space to stabilize the economy during downturns. In fact, fiscal procyclicality is widely regarded as a key stylized fact that any theory of fiscal policy in EMDEs must address. Various explanations have been proposed, including institutional weaknesses, challenges in maintaining sustainable fiscal management, and the impact of financial frictions under high sovereign risk.
In this paper, we challenge the prevailing consensus on the procyclicality of fiscal policy in EMDEs. We demonstrate that the standard empirical approach-relying on unconditional correlations between fiscal instruments and economic activity-can fundamentally misrepresent fiscal cyclicality. Unconditional correlations capture fiscal policy responses to various economic shocks but are also biased by reverse causality in the presence of fiscal shocks. Standard approaches to correct for this bias can also be problematic, as the resulting estimates do not necessarily represent a weighted average of the underlying conditional correlations. Instead, we argue that conditional correlations more accurately capture whether fiscal policy mitigates or amplifies the economy's response to shocks, making them a more appropriate basis for assessing fiscal cyclicality. To apply this approach, we focus on commodity price shocks, which are a key driver of macroeconomic fluctuations in EMDEs, and therefore provide a natural setting to analyze fiscal policy responses to external disturbances.
Measuring conditional fiscal cyclicality requires a credible identification framework to disentangle the transmission of a specific shock to the economy and the corresponding fiscal response. In our setting, this hinges on distinguishing exogenous movements in commodity prices to avoid confounding commodity shocks with changes in commodity prices driven by shifts in global economic activity or financial conditions. Indeed, other global shocks affecting commodity prices impact EMDEs' aggregate activity and fiscal policy through channels that may differ from those that characterize the transmission of commodity shocks. To identify the dynamic transmission of commodity shocks, we exploit the heterogeneous exposure of countries to changes in global commodity prices arising from geopolitical events, weather shocks, and natural disasters.
The fiscal response to commodity price shocks contrasts sharply with what unconditional correlations suggest. Unconditional correlations indicate a procyclical stance, with government spending rising alongside export prices and tax rates declining, resulting in a weak link between the primary balance and commodity price fluctuations. This aligns with the broader literature, which portrays fiscal policy in EMDEs as amplifying external shocks rather than mitigating them. However, when focusing on commodity price booms driven by commodity-specific shocks, a different picture emerges: although spending remains procyclical, tax policies are markedly countercyclical. As a result, despite higher spending, the primary balance improves, enabling EMDEs to strengthen their fiscal position during booms.2 Through a counterfactual analysis, we show that although increased spending weakens the primary balance and amplifies economic fluctuations, the rise in tax rates more than compensates for this effect. Coupled with a broader tax base, this leads to an improved fiscal balance. More importantly, the overall fiscal response dampens the impact of commodity price shocks on domestic GDP, challenging the notion that fiscal policy in EMDEs is inherently destabilizing. These findings fundamentally challenge the prevailing consensus on procyclical fiscal policy in EMDEs. They also have significant implications: Assessing policy effectiveness without accounting for the conditional nature of fiscal responses may lead to misguided recommendations. Furthermore, since theories of fiscal policy in EMDEs often assume procyclicality as a stylized fact, our results call this assumption into question.
The seminal work of Barro (1979) emphasizes tax smoothing and countercyclical debt as fundamental components of prudent fiscal policy-a perspective that has since gained widespread acceptance (see, e.g., Yared, 2019). However, these insights are typically derived from models focusing on domestic shocks (often productivity shocks) and do not account for the role of the export sector and its susceptibility to globally driven commodity price fluctuations, which are crucial factors for many EMDEs. Our evidence shows that EMDEs' fiscal response to commodity price shocks involves an increase in taxes with an improvement in the primary balance, despite the increase in spending. How does this align with the recommended optimal fiscal policy response? To address this question, we develop a small open economy (SOE) multi-good model encompassing importable, exportable, and non-tradable (MXN) goods set against the backdrop of incomplete financial markets. We consider a framework where government spending yields benefits but requires financing through a consumption tax, which induces a wedge between the (sectoral) marginal product of labor and the marginal rate of substitution between consumption and leisure.
