Washington DC, January 30, 2008— The World Bank approved yesterday a US$37.58 million loan to support the Sustainable Agriculture and Rural Development project in Paraguay. The project aims to improve the quality of life of small-scale farmers and indigenous communities in the departments of San Pedro and Caaguazú, in the eastern region of the country.
The initiative that will increase in agricultural productivity in these regions will also support community organization and self-governance; in order to improve natural resources management; and enhance the socio-economic condition of the population.
“The project will support small-scale farmers and indigenous communities to actively participate in the planning and implementation of sustainable agriculture and rural development activities at the farm and community levels” said Pedro Alba, World Bank Country Director for Paraguay, Argentina, Chile and Uruguay.
The project contemplates extensive social participation in planning how to use natural resources and in identifying priorities towards rural development. Expected results for the project are:
- Increase agricultural productivity of small-scale farmers through technology adaptation, diversification and production systems improvement.
- Deepen the rural roads network, including improved maintenance;
- Provide water supply and sanitation;
- Support vulnerable indigenous communities;
- Improve livestock health and husbandry management through focused infrastructure and institutional capacity building.
- Enhance the level and quality of social participation in project implementation.
“We will cover 39 municipalities in the poorest departments of the country’s Eastern Region, Caaguazú and San Pedro. We estimate that some 17,000 small-scale farmers in 600 communities and 2,000 indigenous families in 73 communities will be reached”said Gerardo Segura, World Bank Task Manager for the project.
Implemented by the Ministry of Agriculture the initiative has high standards of transparency incorporated in it. In order to guarantee the accomplishments of its objectives, the governance framework of the project emphasized institutional development of the implementation units as well as high social participation.
The loan for US$37.5 million has a 23 year maturity and a five year grace period. The Government of Paraguay will provide the remaining financing of US$3.86 million. In addition, the project will be partially blended with a GEF grant of US$4.5.million approved by GEF Council in November 2007 and scheduled to be appraised and negotiated in early 2008.