WB/Brazil: Up to 16 Million to Benefit from Improved Public Services in Rio de Janeiro State

August 30, 2012

WASHINGTON, August 30th 2012 – Up to 16 million inhabitants of the State of Rio de Janeiro, Brazil will benefit from a US$300 million Development Policy Loan (DPL) approved today by The World Bank Board of Directors. The Rio State Development Policy Loan lll will improve the State’s financial and tax administrations, as well as the provision of education and health services,  

“The World Bank is Rio de Janeiro's longtime partner. With this new loan, you can consolidate fiscal policies that already allowed us to have a relevant economic growth. The operation will help us improve the efficiency of our health care system and improve the quality of our education network,” said Sergio Cabral Filho, governor of Rio de Janeiro State.  

The second largest economy in Brazil, Rio de Janeiro’s economic activity is equivalent to that of Portugal or Venezuela. In recent years, it has grown faster than the rest of the country. In 2009, the Gross Domestic Product (GDP) per capita was US$ 11,051, about 30 percent above the nation’s average.

With upcoming mega sports events  – the Football World Cup in 2014 and the Olympic Games in 2016 -, the State of Rio de Janeiro is  increasing investments in infrastructure and social development . 

“Beyond the high-profile international events, the fact is that challenges faced by Rio de Janeiro are not that different to those faced by other states throughout the world and in Brazil. This program can serve as a model for other countries and states that want to use resources efficiently and improve education and health services for all groups in the population,” said Deborah L. Wetzel, World Bank Director for Brazil.

This policy loan aims to improve the efficiency of public financial management and the quality of the State’s services through a set of diverse actions, including:

  • Increasing the efficiency of public investment by expanding the provision of services  through public - private partnerships
  • Enhancing governance by providing greater monitoring and transparency of  public investment
  • Improving tax administration
  • Improving the quality of public services delivered for low income households
  • Implementing  a merit-based selection process for school directors
  • Putting in place a new management model for health units
  • Improving the management of  budget transfers for health services in small municipalities to better target the needs of local communities

This is a one tranche loan from the International Bank for Reconstruction and Development (IBRD) to the State of Rio de Janeiro. It is guaranteed by the Federative Republic of Brazil and has a final maturity of 23 years and six months, with a five year grace period.


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