World Bank will loan US$ 70.3 million
Improved sanitation, less pollution and more agriculture revenue.
WASHINGTON, January 26, 2012 – Thousands of people in urban and rural areas of the state of Sergipe will have access to improved water services through the Sergipe Water Project, thanks to a World Bank loan for US$70.3 millions announced today.
The project will increase access to safe water and sanitation in the most populous basin in the State, as well as reduce pollution, promote more efficient irrigated agriculture and improve Sergipe’s ability to have a more integrated water management and a more resilient water sector.
The State of Sergipe, in Brazil’s poor Northeastern region, is representative of many of the country’s water challenges. Basic water supply and sanitation services struggle to keep pace with economic and population growth and urbanization; and pollution aggravates the region’s drought-linked urban and agricultural water scarcity problems. Some 237,000 people lack in-house access to drinking water, and 514,000 do not have proper sanitation in the State.
“Access to water supply and sanitation is essential to improving people's lives, preserving the environment and preparing our cities for the future generations. Increasing the efficiency of water use will boost Sergipe’s growth prospects and ensure the basic conditions for quality of life both in the urban and rural in the future,” said Marcelo Déda, Governor of Sergipe.
The Sergipe river basin, where the project will focus its activities, is the most polluted of the State and home of more than half of Sergipe’s two million inhabitants, including the capital, Aracajú. It has a 65 percent water supply deficit, with a demand for 260,000 daily cubic meters of water and a supply of only 87,000. The shortfall is covered by expensive transfers from distant basins.
“Sergipe is taking a bold step to integrate the management of all its water issues, from sanitation and access to safe water to irrigation in the rural area, from pollution control to water and climate related risks management. This will result in significant social, health and economic benefits for the State,” said Makhtar Diop, World Bank Country Director for Brazil. “Water issues have traditionally been managed in isolation in Brazil, so Sergipe’s example could have an important demonstration effect for other states, especially in the water-scarce Northeastern region.”
Some of the main goals and activities of the project until 2015 include:
- Increasing the number of household sanitation connections by at least 88,000 in the target cities along the Sergipe river basin, reaching 143,000 connections and directly benefiting approximately 500,000 people;
- Improving the efficiency of water use in irrigation by at least 20 percent in key perimeters of the Sergipe basin, totaling 1,150 hectares and benefiting some 1,000 families. This includes the adoption of improved water quality and soil conservation practices by at least 60 percent of the farms;
- Reducing by at least 5,620 tons the yearly wastewater discharges of biochemical oxygen demand pollutants (BOD);
- Creating and strengthening an agency responsible for statewide water resources management; and
- Creating and expanding environment conservation areas by a total of 2,400 hectares, to protect water resources and biodiversity along the Sergipe basin (by 2017).
The World Bank’s Partnership Strategy with Brazil for the 2012 to 2015 period calls for a focus on investments in the Northeastern region, Brazil’s poorest. Since 1977, the Bank has financed approximately US$ 1.5 billion for development projects in Sergipe, including today’s loan. Water resources management and sanitation are a priority for the Bank’s work in Brazil, with investments of over US$ 5 billion.
This US dollar denominated, commitment-linked IBRD flexible loan has a fixed spread, a 5 year grace period and 25 year final maturity with all conversion options.