In this setting, the optimal response to shifts in commodity prices and the country's terms of trade depends on balancing the benefits against the costs of reallocating resources over time. Following an exogenous increase in export prices, the optimal fiscal strategy involves increasing government spending at a rate lower than that of output, in line with prudent fiscal management. Since the government levies taxes on consumption, higher aggregate demand expands the tax base and improves fiscal revenues. However, the revenue boost from the expansion in aggregate demand alone is insufficient to meet future resource allocation needs. Therefore, optimal policy requires further increasing fiscal revenues by raising the tax rate despite the distortion it introduces. This decision is shaped by the interaction between tax policy and financial market frictions, which influence interest rates on private and public debt and, consequently, the intertemporal cost of consumption. Overall, this strategy reallocates the windfall from the commodity price boom towards the future. Therefore, optimal policy prescribes (conditional) procyclical government spending and countercyclical tax policy. Our analysis indicates that the optimal policy response to an export price shock aligns with our empirical findings.
We also use the model setting to demonstrate that the optimal policy can generate markedly different patterns in conditional and unconditional correlations, even within a controlled environment featuring a well-specified optimal policy. Consequently, unconditional correlations offer unreliable guidance on the appropriateness of the fiscal stance, even within our theoretical framework. Moreover, we show that the outcomes of the Ramsey optimal policy can be closely replicated by simple, implementable fiscal rules on spending and revenues, where the fiscal authority responds countercyclically and smooths debt over time.
Finally, we uncover significant heterogeneity linked to institutional quality. EMDEs with strong institutions pursue countercyclical fiscal policy during commodity booms, while those with weak institutions adopt a procyclical stance. The results for countries with high institutional quality align with our baseline findings. By contrast, in countries with lower institutional quality, both spending and spending as a proportion of GDP increase, and taxes are not raised, leading to a more muted improvement in revenues and the primary balance.
Although political economy factors may help explain divergent fiscal responses, we show that these outcomes are also consistent with optimal policy in an environment characterized by financial market frictions and production inefficiencies. In countries with weaker institutions, economic rents and borrowing constraints increase the costs of shifting resources over time, reducing the benefits of windfalls. This framework helps account for the distinct fiscal responses observed in economies with lower institutional quality.
From a policy perspective, these findings are highly consequential. They imply that commodity-exporting EMDEs do create fiscal buffers during booms. In fact, we show that the empirically observed mix of procyclical spending and countercyclical taxation is Ramseyoptimal in the context of terms-of-trade shocks and incomplete markets.
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View full text here: https://publications.iadb.org/publications/english/document/Commodity-Prices-and-Fiscal-ProCyclicality.pdf
[Category: IADB]
Inter-American Development Bank: 'A Macroprudential Theory of Foreign Reserve Accumulation'
WASHINGTON, Nov. 8 (TNSLrpt) -- The Inter-American Development Bank issued the following white paper in October 2025 entitled "A Macroprudential Theory of Foreign Reserve Accumulation."
Here is the introduction:
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Central banks' holdings of international reserves have nearly quadrupled since the wave of financial globalization of the 1990s.Yet despite an extensive literature, accounting for this surge and the large variation in reserve holdings across countries has remained elusive. In this paper, we propose a simple theory of foreign reserve accumulation based on a macroprudential motive
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WASHINGTON, Nov. 8 (TNSLrpt) -- The Inter-American Development Bank issued the following white paper in October 2025 entitled "A Macroprudential Theory of Foreign Reserve Accumulation."
Here is the introduction:
* * *
Central banks' holdings of international reserves have nearly quadrupled since the wave of financial globalization of the 1990s.Yet despite an extensive literature, accounting for this surge and the large variation in reserve holdings across countries has remained elusive. In this paper, we propose a simple theory of foreign reserve accumulation based on a macroprudential motiveand show that it can quantitatively account for the buildup of international reserves while being consistent with salient cross-sectional patterns of capital flows.
Our theory is motivated by the intertwined relationship between foreign reserves and private external debt prevalent among middle-income countries. Four facts, which we document in Section 2, guide our analysis. First, at the aggregate level, the secular increase in foreign reserves has occurred at the same time as an increase in private external debt. Second, there is a positive association between the growth of reserves and debt, both over time and across countries. Third, reserves and private external debt accumulation appear to be procyclical for most countries.
Fourth, reserve holdings are larger in economies with a more open capital account, a fact that resonates with the influential work by Ilzetzki, Reinhart and Rogoff (2019) linking the recent global accumulation of international reserves to the overall reduction in capital controls.
We argue that these facts point to a hypothesis linking international reserves to the government's prudential management of private capital flows. Few models of international capital flows, however, explicitly study the interaction between private and public capital flows. In fact, most of the literature has focused on either private or public flows, or considered a single borrowing agent without distinguishing between the two categories of flows. From an empirical point of view, distinguishing private and public capital flows has proved central to understanding key secular trends (Alfaro, Kalemli-Ozcan and Volosovych ~ , 2014). A first contribution of our paper is to provide a framework that can quantitatively speak to the evolution of private and public capital flows within a unified setup.
