The Impact of Public Credit Programs on Brazilian Firms

This paper analyzes the effectiveness of public credit lines in promoting the performances of Brazilian firms. We focus on the impact of the credit lines managed by BNDES and FINEP in fostering growth measured in terms of employment, labor productivity and export. For this purpose, we use a unique panel data set developed by the Instituto de Pesquisa Econômica Aplicada (IPEA), which includes information on both firm-level performances and access to public credit lines. This particular data setting allows us to use quasi-experimental techniques to control for selection bias when estimating the impact of the public credit lines. The core of our estimation strategy is based on a difference-in-differences technique, which we complement with matching methods for robustness check. Our results consistently show that access to public credit lines has a significant and robust positive impact on employment growth and exports, while we do not find evidence of a significant effect on our measure of productivity. Interestingly enough, our findings show that impact on exports is driven by the increase in export volumes among exporting firms, while no significant effect on the probability of becoming an exporter is detected.

Public credit plays an important role in supporting the Brazilian productive sector. Data show that the presence of the public sector in the banking sector is high. The largest state owned development bank –the Banco Nacional do Desenvolvimento (BNDES)– accounted for 11 percent of all outstanding credit in 2006. Considering that the state also owns two of the three largest commercial banks in Brazil, the percentage of outstanding credit accounted for stateowned banks increases to around 44 percent. Although the importance of the public sector in the Brazilian financial system has been broadly debated, not much has been said on the effectiveness of these policy instruments in improving the conditions of final beneficiaries of these resources.

This paper aims at shedding some light on the effectiveness of public credit programs in promoting the performances of the productive sector in Brazil. In particular, we focus on the impact of the credit lines managed by BNDES and FINEP in fostering growth measured in terms of employment, labor productivity and export. For this purpose, we use a unique panel data set developed by the Instituto de Pesquisa Econômica Aplicada (IPEA), which includes information on both firm-level performance and access to public credit lines. This particular data setting allows us to use quasi-experimental techniques to control for selection bias when estimating the impact of the public credit lines. The core of our estimation strategy is based on a difference-indifference technique, which we complement with matching methods for robustness check.

Our results consistently show that access to public credit lines has a significant and robust positive impact on employment growth and exports, while we do not find evidence of a signiicant effect on our measure of productivity. Interestingly enough, our findings show that impact on exports is driven by the increase in export volumes among exporting firms, while no significant effect on the probability of becoming an exporter is detected. 

The scope of this paper is mainly empirical and its contribution to the existing literature should be considered in this context. This means that we do not develop any formal model aimed at assessing the theoretical linkages between access to credit and the firm-level performances. However, we complement our empirical analysis with a brief discussion of these linkages in light of the existing literature. To put our paper into context, we also review the most recent impact evaluations of public programs with objectives and means similar to the ones of the credit lines we analyze.

The paper is structured as follows: after this introduction, section one provides a brief review on the justification of public credit program aimed at fostering firm performances and on the evidence that have been produced on the effectiveness of such programs. Section two discusses more in detail the main characteristics of public credit programs in Brazil, with particular emphasis on the credit lines managed by BNDES and FINEP. Section three describes the data we are using for our analysis, including a review of the main basic statistics of interest. Section four discusses our identification strategy, focusing on the approach we adopted to control for selection biases. Section five presents the results of our estimations. Finally, section six concludes and provides some policy recommendations.

World Bank. Joao Alberto DeNegri.Alessandro Maffioli.Cesar M. Rodriguez. Gonzalo VázquezWorking Papers.No. IDB-WP-293.December 2011

The Impact of Public Credit Programs on Brazilian Firms

For more information about Projects in Brazil see Brazil Projects

c

FOMIN backs business opportunities in greenhouse gas management for Brazilian SMEs

News Releases. Jan 5, 2012.The Inter-American Development Bank’s Multilateral Investment Fund (FOMIN), in partnership with the Brazilian National Standards Organization (ABNT), will launch a program to help 200 small and medium-size companies manage their greenhouse gas emissions.

The $2.8 million project will provide technical support to SMEs to carry out emissions inventories, support participating companies with identifying related business opportunities and help the ABNT become accredited as a third-party verifier of GHG emissions according to internationally accepted standards and protocols.

