Bolivia/WB: 100,000 Farmers to Benefit from Direct Community Investments

July 21, 2011

LA PAZ, July 21st, 2011 – The World Bank's (WB) Board of Directors approved two International Development Association (IDA) no interest credits  totaling $79 million today; one worth US$40 million for the Rural Areas Community Investment Project (PICAR; its acronym in Spanish) that will benefit one hundred-thousand mostly indigenous poor farmers and another worth US$39 million for the Innovation and Agricultural Services Project (PISA; its acronym in Spanish) that will benefit three million Bolivians living in rural areas.

“The government of the Pluri-National State of Bolivia is committed to improving living standards of the rural population and the poorest agricultural producers. That is why we appreciate the support of the World Bank for these two projects, which will help poor farmers gain access to basic infrastructure such as: running water, electricity and technical assistance for their ventures. We thus believe that the execution of these two projects will become a substantial contribution to the country's rural development,” maintained Nemesia Achacollo, Minister of Rural Development and Land.

For her part, Susan Goldmark, World Bank Director for Bolivia, Ecuador, Chile, Peru and Venezuela indicated that “through PICAR, we support a mechanism of direct transfers of investment funding to rural communities, for their own management, in 51 municipalities in La Paz, Oruro, Chuquisaca and Cochabamba, departments representing the country's poorest regions.”

PICAR will develop sub-projects based upon the demands identified by the communities themselves. The majority of these initiatives will focus on increasing access to running water services in the poorest departments. Communities will be able to choose more than one sub-project, but in order to do so they will have to take the opinion of women into account when making a decision, as established in the project.  

500 rural communities (95 percent of them indigenous) will benefit from this project, which will have a total  cost of US$43 million.

The agricultural sector is one of the most dynamic in Bolivia's economy, employing 90 percent of the working population in rural areas, according to the World Bank's 2010 World Development Report, though yields are significantly lower than in neighboring countries. This reality impels the Bolivian government and the WB to boost agricultural productivity and food security.

PISA will strengthen the National Agricultural and Forestry Innovation Institute's (INIAF) capacity to undertake research, technical assistance and certified seed distribution.

Moreover, it will strengthen agricultural research programs and technical assistance for farmers, investing in the collection and conservation of genetic material and in strengthening the national seed system.

With a total cost of US$53 million, including co-financing from the governments of Bolivia, Denmark and Switzerland, this project will increase the availability of new technologies for the production of basic foods and transfer knowledge for more sustainable production systems.

“Our desire is to contribute to rural development via the transfer of knowledge and technical assistance to boost the income-generating capacity of Bolivian families depending on agricultural and forestry activities,” said Oscar A. Avalle, World Bank Resident Representative in Bolivia.

INIAF will work with universities and other research organizations to expand partnerships, benefitting more than 3.1million people in rural areas whose primary income derives from  agriculture and forestry production.

The projects are expected to last five years. They will both have a 25-year maturity period at a 1.25% interest rate, with a 5-year grace period.


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Ricardo Vargas
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Gabriela Orozco Ruíz
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