The environment we consider is a two-sector small open economy model with incomplete markets and inefficient private borrowing. The framework builds on a workhorse model of sudden stops and capital flows in emerging markets (e.g., Mendoza, 2002; Bianchi, 2011; Schmitt-Grohe' and Uribe, 2017). A key feature of the model is that households' private borrowing is limited by an occasionally binding credit constraint that depends on income and links the borrowing capacity to the real exchange rate. In this setup, when an adverse shock hits and the economy is highly leveraged, households hit their credit constraint and become unable to smooth consumption. The contraction in spending leads to a depreciation of the real exchange rate, which further tightens the borrowing constraint and leads to a "sudden stop" in capital inflows. Our key departure from the literature is to allow for the accumulation of a non-state contingent asset, which we refer to as international reserves, and to examine the implications for gross capital flows and optimal policy.
We show that while reserves provide a liquidity buffer to mitigate the contraction of consumption in a crisis, households do not internalize their general equilibrium benefits. Moreover, we demonstrate that the constrained-efficient allocation (i.e., the allocations that would prevail if the government were to make all financial decisions on behalf of private agents) can be implemented via a government reserve policy. When households deleverage, they fail to internalize how the contraction in their spending leads to a real exchange rate depreciation, further tightening economy-wide borrowing constraints. As a result, they do not face proper incentives to accumulate reserves in good times, when the credit constraint is not binding. A contribution of our paper is then to provide a theory of why it is the government rather than the private sector that must accumulate reserves.
Under Ricardian equivalence, reserve accumulation would be neutral as households would simply borrow more to offset the increase in reserve holdings by the government (Barro, 1974).
When households' borrowing constraint is not binding, a small accumulation of international reserves by the government is indeed neutral. However, once the government accumulates a large enough amount of reserves, households become borrowing constrained and are unable to offset the government's reserve accumulation, thus breaking Ricardian equivalence. Hence, the very same credit constraint that makes households overborrow in good times, relative to the constrained-efficient allocation, also makes reserve accumulation by the government effective.
While gross debt increases under this government policy, the economy's net foreign asset position improves, leading to a reduction in the frequency and severity of sudden stops relative to the laissez-faire outcome.1
A quantitative analysis of the model shows that the macroprudential motive for reserves can go a long way towards accounting for the intertwined relationship between private and public capital flows observed in the data. In particular, model simulations can account for the four aforementioned facts. The model generates i) the observed upward trend in reserves and debt, ii) the positive association between yearly increases in reserves and debt in the cross-section, iii) the procyclicality of debt and reserves over the business cycle, and iv) the positive correlation between the degree of financial liberalization and reserves across countries.
Literature: Our paper adds to the extensive literature on capital controls and reserve accumulation by showing how an overborrowing externality provides a rationale for both policies. We demonstrate that, despite working through different channels, capital controls and reserve accumulation can ultimately result in equivalent welfare outcomes.
The idea of a precautionary motive for reserves has a long tradition in international macroeconomics (Kenen and Yudin, 1965; Heller, 1966, Clower and Lipsey, 1968; Clark, 1970; and Kelly, 1970). More recently, precautionary theories of reserves have focused on shocks to income or shocks to countries' access to credit markets, but in the context of models with a single decision-maker controlling all external financial decisions.2 This literature has hence remained silent on the question of why it is the government that has to accumulate reserves. Our paper tackles this question and underscores an externality explaining why private agents may not have incentives to accumulate reserves on their own.
Few papers jointly model private and public capital flows in quantitative settings. A notable exception is Benigno, Fornaro and Wolf (2022), who consider a model in which reserves held by the government are motivated by the presence of a learning-by-doing externality in the tradable sector. They show that in the absence of industrial policies, accumulating reserves is desirable to undervalue the real exchange rate and foster export-led growth. Our work is complementary in that it articulates a motive for reserve accumulation based on a macroprudential motive. Moreover, we examine optimal policy and show that the macroprudential motive can go a long way towards accounting for the observed levels of reserves and the interaction between private and public capital flows.
