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IDB approves $25 million for El Salvador to upgrade agricultural and forestry technology

The Inter-American Development Bank today announced the approval of a $25 million loan to El Salvador to upgrade agricultural and forestry technology and to rebuild irrigation and drainage infrastructure that was damaged by the earthquakes early this year.

The resources will finance the establishment of 20 rural service and information centers to provide and exchange information technology as well as business expertise. A Forestry and Agriculture Information Support System will be developed to provide producers with a link to markets and production information and support services, using information available on the Internet.

Nongovernment organizations and other private entities will administer the rural information centers, offering producers advice and training on using the facilities and gaining access to data on the Internet.

The national plant and animal health and food safety systems will be modernized to ensure that domestic agricultural and agribusiness output meets the standards and requirements of international trade and public health.

Investments will be made in the rehabilitation and reconstruction of public irrigation and drainage systems, including those damaged by recent earthquakes. The responsibility for the administration, operation and future rehabilitation of the public systems is to be turned over to the respective water user associations. Private irrigation systems will also receive financial support for infrastructure and technical assistance.

The country’s capacity to conduct research and to transfer technology will be strengthened by the establishment of a new National System for Alliances for Technological Innovation that relies on private sector participation. . The system will develop a methodology to identify priorities within agricultural activities and will generate and transfer agricultural technology on a competitive basis.

The total cost of the program, to be carried out by the Ministry of Agriculture, is $31,250,000. The IDB loan is for a 25-year term, with a 4-year grace period, at the variable interest rate, now 7.1 percent. Local counterpart funds total $6,250,000.

France, Spain and the United States provided technical cooperation grants to assist in the preparation of the project.

In previous loans this year, the IDB has provided El Salvador with $40 million in emergency financing for recovery and reconstruction from the earthquakes, as well as $58 million for road rehabilitation.

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