WASHINGTON D.C., November 6th 2012 – Around 47,000 farmers based in 72 municipalities in the state of Rio de Janeiro will benefit from a $100 million additional financing to the Rio de Janeiro Sustainable Rural Development Project. The loan, approved today by the World Bank Board of Directors, focuses on the North, Northwest and Serrana regions and will promote the integration and sustainable development of rural communities in the state.
"The funds will enable the expansion of the Rural Rio Program, aimed at promoting sustainable rural development, reaching 1.6 million hectares, or 36 percent of our state”, said Sergio Cabral Filho, governor of Rio de Janeiro State. “Family agriculture, typical of Rio de Janeiro, employs more than 400,000 people. Therefore it is very important that the activity counts on what is most modern in terms of sustainability.”
With an area of 43,864 square kilometers, Rio de Janeiro State has 60 percent of its land used for agricultural purposes. Agro-industrial activities represent 25 percent of the state’s gross domestic product.
When it comes to the North, Northwest and Serrana regions, the importance of agriculture is even more evident. The three areas are home to 330,000 people, more than half of the 550,000 total rural population of the state, and have 80 percent of their area used by small farmers. Altogether, they are responsible for 60 percent of agriculture employment in Rio de Janeiro.
Despite its relevance for the state’s economy, agricultural production is far from fulfilling its potential, especially in the rural areas. Problems such as deficient infrastructure, poor connections to markets, and the use of inefficient and unsustainable practices, are commonly identified as the main reasons for low productivity.
“The implementation of integrated and sustainable agricultural systems is crucial to scale-up productivity and improve the livelihoods in the region,” said Deborah L. Wetzel, Director for Brazil. “This project will support the transitions of these key rural communities to a green and efficient production system, while promoting social inclusion.”
The project is promoting these changes through the following actions:
- Creating farmer associations through capacity building and planning activities.
- Providing technical assistance and adaptive research activities for farmers.
- Offering financial incentives to increase small farmer productivity.
- Improving rural road networks.
- Promoting access to long-term financing systems.
This one tranche loan from the International Bank for Reconstruction and Development (IBRD) to the State of Rio de Janeiro is guaranteed by the Federative Republic of Brazil and has a final maturity of 24 years, with a 5 and a half year grace period.