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Brazil will improve the urban infrastructure in the state of Paraná

Loan of $150 million will benefit more than 900,000 people with basic infrastructure, neighborhood improvements and social services

The state of Paraná, with Brazil's sixth largest population, will reduce its shortage of urban infrastructure in a sustainable manner with a loan of $150 million from the Inter-American Development Bank (IDB).

Paraná has a high level of urbanization because people find more opportunities for jobs and better public services in cities, and therefore put increasing pressures to expand those services.

Between 1990 and 2000 the urban population grew at an annual rate of 2.3 percent due to the migration from the rural areas. This growth increased the level of urbanization from 73.4 percent to the current 85.3 percent. The speed of the population growth, added to the institutional weaknesses in many municipalities and the shortage of financial resources needed to attend to the needs of this new population, have led to significant deficits in the areas of basic infrastructure and urban public services.

This project will help to finance a bundle of public works for neighborhood improvements and urban revitalization, including drainage systems, paving, street lighting, green areas, bicycle paths, sports fields and urban mobility through the use of buses, as well as the construction and equipment of social service centers. It will be concentrated in 32 municipalities in the state of Paraná and is expected to benefit more than 900,000 people.

“This urban development initiative will continue to modernize and strengthen the policies for municipal financing, for sustainable revenues and improved planning of urban infrastructure, offering better basic services and quality of life to all citizens of Paraná,” said Mario Durán-Ortiz, team leader for the IDB project.

The project also will assist with the tax and financial management of the municipalities by updating tax codes, urban cadasters, mechanisms for public-private financing of urban investments, urban planning and management and support for the digital government, among other issues.

The funds also will finance a series of consultancies, including the modernization of the information platform PARANACIDADE and the use of the Internet to provide services more efficiently. This part of the project will include training for 3,466 municipal officials on financial and fiscal issues. 

The IDB loan is for 25 years, with a grace period of 5.5 years and an interest rate based on LIBOR.