A R$1 billion project with international support aims to train rural producers and increase food security in the semiarid region of the Northeast. Launched this week by the International Fund for Agricultural Development (Fida), in partnership with the National Bank for Economic and Social Development (BNDES) and the Ministry of Economy, the project Sewing Climate Resilience in Rural Communities in the Northeast (PCRP) aims to promote the sustainable development of the northeastern hinterland and mitigate the effects of climate change in the region.
The project intends to benefit 250,000 families (1 million people) in up to four states in the Northeast, which will still be chosen. By adding together the contributions from IFAD, BNDES and the counterpart from the state governments, investments could reach US$ 202.5 million (about R$ 1 billion at the current price).
Negotiations for fundraising were concluded this week. In December, the executive board of Fida had approved, unanimously, the allocation of resources.
The project will finance actions for sustainable water management and for combating drought and climate change. Among the main actions are the introduction of water collection, storage and recycling technologies and the adoption of productive diversification strategies in the sertão. The program intends to reach an area of 84 thousand hectares, restoring degraded ecosystems to provide services in the environmental area. One of the goals is to avoid the emission of more than 11 million tons of carbon dioxide in 20 years.
An initiative of the United Nations Organization that allocates resources for projects to adapt to climate change in developing countries, the Green Climate Fund (GCF) will contribute, through IFAD, US$ 100 million. Of this total, $34.5 million will come in as a donation and $65 million will come through credit operations.
Of the national resources, BNDES will grant US$ 73 million in financing, as the executing entity of the GCF. The remaining US$ 29.5 million will be invested in counterpart to the states.
After approval by the GCF and IFAD at the end of 2020, the BNDES, the Ministry of Economy and the international fund concluded negotiations on the loan agreement last Wednesday (30). The next steps are the conclusion of the project’s implementation arrangements and their vote by the BNDES’ Board of Directors. The Senate will need to approve the granting of guarantees from the Union. The expectation is that the first financing will start being granted in 2022.
Discussions began in 2018, when the federal government appointed BNDES as a potential IFAD partner in the financing and development of sustainable rural development projects. In 2019, the Ministry of Economy’s Secretariat for International Affairs and the Ministry’s External Financing Commission endorsed the operation.
With its specific mission to fight hunger and rural poverty, IFAD has received support from the Brazilian government for over 40 years. The international financial institution is based in Rome, where the United Nations Food and Agriculture Fund is located.
+ Learn about the effectiveness of each vaccine against Covid-19