WB/Brazil: Over 5 million Pernambuco residents to benefit from growth and social inclusion program

March 22, 2012

Actions will improve education quality, promote job opportunities, increase water security and strengthen public management policies

WASHINGTON – March 22, 2012 – The World Bank Board of Directors approved today a US$ 500 million Development Policy Loan (DPL) to support public policies promoting social and economic development in the State of Pernambuco, in Brazil’s poor Northeastern region. The Expanding Opportunities , Enhancing Equity Program will promote a range of actions in order to improve education, promote job opportunities, strengthen the state’s infrastructure and public administration management, benefiting around 5,2 million people that live outside the Recife Metropolitan Area.

“We want improve the quality of life of the population who live outside the Recife Metropolitan Area, thus reducing inequity and poverty in the State,” says Eduardo Campos, Governor of Pernambuco. “This will be achieved through a wide package of measures that go from investments in education to public management reforms.”

The tenth largest economy in Brazil, the State of Pernambuco is marked by historical social gaps, reflected in its below-average social and economic indicators. Although it has begun a new growth period in the last decade, the state still has huge problems to be addressed.

Water scarcity and sanitation are major concerns in Pernambuco, one of the driest states of Brazil. Of the 172 municipalities served by the Pernambuco State Water Supply, only 30 receive water 24 hours a day. Rationing is common practice even in the Metropolitan Area of Recife.

Education coverage is very deficient in the rural areas, and gender inequity is also large in the State, with women representing only 44.3% of the labor force, even though they have higher levels of education.

“This program will be a turning point for Pernambuco’s growth. Investing in education will generate a better work force in the future, creating more opportunities for both men and women,” said Makhtar Diop, World Bank Director for Brazil. “Addressing issues like water scarcity and sanitation will improve health standards and reduce avoidable deaths, such as those due to water borne diseases.”

The loan supports reforms with the following actions:

  • Expand the number of hours in secondary schools, with an emphasis on schools in the interior of the State;
  • Strengthen the institutional and regulatory framework for the management of the scarce water resources in the State;
  • Improve the policies for natural disaster response, particularly in poor and vulnerable communities, which are disproportionately affected by them;
  • Provide vocational training, focused on local market demands in order to promote job creation;
  • Promote gender mainstreaming in public administration by elevating the Women’s Secretariat to a permanent status;
  • Support micro, small and medium size enterprises through the provision of credit, technical assistance and business development;
  • Increase revenue in the State to provide greater support to policies and programs for equity through mechanisms to facilitate tax collection; and
  • Promote result-based management through a management institute for continuous learning and training of the public sector.

This single-tranche IBRD DPL does not have financial counterparts, it has a 30 year maturity and five years of grace period.

Media Contacts
In Brasília
Juliana Braga
Tel : (+55 61) 3329-1099
In Washington
Marcela Sanchez-Bender
Tel : (+1 202) 473-5863