Our paper also relates to the literature that studies foreign exchange (FX) interventions in the presence of limits to international arbitrage. Examples include Cavallino (2019), who shows how FX interventions can deal with dynamic terms of trade externalities and capital account shocks, Amador, Bianchi, Bocola and Perri (2020), who show that reserve accumulation is needed to implement exchange rate policies at the zero lower bound, and Fanelli and Straub (2020), who characterize optimal policies when real exchange rate fluctuations lead to distributional consequences. While a common theme in these papers is that international intermediaries have limited leverage capacity, building on the work of Gabaix and Maggiori (2015), our focus is instead on frictions in domestic financial markets.3
In addition, a key distinction of our paper is that we study the scope for reserve accumulation owing to financial stability, a motive notably raised by Calvo (2006) and Obstfeld, Shambaugh and Taylor (2010). In this respect, our paper is complementary to Bocola and Lorenzoni (2020), who show that reserves can enhance the credibility of lender of last resort policies. Basu, Boz, Gopinath, Roch and Unsal (2020) also study capital controls and FX interventions within a unified framework. In their model, the rationale for capital controls is an overborrowing externality while the rationale for FX interventions is to reduce borrowing costs and improve risk-sharing.4
In contrast, we show how an overborrowing externality generates a rationale for both FX interventions and capital controls.
Our paper also relates to the literature on financial crises and macroprudential policy. This literature has shown how capital controls can correct pecuniary externalities that generate excessive systemic risk (e.g., Lorenzoni, 2008; Bianchi, 2011; Davila and Korinek ' , 2017; Bianchi and Mendoza, 2018; Jeanne and Korinek, 2018).5 We contribute to this literature by showing how international reserves can serve as a macroprudential policy tool. Our results shed light on the observation by Ilzetzki, Reinhart and Rogoff (2019) of a rise in global reserves alongside increasing capital mobility.
Our work also connects with several studies that analyze the interaction between ex-ante and ex-post policies. The two most closely related ones are Benigno, Chen, Otrok, Rebucci and Young (2013) and Schmitt-Grohe and Uribe ' (2021).6
In Benigno et al. (2013), the government has access to a richer set of tax instruments, enabling it to relax borrowing constraints ex-post, which results in more borrowing ex-ante compared to the laissez-faire economy. In SchmittGrohe and Uribe ' (2021), the optimal government intervention induces more borrowing relative to competitive equilibria driven by self-fulfilling pessimistic beliefs. In contrast to these studies, our model distinguishes between private and official flows. While we also find that under the optimal intervention, households borrow more, the accumulation of reserves ultimately improves the net foreign asset position.
Finally, our paper is related to a large empirical literature on capital flows. Particularly relevant is the empirical work on the precautionary motive for reserves (e.g., Edwards, 1983; Frankel and Saravelos, 2012; Bussiere, Cheng, Chinn and Lisack, 2013; Calvo, Izquierdo and Loo-Kung, 2013).
Our empirical and theoretical analysis emphasizes the interaction between private and public capital flows and the importance of considering gross positions, as stressed in Obstfeld (2012).
The paper is organized as follows. Section 2 outlines the motivating facts. Section 3 presents the model and the theoretical results. Section 4 contains a quantitative analysis, and Section 5 concludes.
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View full text here: https://publications.iadb.org/publications/english/document/A-Macroprudential-Theory-of-Foreign-Reserve-Accumulation.pdf
[Category: IADB]
IDB, Denmark, Norway, and Sweden to Unlock $800 Million for Amazonia and Central America
WASHINGTON, Nov. 8 -- The Inter-American Development Bank issued the following news release:
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IDB, Denmark, Norway, and Sweden to Unlock $800 Million for Amazonia and Central America
BELEM, Brazil -- The Inter-American Development Bank (IDB), Impact Fund Denmark, the Norwegian Agency for Development Cooperation (Norad), and the Swedish International Development Cooperation Agency (Sida) signed a letter of intent today toward establishing a new guarantee. This new partnership is expected to result in approximately $800 million in additional IDB lending capacity for clean-energy projects
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WASHINGTON, Nov. 8 -- The Inter-American Development Bank issued the following news release:
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IDB, Denmark, Norway, and Sweden to Unlock $800 Million for Amazonia and Central America
BELEM, Brazil -- The Inter-American Development Bank (IDB), Impact Fund Denmark, the Norwegian Agency for Development Cooperation (Norad), and the Swedish International Development Cooperation Agency (Sida) signed a letter of intent today toward establishing a new guarantee. This new partnership is expected to result in approximately $800 million in additional IDB lending capacity for clean-energy projectsunder the Amazonia Forever and America en el Centro regional programs.
