IDB supports program to increase medium and long term productive investments in Paraguay

Program will improve farmers' access to credit for productivity boosting investments  

The Inter-American Development Bank (IDB) has approved a $120 million line of credit to finance improvements in Paraguay's productivity. An initial loan of $30 million will go to the Project to Improve and Broaden Financial Products for the Productive Sector, focused on the agricultural sector.

The project seeks to increase medium and long-term loans for agricultural producers in order to improve their productivity and benefit their value chains.

The operation was arranged with the Financial Agency for Development (AFD), Paraguay’s state-owned development bank. Loan approvals will be carried out through eligible financial intermediaries.

Resources may finance investments by agricultural producers for the acquisition of technology, infrastructure, irrigation, equipment, transportation, storage, the purchase of cattle and any other activities related to the improvement of agricultural productivity and its value chains.

Any family and commercial producers in the agricultural sector who are part of a value chain will be eligible. The program includes a gender component, because 10 percent of the eligible borrowers must be women-led.

The low productivity of Paraguay's agricultural sector is due in part to the lack of access to medium and long-term financing that allows for sustainable investments in productivity and technological changes, by small as well as large producers, and their improved linkage to value chains.

This program seeks to contribute to improvements in the productivity of the agricultural sector, and in this way to improve the country's overall productivity.

In all cases, loans will be processed by first-tier financial institutions selected by the AFD.

The initial individual loan for the Project to Improve and Broaden Financial Products for the Productive Sector will have a disbursement period of five years.