WASHINGTON, November 21, 2013 – Millions of people facing poverty in Brazil’s northeastern Ceará State will benefit from actions to increase workers’ professional training, improve family assistance programs and enhance water quality. The World Bank Board of Directors approved today a US$ 350 million loan as part of the Ceará Strengthening Service Delivery Program for Results (PforR)
This new World Bank instrument, implemented in Brazil for the first time, will link disbursements to the achievement of pre-established development results on the ground. PforR financing helps governments improve the design and implementation of their development programs and achieve lasting results by strengthening institutions and building capacity.
Since the early 1990’s, the State of Ceará has been undertaking reforms to promote results-based management, economic growth and social inclusion. In these years, a large number of infrastructure investments were undertaken to boost the State’s capacity to deliver these outcomes, with the support of the World Bank. The new program will help to build on earlier efforts in health and education, as well as improve water quality and sanitation management, which have been affected by severe drought in the state.
“The World Bank has been a great partner of the State of Ceará in promoting productive social inclusion,” said Cid Gomes, Governor of the State of Ceará. “This new program will target areas that are fundamental to sustain economic growth and especially that affect people living in poverty. It includes particular actions to include the poor and vulnerable into Ceará’s growing economy.”
With a per capita income of US$ 5,236, below the average for Brazil’s states, Ceará faces difficult challenges. Thirteen percent of its 7.4 million inhabitants live in extreme poverty and 36.9 percent in poverty. The State also lacks significant private sector investments in part due to a shortage of skilled professionals.
In addition, Ceará is one of Brazil’s driest states and experiences chronic water scarcity, with a direct negative effect on agricultural production and social welfare. The current drought is the worst in 50 years. Water and sanitation are critical issues given that only 75 percent of the population lives in households connected to the public water system and 35 percent to the sewerage system.
“The World Bank has a decades long partnership with Ceará,” said Deborah L. Wetzel, World Bank Director for Brazil. “Ceará’s progress in implementing ambitious multi-sector reforms makes the State a great counterpart to introduce the PforR instrument to Brazil. This is the perfect instrument to address Ceará’s on-going development challenges, to help the State further strengthen its institutions and to achieve its goals of reducing poverty and sharing prosperity.”
The Program includes a US$ 35 million technical assistance component that will provide support for cross-cutting public sector management functions.
The main results to be achieved by the Program are:
- Improve the effectiveness and quality of the education program by training preschool unit care takers and school principals of 36 municipalities;
- Increase the number of schools in operation from 74 to 140 by 2015;
- Improve professional training capacity by constructing 8 new training schools by 2015 and supporting the maintenance of the 97 professional education ones already in operation and the 35 under construction;
- Support the expansion of the family welfare program through the social assistance centers from the 170 co-financed by the State and Federal Governments today to all 369 existing in the State;
- Develop the legal and institutional framework for water management in the State of Ceará, including mechanisms for participatory watershed management;
- Help achieve the classification of Ceará’s strategic reservoirs by use and water quality objective;
- Connect an additional 14,628 households to the sewage network.
This loan from the International Bank for Reconstruction and Development (IBRD) to the State of Ceará is guaranteed by the Federative Republic of Brazil and has a final maturity of 25 years, with a 5 year grace period.