This additional capacity will enable the IDB to scale investments across the Amazon region and Central America by supporting projects that expand energy access, modernize transmission and distribution networks, promote clean electricity systems, advance sustainable transport, scale clean cooking solutions, increase energy-storage capacity, and strengthen emerging clean technology sectors.
The IDB has a strong track record of risk-transfer guarantees. In 2021, a $100 million transaction with Sida unlocked funding for projects focused on poverty alleviation, climate resilience, and support women in Bolivia, Colombia, and Guatemala, followed in 2024 by a second $250 million guarantee with Sida that unlocked $469 million in additional lending for the Amazon region under Amazonia Forever.
The proposed new guarantee - now with Impact Fund Denmark, Norad, and Sida - is expected to further bolster the IDB's regional programs, deepen collaboration with Denmark, Norway, and Sweden, and advance the IDB Group's Institutional Strategy by mobilizing additional resources through balance-sheet optimization and innovative risk-sharing with partners.
"We are glad to work closely with Sida, Impact Fund Denmark, and Norad towards a new credit-substitution guarantee - our third with Sida and our first with Impact Fund Denmark and Norad. Through innovative financing, we are facilitating the mobilization of financial resources to strengthen energy security, resilience, and inclusive growth in Amazonia and Central America," said IDB Group President Ilan Goldfajn.
"Guarantees are powerful catalysts for climate action. By partnering with the IDB, Denmark, Norway, and Sweden are unlocking approximately 800 million dollars for clean energy and sustainable development in the Amazon region. This collaboration shows how innovative financial risk-sharing models can accelerate green investments where they matter most--protecting biodiversity and supporting communities for generations to come," said CEO at Impact Fund Denmark Lars Bo Bertram.
"We are proud to announce the first guarantee under the Norwegian Sovereign Guarantee Scheme, and it is especially rewarding to do so together with Sweden and Denmark. The Amazon region - where Norway has been the most important partner for rainforest conservation during the last 15 years - is extremely energy-poor. This guarantee will address that by enabling close to $800 million in renewable investments, with significant positive effects for the people, environment, and economic development," said Jonas Gahr Store, Prime Minister of Norway.
"This partnership with the IDB demonstrates how innovative financial instruments can multiply development impact. By combining Sweden's, Norway's, and Denmark's guarantee mechanisms, we are helping to unlock substantial new lending capacity for sustainable investments in the Amazon, aligning financing with both climate and development goals," said Assistant Director General and Head of the Department for Trade, the Private Sector, and Financial Instruments at Sida, Kjell Forsberg.
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The IDB Group at COP30
The IDB Group is hosting more than 80 events at COP30 to showcase solutions for closing gaps in financing for resilient development through partnerships, innovation, and a focus on measurable impact in Latin America and the Caribbean. Journalists on site are invited to visit our venues, with no registration required: IDB Group Pavilion in the Blue Zone, IDB Group Pavilion in the Green Zone, and the AMAZONIA SEMPRE Station at the Goeldi Museum. Follow our COP30 page for all news and event schedules.
The IDB Group is acting as a bridge at the conference - connecting governments and investors, the public and private sectors, people and communities - to mobilize at least $6 billion in announcements to help close gaps in financing and support national priorities.
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About Amazonia Forever
Amazonia Forever is the IDB Group's regional coordination program that aims to protect biodiversity and accelerate sustainable development through three lines of action: expanding innovative financing, boosting knowledge exchange, and facilitating regional coordination among the eight countries that the Amazon encompasses. During COP30, it will host the AMAZONIA SEMPRE Station at the Goeldi Museum from November 8 to 21. See the full program here: www.bit.ly/COP30AMAZONIASEMPRE
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About America en el Centro
America en el Centro is a regional development program designed as an umbrella to address common and cross-border challenges faced by countries in Central America, Panama and the Dominican Republic (CAPDR). The initiative seeks to unlock the region's potential, promote sustainable development, and foster resilience.
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About the IDB
The Inter-American Development Bank (IDB), a member of the IDB Group, is devoted to improving lives across Latin America and the Caribbean. Founded in 1959, the Bank works with the region's public sector to design and enable impactful, innovative solutions for sustainable and inclusive development. Leveraging financing, technical expertise, and knowledge, it promotes growth and well-being in 26 countries. Visit our website: www.iadb.org/en.
