CABEI approves US$300 million to the Republic of Honduras for the construction of the El Tablón Multipurpose Dam, Phase I

Tegucigalpa, November 14, 2024. - In an effort to mitigate recurrent flooding in the Sula Valley and surrounding areas, in the face of natural disasters caused by climate change, the Central American Bank for Economic Integration (CABEI) approved US$300 million in financing for the execution of the El Tablón Multipurpose Dam Construction Project, Stage I, for the Republic of Honduras.

The project will be carried out in the department of Santa Bárbara, in the lower basin of the Chamelecón River, and will consist of the construction of a dam that will store approximately 255 million cubic meters of water. This will allow for controlled regulation of the river's flow, reducing flooding to safeguard the lives of families and protect their homes, as well as protecting critical infrastructure for the national economy.

The Sula Valley, which covers approximately 2,400 km² in the departments of Cortés, Yoro, and Atlántida, is vital to the Honduran economy, as it is home to 90% of the maquila industry and generates around 65% of the country's Gross Domestic Product (GDP). The implementation of this project is considered crucial to preserve this area of industrial and agricultural development, in addition to boosting sustainable growth of the national economy.

The construction of the multipurpose dam will be carried out in two stages. The first stage, which is the subject of the current financing, will focus on the construction of the dam, the powerhouse and the electrical interconnection. Likewise, the Environmental and Social Management component is one of the main axes in the structure of the present financing, including investments to be developed jointly with Local Governments and an Integral Program for Sustainable Economic Development to generate economic and social opportunities that promote sustainability and improve the living conditions of the population. The second stage will include complementary works, such as irrigation systems and the supply of potable water to San Pedro Sula and other cities in the northern region, as well as complementary mitigation works downstream of the dam.

For the development of this initiative, non-reimbursable resources were provided by CABEI's Climate Change Project Preparation Fund (FCC), with the support of the European Union and Germany (KfW). This operation, supported by CABEI, is aligned with the new Institutional Strategy 2025-2029 in its strategic axes of Human Development and Social and Environmental Sustainability, which aims to improve the well-being and quality of life of the region's inhabitants.