WB approves loan to support expansion of Bolsa Família program [EN/PT] – Brazil
The project will support cash transfers to an additional 3 million people in poor households, including women, children, indigenous peoples and other minorities
WASHINGTON, October 29, 2020 – As part of an international effort to mitigate the negative economic effects associated with the COVID-19 pandemic, the World Bank Board of Directors today approved the billion dollars Brazil: Income support for the poor affected by the COVID-19 project. The program will support the scale-up of the Bolsa Família conditional cash transfer program, funding transfers to benefit at least 3 million people, including minorities.
The novel coronavirus pandemic has triggered a global health, economic and social crisis of unprecedented magnitude with a major impact on vulnerable populations. The recovery is expected to be gradual and uneven, with millions more families than before COVID-19 still expected to need support in 2021.
Since the first case of COVID-19 was recorded on February 26, the new coronavirus has infected more than 5 million people in Brazil. As a result, the Brazilian government and the World Bank have agreed to put in place a strong joint response to protect the most vulnerable people.
“From the start of the pandemic, the Brazilian government implemented a strong political response to the COVID-19 crisis to provide protection to vulnerable groups. This included important social protection measures, in particular emergency aid. With investments of nearly US $ 60 billion, the program has already made monthly payments to more than 67.8 million Brazilians, ensuring a direct and indirect positive impact on the lives of more than 126.5 million Brazilians. As a further measure to mitigate the effects of the pandemic, the government has decided to expand the Bolsa Família program, adding 1.2 million new families. Therefore, this partnership with the World Bank will allow us to include families who have become temporarily poor or who had not been able to join the program before, ”explains Onyx Lorenzoni, Ministry of Citizenship.
The COVID-19 pandemic has put pressure on the Brazilian economy. In response, the government of Brazil pledged to put in place a rapid and substantial fiscal stimulus plan. These measures are expected to greatly mitigate the impacts of COVID-19 on poverty in 2020, although the poverty outlook for 2021 remains uncertain as temporary support measures expire and the labor market remains sluggish. The unemployment rate in August 2020 had reached 13.6%.
Before the pandemic, around 13 million families were registered with Bolsa Família. The project will finance the expansion of Bolsa Familia to extend protection to at least 1.2 million poor families who will still need support after the end of the emergency cash transfer. Women represent 90 percent of direct beneficiaries. This expansion will benefit at least 3 million people, including 990,000 children and youth and 7,000 indigenous people.
By promoting such expansion, the project seeks to ensure economic support for poor families but also mitigates the loss of human capital. Once enrolled in the program, families should ensure that their children attend school and have regular check-ups. This means having the immunization schedule up to date and seeing the family doctor frequently. Although Bolsa Familia’s conditions were temporarily lifted during the COVID-19 pandemic, they continue to be closely monitored and will resume once the crisis subsides.
The World Bank will also provide the Ministry of Citizenship with technical assistance, in coordination with other bilateral donors, to assess the potential impacts of changes in the Bolsa Familia program, help beneficiary families participate in the economic recovery and learn lessons. social emergency. protection programs in Brazil and around the world.
“The uncertainty surrounding the trajectory of the COVID-19 pandemic and the prospects for poverty make it crucial to expand the Bolsa Familia program and protect the poor in these difficult times. The conditional cash transfer is also essential during the recovery phase, as it encourages families to access health services and ensures that children return to school, once these services are restored. The extensive literature on the impacts of Bolsa Familia highlights the ability of this program to improve children’s school attendance and improve several health outcomes. These are essential to prevent the depletion of human capital, which is the engine of long-term social and economic development, ”said Paloma Anós Casero, director of the World Bank in Brazil.
The outcomes supported by the program include:
Maintaining families above the extreme poverty program line
Reduce the risks of degradation of human capital by monitoring the school attendance of beneficiaries (6 to 17 years old) and health checks
This USD 1 billion loan from the International Bank for Reconstruction and Development (IBRD) to the Ministry of Citizenship is guaranteed by the Federative Republic of Brazil and has an average repayment term of 7.88 years.
World Bank Group Response to COVID-19
the World Bank Group, one of the most important sources of finance and knowledge for developing countries, takes wide and fast action help developing countries strengthen their response to the pandemic. We support public health interventions, work to ensure the flow of essential supplies and equipment, and help the private sector continue to function and maintain jobs. We will deploy up to $ 160 billion in financial assistance over 15 months to help more than 100 countries protect the poor and vulnerable, support businesses and support economic recovery. This includes $ 50 billion in new IDA resources in the form of grants and highly concessional loans.
For more information: www.worldbank.org/lac
PRESS RELEASE N °: 2021/052 / LAC
+1 (202) 458-4862
+55 (61) 3329-1059