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Original text here: https://www.iadb.org/en/news/idb-denmark-norway-and-sweden-unlock-800-million-amazonia-and-central-america
Uruguay to Improve Secondary Education With IDB Support
WASHINGTON, Nov. 7 -- The Inter-American Development Bank issued the following news release:
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Uruguay to Improve Secondary Education with IDB Support
The Inter-American Development Bank (IDB) is lending $60 million to help Uruguay enhance access and quality in its secondary education system. This operation is the third under a Conditional Credit Line for Investment Projects approved in 2016 to finance a broader program of educational support for secondary students.
The new loan aims to lower drop-out rates and the share of students who repeat grades. The program, focusing on students in
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WASHINGTON, Nov. 7 -- The Inter-American Development Bank issued the following news release:
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Uruguay to Improve Secondary Education with IDB Support
The Inter-American Development Bank (IDB) is lending $60 million to help Uruguay enhance access and quality in its secondary education system. This operation is the third under a Conditional Credit Line for Investment Projects approved in 2016 to finance a broader program of educational support for secondary students.
The new loan aims to lower drop-out rates and the share of students who repeat grades. The program, focusing on students inthe most vulnerable situations, will also expand an educational model that extends school hours to provide more learning opportunities and reinforce student-school ties.
The program will counteract high absenteeism rates, which are more acute in vulnerable contexts. It will implement a tutoring plan for first-time scholarship students to support their transition and overcome learning gaps, focusing on the knowledge they need to continue progressing through their education. In pursuing this objective, the program will also strengthen information systems and attendance records by deploying better technological tools.
The program will directly benefit students in vulnerable situations with 60,000 scholarships and social and educational orientation activities. It will grant an additional 35,000 students the opportunity to attend extended school day centers.
The IDB loan has a 22.5-year repayment term, an 8-year grace period, and an interest rate based on the Secured Overnight Financing Rate (SOFR).
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About the IDB
The Inter-American Development Bank (IDB), a member of the IDB Group, is devoted to improving lives across Latin America and the Caribbean. Founded in 1959, the Bank works with the region's public sector to design and enable impactful, innovative solutions for sustainable and inclusive development. Leveraging financing, technical expertise, and knowledge, it promotes growth and well-being in 26 countries. Visit our website: www.iadb.org/en.
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Original text here: https://www.iadb.org/en/news/uruguay-improve-secondary-education-idb-support
IDB Supports Reducing Flood Vulnerability in Metropolitan Area of San Salvador
WASHINGTON, Nov. 7 -- The Inter-American Development Bank issued the following news release:
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IDB Supports Reducing Flood Vulnerability in Metropolitan Area of San Salvador
The Executive Board of the Inter-American Development Bank (IDB) has approved a Conditional Credit Line for Investment Projects (CCLIP) of up to $500 million, aimed at reducing the vulnerability of El Salvador's population to flooding.
As part of this credit line, the Board also approved an initial individual loan of $150 million to finance a project focused on the Metropolitan Area of San Salvador (AMSS).
The AMSS
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WASHINGTON, Nov. 7 -- The Inter-American Development Bank issued the following news release:
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IDB Supports Reducing Flood Vulnerability in Metropolitan Area of San Salvador
The Executive Board of the Inter-American Development Bank (IDB) has approved a Conditional Credit Line for Investment Projects (CCLIP) of up to $500 million, aimed at reducing the vulnerability of El Salvador's population to flooding.
As part of this credit line, the Board also approved an initial individual loan of $150 million to finance a project focused on the Metropolitan Area of San Salvador (AMSS).
The AMSSpopulation faces high vulnerability to increasingly frequent and intense flood events that cause loss of life, significant economic damage, and disruptions to daily activities. The project financed by the first loan will address the main causes of this vulnerability, including gaps in access to adequate urban drainage services, challenges in planning and strengthening technical capacities for efficient management, the need to improve early-warning systems, and limitations in the proper disposal of solid waste within drainage systems.
The program will fund the development and maintenance of urban drainage infrastructure, including the construction of detention ponds and the rehabilitation and operation of sustainable urban drainage systems. It will also support the rehabilitation of vaults designed to store large volumes of rainwater during intense storms and release it in a controlled manner, as well as the recovery and strengthening of culverts.
This project will directly benefit about 5,100 households (15,200 people) and approximately 700 establishments (businesses, public institutions), which will have access to adequate urban drainage.
Additionally, 100% of the AMSS population will benefit from an improved early warning system and awareness campaigns. Likewise, 70% of the personnel participating in the planned workshops will obtain certifications in urban drainage management and early warning systems.
