Brasília – Loans from the World Bank to Brazil should nearly double over the next 12 months, announced the president of the institution, Robert Zoellick. During a visit to the country, he stated that the majority of these extra funds should be allocated to poverty eradication projects in the Northeast.
In 2010, the bank loaned US$ 3.7 billion to Brazil. This year, the organization intends to loan from US$ 5 billion to US$ 6 billion. Out of that total, US$ 3.5 billion will be destined to the Northeast region alone.
To the World Bank president, the Northeast requires more attention because the institution wants to promote the convergence of development across different regions. In the weekend, he will travel to Pernambuco, where he will meet with seven state governors in the region to discuss the bank’s support projects.
According to the World Bank’s director for Brazil, Makhtar Diop, the focus of the institution in the region is not only on isolated projects such as the building of schools and hospitals, but also support to long-term development policies, such as professional training, training to civil servants and improvement of fiscal conditions. “We want to bring sustainable growth to the region, overcoming fiscal limitations in state governments and raising labour force competitiveness,” he said.
According to Zoellick, the agreement for pre-payment of US$ 3.1 billion of the country’s debt with the institution will enable the continuation of loans to the states. “We had to make this agreement because several short-term operations in Brazil were pushing down the limits of what the country is entitled to.”
The maximum amount of credit allowed to each country by the World Bank is US$ 16.5 billion. At present, 64 projects are funded by the bank in Brazil, across 19 different states, totalling US$ 13 billion.
Regarding his meeting with president Dilma Rousseff, scheduled for this Thursday (2nd), Zoellick stated that he will address the success of social policies in the country, which, according to him, have rescued 20 million people from absolute poverty. He should also tackle the preparations for the meeting of the G20– the group of 20 leading economies in the world – due November in France. According to him, measures will be discussed for curbing the volatility of international prices.
As for the end of the permanence of North Americans at the helm of the World Bank, which Brazil was favourable to, Zoellick claimed that the institution has promoted reforms to increase voting rights of developing countries and that he has appointed economists from these nations to key positions at the bank. Currently, the three executive directors of the bank are from Nigeria, Egypt and Indonesia, and the chief economist is Chinese.
“In the long run, the involvement of emerging nations in management might be more important than the [voting] percentage,” said the president of the World Bank.
*Translated by Gabriel Pomerancblum
