The project for the General San Martin metropolitan area railway in Buenos Aires City will finance restoration and electrification work.

This is expected to cut travel time and cut greenhouse gas emissions. Electric railways emit 20-25% less greenhouse gases than those running on diesel fuel.

Funds will also go towards the installation of a new signaling and communications system, purchase of equipment for the connection and maintenance of the electrified system, creation of a maintenance workshop and renovation of a station.

The 76.3km-long railroad was used by 51 million passengers in 2016, making it a key part of Buenos Aires metropolitan transport system.

The total cost of the project is $522m and includes $122m in local counterpart funds to be provided by Argentina.

The IDB’s $400m loan is for a 25-year term, with a 5.5-year grace period and a LIBOR-based interest rate.