The project also includes institutional strengthening of the Ministry of Public Works and Transportation and improving the effectiveness of the flood early warning system.
The first individual loan of $150 million has a repayment term of 23 years, a grace period of 7.5 years, and an interest rate based on SOFR
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About the IDB
The Inter-American Development Bank (IDB), a member of the IDB Group, is devoted to improving lives across Latin America and the Caribbean. Founded in 1959, the Bank works with the region's public sector to design and enable impactful, innovative solutions for sustainable and inclusive development. Leveraging financing, technical expertise, and knowledge, it promotes growth and well-being in 26 countries. Visit our website: www.iadb.org
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Original text here: https://www.iadb.org/en/news/idb-supports-reducing-flood-vulnerability-metropolitan-area-san-salvador
ICYMI: Trump EPA Finalizes Approval of North Dakota's Coal Combustion Residuals Permit Program, Advances Cooperative Federalism
WASHINGTON, Nov. 7 -- The Environmental Protection Agency issued the following news release:
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ICYMI: Trump EPA Finalizes Approval of North Dakota's Coal Combustion Residuals Permit Program, Advances Cooperative Federalism
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WASHINGTON - On Wednesday, U.S. Environmental Protection Agency (EPA) Administrator Lee Zeldin, alongside North Dakota Governor Kelly Armstrong at the North Dakota state Capitol, approved North Dakota's coal combustion residuals (CCR) program application. This program allows the state, rather than the federal government, to permit CCR disposal in surface impoundments
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WASHINGTON, Nov. 7 -- The Environmental Protection Agency issued the following news release:
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ICYMI: Trump EPA Finalizes Approval of North Dakota's Coal Combustion Residuals Permit Program, Advances Cooperative Federalism
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WASHINGTON - On Wednesday, U.S. Environmental Protection Agency (EPA) Administrator Lee Zeldin, alongside North Dakota Governor Kelly Armstrong at the North Dakota state Capitol, approved North Dakota's coal combustion residuals (CCR) program application. This program allows the state, rather than the federal government, to permit CCR disposal in surface impoundmentsand landfills, and ensures EPA's commitment to advancing cooperative federalism with state, local and Tribal partners. EPA will continue working with these partners to prioritize timely action and empower those with local expertise to oversee more effective CCR disposal operations.
Read coverage below on EPA's action to advance cooperative federalism.
North Dakota Monitor: EPA puts coal waste regulation into North Dakota's hands Exit EPA's website
"... Zeldin said the move helps cut red tape and puts more decision-making in the hands of the state, where it belongs... 'States should be more in charge of their own destiny,' Zeldin said."
KX News: Gov. Armstrong and EPA administrator Lee Zeldin finalize agreement to implement coal program Exit EPA's website
"... The Coal Combustion Residuals (CCR) Permit Program intends to make the recycling of coal ash safer and more efficient, while helping to reduce costs for coal producers. The program will allow the state, rather than the federal government, to permit CCR disposal."
Inside EPA: EPA Approves North Dakota's CCR Program, Boosting Push For Other States Exit EPA's website
"... Zeldin also responded to a question regarding EPA's future involvement in North Dakota's CCR permitting, saying that the agency will 'be a very close and trusted partner with the state,' but that 'what North Dakota is gaining primacy over, as far as that regulatory oversight, is substantial.'"
Bismarck Tribune: EPA gives North Dakota authority over coal waste; environmental groups may challenge Exit EPA's website
"Federal officials are handing off authority of many coal waste regulations to a North Dakota state agency. The move has been long sought by the state..."
WDAY Radio: EPA approves North Dakota's coal combustion residuals program Exit EPA's website
"... 'By entrusting state experts with the authority to oversee their own resources, we are reinforcing our commitment to both cooperative federalism and permitting reform,' EPA Administrator Lee Zeldin said."
American Ag Network: Fedorchak joins EPA Administrator Lee Zeldin and Governor Kelly Armstrong for approval of North Dakota Coal Combustion Residuals Permit Program Exit EPA's website
"... 'EPA is proud to support North Dakota's leadership and local expertise in managing its own coal combustion residuals program responsibly,' said EPA Regional Administrator Cyrus Western. 'This approval reflects that practical, state-driven solutions can deliver both environmental results and American energy opportunity.'"
