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IDB approves $55 million to support competitiveness of food and agriculture sector in Dominican Republic

The Inter-American Development Bank today announced the approval of a $55 million loan to the Dominican Republic to support the application of new agricultural technologies, greater food safety and economic reforms to make the food and agriculture sector more competitive and to reduce poverty.

The resources will provide direct support to farmers adopting technologies that will reduce unit costs of production in a sustainable manner and at the same time promote efficiency in the use of productive resources. By favoring small-scale farmers, the impact of new technology on productivity and incomes will help reduce rural poverty.

Partial cash rebates will be provided to farmers adopting technologies from a menu of options defined in the project - an innovative approach that provides direct support to farmers on a demand-driven basis.

In the area of food health and safety, a National Food Health and Safety system will be established, and the National Surveillance and Monitoring Project for Food residues and Hygiene will be activated. Departments of the Ministry of Agriculture* responsible for food safety will be strengthened, and new health and safety regulations will be adopted. Laboratories and quarantine stations will be upgraded, personnel trained, and coordination improved between the public and private sectors.

Technical assistance and consulting services will be provided to design additional agricultural policy and institutional reforms, including a geo-referenced survey and registry of farmers.

The project reflects the Bank strategy of developing the rural economy, increasing agricultural competitiveness while reducing rural poverty.

Other recent IDB loans have supported projects to benefit agricultural development in Bolivia, Colombia, El Salvador, Guatemala, Mexico, Paraguay, Peru and Uruguay. The IDB helped finance a major transformation and modernization of the food and agriculture support system in Mexico.

The total cost of the program for the Dominican Republic is $61.1 million. The IDB loan is for a 25-year term, with a four-year grace period, at the variable annual interest rate, now 6.97 percent. Local counterpart funds total $6.1 million.

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