Brazil to Promote Sustainable Development of the Atlantic Forest in the State of Bahia

The Inter-American Development Bank (IDB) has approved a $100 million loan to improve income, food security, access to basic services, and climate change adaptation for the State of Bahia's rural population and protect the region's natural resources. The project's area of operation will cover the Atlantic Forest, located on Bahia's southern coast and comprising 77 municipalities.

The program approved by the IDB's Board of Executive Directors will benefit some 352,000 people in rural communities, especially in the most deprived municipalities. The project will also improve access to water for 56,000 people and sanitation for 48,000 and regularize land tenure in 10 Quilombola Afro-Brazilian communities. Half the beneficiaries will be families headed by women.

To make all this possible, the project will promote the adoption of agricultural technologies-with emphasis on climate change adaptation technologies-and the integration of producers into value chains. Plans are also in place to improve environmental conditions for rural families and their surroundings and facilitate access to drinking water and basic sanitation in rural communities.

Bahia's Atlantic Forest is one of the richest in biodiversity on the planet, but 49 percent of households in the project area live in poverty. The main source of income for rural families is farming, which faces low productivity and difficulties in accessing financing. Additionally, the forest is experiencing long-term degradation and the use of traditional farming systems has contributed to deforestation, which has reduced productivity in the project area.

This is the third individual loan operation under the Conditional Credit Line for Investment Projects (CCLIP) for the Agriculture and Sustainable Development Program.

The IDB loan has an amortization period of 23.5 years, a seven-year grace period, and an interest rate based on SOFR. The project will also receive $18 million in cofinancing from the International Fund for Agricultural Development (IFAD) and a counterpart contribution of $32 million from the State of Bahia.