Lignite Energy Council: Lignite Energy Council Applauds EPA Approval of North Dakota's Coal Combustion Residuals Program Exit EPA's website
"... Administrator Zeldin's decision to make this announcement in North Dakota highlights the importance of coal country to the nation's energy future. His visit underscores the state's record of balancing strong environmental performance with the reliable, affordable energy that keeps homes, businesses, and industries powered."
WZFG The Flag: EPA approves North Dakota's coal combustion residuals program Exit EPA's website
"... 'North Dakota has regulated coal combustion residuals effectively for more than 40 years, protecting both the environment and public health, and we appreciate the EPA and Administrator Zeldin for recognizing the strength and responsibility of our state-led approach,' North Dakota Governor Kelly Armstrong said."
E&E News: EPA hands North Dakota oversight of coal ash dumps Exit EPA's website
"...The approval is the latest sign of EPA blazing forward with Trump administration priorities during the government shutdown..."
KFYR TV (VIDEO): EPA Administrator Lee Zeldin in Bismarck to approve of ND authority to regulate coal ash waste Exit EPA's website
"EPA Administrator Lee Zeldin came from Washington to make the announcement with Governor Armstrong in Bismarck... Zeldin says North Dakota's department of environmental quality can take over [the coal combustion residuals program]..."
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Original text here: https://www.epa.gov/newsreleases/icymi-trump-epa-finalizes-approval-north-dakotas-coal-combustion-residuals-permit
EPA Issues Additional Decisions on Small Refinery Exemptions
WASHINGTON, Nov. 7 -- The Environmental Protection Agency issued the following news release:
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EPA Issues Additional Decisions on Small Refinery Exemptions
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Agency Continues Work to Get Renewable Fuel Standard Program Back on Track
WASHINGTON U.S. Environmental Protection Agency (EPA) is delivering on President Trump's promise to restore America's energy dominance by continuing to process Small Refinery Exemption (SRE) petitions. Today, the agency is acting on 16 individual SRE petitions from eight refineries seeking an exemption from their Renewable Fuel Standard (RFS) obligations for
... Show Full Article
WASHINGTON, Nov. 7 -- The Environmental Protection Agency issued the following news release:
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EPA Issues Additional Decisions on Small Refinery Exemptions
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Agency Continues Work to Get Renewable Fuel Standard Program Back on Track
WASHINGTON U.S. Environmental Protection Agency (EPA) is delivering on President Trump's promise to restore America's energy dominance by continuing to process Small Refinery Exemption (SRE) petitions. Today, the agency is acting on 16 individual SRE petitions from eight refineries seeking an exemption from their Renewable Fuel Standard (RFS) obligations forcompliance years 2021-2024. In consultation with the Department of Energy (DOE), EPA reviewed and considered information submitted by each petitioning small refinery. EPA then evaluated each SRE petition consistent with the Clean Air Act and case law. After carefully reviewing all information, EPA is granting full exemptions to two petitions, granting partial exemptions to 12 petitions, and denying two petitions. Concurrent with issuing these decisions, EPA is updating the SRE website to reflect these decisions on the 16 small refineries.
Today's announcement is part of the Trump EPA's commitment to get the RFS program back on track with an approach that recognizes some small refineries are impacted more significantly than others and that EPA's relief should reflect those differences. It also builds upon the agency's decisions made on August 22, 2025, for 175 individual SRE petitions from 38 refineries. Consistent with our August Decisions Action, EPA is reaffirming the agency's policy of returning RFS compliance credits, known as Renewable Identification Numbers (RINs), previously retired for compliance when a small refinery receives an exemption for a prior compliance year. While no actual RINs will be returned today, EPA will follow standard agency policy and instruct those impacted to contact the EPA Fuels Program Helpdesk to initiate the RINs return process.
With most of the old petitions now cleared, EPA is committed to working with DOE to address new petitions as quickly as possible and within the 90-day statutory review period, a stark contrast from the Biden-Harris Administration which did not act on a single one.
Furthermore, on September 16, 2025, the agency announced a supplemental notice of proposed rulemaking (SNPRM) that takes into consideration the expected impacts of the August 22, 2025, SRE decisions. EPA is reviewing comments on the supplemental proposed rule as the agency continues to work on final regulations for the "Set 2" rule. As stated in the SNPRM, EPA intends to update the agency's projections of exempted gasoline and diesel volumes in the final rule based on any additional SREs issued after the proposal, including the petition decisions in this action.
Please see EPA's RFS program website for more information.
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Original text here: https://www.epa.gov/newsreleases/epa-issues-additional-decisions-small-refinery-exemptions
