BELÉM, Brazil – The Inter-American Development Bank (IDB), as part of the Amazonia Forever regional program, and the Brazilian Development Bank (BNDES), in the context of its continuing support to the Amazon, climate and alternative sustainable economic activities, today signed a letter of intent to move forward with PRO-AMAZÔNIA, a program that will scale up financing for micro, small and medium Enterprises (MSMEs) and small entrepreneurs in the Legal Amazon in Brazil.
Companies and small entrepreneurs from multiple sectors will benefit from financing for modernization, expansion, goods and equipment acquisition, and innovation. The financing will include incentives to adopt sustainable practices, contributing to creating jobs and building a balanced and environmentally responsible economy in the region.
The Amazon region plays a critical role in preserving biodiversity and in global climate regulation, making it a unique opportunity to create businesses that reconcile economic development with the search for sustainable business alternatives.
Fostering MSMEs in the Amazon region helps expand the use of new and sustainable technologies, boosting the emergence of innovative value chains and contributing to greater regional economic dynamism.
MSMEs in Brazil represent 99% of firms and are responsible for 27% of the gross domestic product (GDP) and 46% of jobs, mostly in the services sector. However, this business segment usually faces greater credit constraints than larger firms, and the challenges are even greater in the Amazon region, where access to logistics infrastructure, sanitation, education, health, and safety is more difficult than in other regions of Brazil.
Announced at the Amazon Presidential Summit, the commitment includes an IDB loan of $750 million, with $150 million from BNDES, which will be implementing the program through accredited financial agents. Individual loans must comply with IDB and BNDES environmental and social safeguards policies.
The PRO-AMAZÔNIA Program, which is planned to start in 2024, aims to foster sustainable development in the Amazon region, focusing on reducing regional inequalities by supporting small businesses and entrepreneurs.
“The partnership between BNDES and IDB plays an important role on this Program as it is being developed by long-term partner institutions with common goals in offering financing options to improve businesses and sustainable development. PRO-AMAZÔNIA has been designed to generate positive impact on both the environment and local communities, promoting synergy and prosperous future for the businesses in the region,” said BNDES President Aloizio Mercadante.
“We see this program as a key part of our efforts to help preserve the Amazon, which include incentives to adopt alternative, sustainable economic activities. Our Amazonia Forever program is a holistic effort that will seek to upscale our financing through novel financial instruments, strengthen the planning and execution of projects, and create networks to share knowledge and evidence-based innovations,” said IDB President Ilan Goldfajn. “BNDES, with its expertise and capillarity, is the ideal partner for this program.”
The Legal Amazon is a geographical delimitation comprised of the states of Acre, Amapá, Amazonas, Maranhão, Mato Grosso, Pará, Rondônia, Roraima and Tocantins. It has an approximate area of 5.1 million km² and is home to 67% of the world's tropical forests.
Amazonia Forever
Amazonia Forever is a holistic umbrella program that aims to protect biodiversity and accelerate sustainable development through three lines of action: expanding funding, boosting knowledge exchange and facilitating regional coordination among the eight Amazonian countries.
The program is based on five pillars: (i) combating deforestation and strengthening environmental control and security in the context of national governments; (ii) the bioeconomy, promoting alternative and sustainable economic activities; (iii) people, aiming for adequate access to quality education, healthcare and employment; (iv) sustainable cities and infrastructure and connectivity; and (v) sustainable, low-carbon agriculture, livestock and forestry. In addition, the program focuses on promoting the inclusion of women, indigenous peoples, people of African descent and local communities; climate and forest conservation; and strengthening institutional capacities and the rule of law.
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social, and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research projects and provides policy advice, technical assistance, and training to public- and private-sector clients throughout the region. Take our virtual tour.
Borges De Padua Goulart Janaina
Amazonia
Building on the progress made by the Amazon Initiative, and given the growing scientific consensus that the Amazon is reaching an ecological tipping point, we must further increase the impact of our actions in the Amazon.