The Inter-American Development Bank (IDB) approved a line of credit of up to $500 million to boost Bolivia’s water security and help ensure a sustainable supply of irrigation and drinking water.

This financing aims to increase Bolivia’s food security by 25%, as measured by the Food Insecurity Experience Scale of the Food and Agriculture Organization. It is also expected to raise the net agricultural income of family farms by 36%. The line of credit is designed to finance mechanized irrigation systems for approximately 12,500 families from communities that depend on agriculture for their livelihoods. These farms will be able to irrigate an additional 13,871 hectares as a result of the new systems.

The first individual operation of the line of credit is a $150 million loan for integrated water resources management in agricultural basins. The operation will also focus on boosting farms’ productivity and climate resilience and using irrigation water more efficiently in some areas of the country.

This first phase of the project will also include investments in mechanized, high-frequency community irrigation systems. Additionally, it will fund the design and launch of a national system for modeling and monitoring water resources that centralize existing information systems and informs water management decisions.

Agriculture accounts for 13% of Bolivia’s GDP and is the primary economic activity of 77% of the country’s rural population. In Bolivia, the average yield per hectare of the main crops is considerably lower than that of neighboring countries, and low irrigation coverage is a significant driver of the discrepancy. Poor agricultural productivity means less income for rural people and higher rates of food insecurity.