The support from the World Bank will help Paraguay to promote economic growth through sustainable practices as well as support farmers and rural producers to increase rural productivity

World Bank

Image: World Bank Group headquarters in Washington, DC. (Credit: Things.)

The World Bank has agreed to provide a $300m loan to Paraguay to strengthen its economy and to boost its rural productivity.

The financing will help Paraguay in facing the impact of economic, climatic and public finance vulnerabilities while contributing to the promotion of rural productivity by improving access to markets.

The financing package from the World Bank includes two operations.

A financial aid worth $200m, with a Deferred Disbursement Option, will support the nation’s efforts to reduce its vulnerabilities to external economic, environmental and public finance impacts, along with mitigating the negative effects on the economy.

It will contribute to the promotion of economic growth through environmentally sustainable and resistant climatic variations and help improve economic resilience through efficient and responsible management of public resources.

On the other hand, $100m of the financing will be used for supporting the Market Access for Agricultural Products Project, PIMA by its Spanish acronym. The project was implemented by the Ministry of Agriculture and Livestock (MAG).

PIMA will benefit 170,000 small and medium-sized organised farmers

The project will finance productive agricultural activities benefitting nearly 170,000 small and medium-sized organised farmers and indigenous agricultural producers along with producer organisations and indigenous communities and public institutions linked to rural development.

It will also promote the use of new agricultural technology, allowing for greater competitiveness and sustainable access to markets inside of the country and external to the country.

World Bank the Southern Cone Director Jordan Schwartz said: “The poorest households are especially vulnerable to economic and climatic shocks and food price movements. They are also those who suffer the most from pandemics such as the coronavirus.

“We are committed to promoting an inclusive Paraguay and these projects will contribute to improve productivity and create protection mechanisms for the poorest in the face of global economic or climatic challenges.”