To date, voluntary GHG management initiatives in Brazil have only involved large companies. There are few resources available to assist SMEs in training staff and implementing GHG management systems, and there are no Brazilian organizations or firms accredited as third-party verifiers of GHG emissions to assure the quality of data.

“Equipped with better tools and capabilities, Brazilian SMEs will no longer be left on the sidelines of the region’s burgeoning green economy,” said FOMIN project team leader Zachary Levey.

Brazil is considered a global leader in climate change action and sustainability. In 1992 it hosted the United Nations Conference on Environment and Development (UNCED, or the Rio Earth Summit) in Rio de Janeiro, where the United Nations Framework Convention on Climate Change (UNFCCC) was signed. Brazil will host the Rio+20 Summit in June 2012.

The project will be executed by ABNT, a non-profit established in 1940 to develop technical standards in Brazil. A founding member of the International Organization of Standardization, ABNT has significant experience with implementing quality management systems, environmental management systems and several product certification schemes for SMEs.

For more information about Projects in Brazil see Brazil Projectsx

Carbon Rights in Brazil

Brazil does not have a national law that specifically addresses the legal nature and ownership of carbon credits or rights to greenhouse gas (GHG) emission reductions and/or removals. It is however expected that the implementation of the Brazilian Climate Change Policy, which promotes the development of an organized Brazilian carbon market overseen by the Brazilian Securities and Exchange Commission, will lead to an eventual  clarification of the precise nature and ownership of tradable carbon rights. 

Some legislation at state-level already refers to rights derived from measures that reduce or remove GHG emissions, but stops short of clearly stating how these rights to  emission reductions are to be treated outside the governmental programs they create. For instance the Amazonas State Climate Change Policy establishes the general legal framework for promoting carbon offset projects and payments for ecosystem services within land owned by the State, and assigns the rights to exploit environmental products and services (implicitly including carbon rights) to a publicprivate institution created for this purpose

In the absence of particular legal treatment, general provisions of constitutional and civil law are applied to define initial ownership of these credits or rights. The Brazilian Civil Code states that the ownership right shall include the right to use, dispose of , and legally defend the property  against unlawful possession. The Civil Code further states that the accessories or products derived from “a thing” belong to the owner of that thing unless stipulated otherwise by specific rule or contract (e.g., the rights to accessories and products may be transferred via usufruct, lease or the grant of surface rights). As a general rule this implies that the right to exploit GHG benefits associated with a certain activity rests with the owner (or rightful holder) of the physical asset or process that generates 

World Bank. Author: Chagas, Thiago. Document Date: 2010/10/01.Document Type: Working Paper.Report Number: 65866

Carbon Rights in Brazil

For information about Projects in Brazil see Central Brazil Projects

See Ghana.Carbon Rights

x

Achieving World-Class Education in Brazil: The Next Agenda

Brazil has made great strides in basic education over the past 15 years and has set audacious national goals for attaining OECD levels of quality  by 2021.Basic education in Brazil historically has consisted of a fi rst cycle of eight grades (called primary education in this report and known as “fundamental education” in Brazil) and a second cycle of three grades (secondary education). In 2006, the country adopted legislation extending the length of compulsory schooling by one year and creating a nineyear primary cycle. The offi cial entry age to primary school was lowered from seven to six. The preschool cycle was correspondingly shortened to cover ages four through fi ve rather than four through six. Because the new system was not implemented until 2009, we use the old system throughout this report for consistency in comparing historical data, unless otherwise specified.

The 2009 results for the Program for International Student  Assessment (PISA), which measures high school student learning levels in more than 70 countries, confi rmed Brazil’s impressive progress in raising educational performance. Brazil’s 52-point increase in math since 2000 indicates that students have gained a full academic year of math mastery over the decade, and the country’s overall score increase—from 368 to 401—is the third largest on record. Brazil’s scores still trail the averages for OECD and East Asian countries, and are no grounds for complacency. But few countries have made faster or more sustained progress.

How did Brazil move from one of the worst performing education systems of any middle-income country to strong and sustained improvement not only in learning but also in primary and secondary school coverage? What are the prospects for Brazil to achieve its goal of student learning levels on par with the OECD average over the next decade? What more could be done to accelerate Brazil’s education advance? These are the three central questions of this report. 

We focus on basic education, which is the foundation in every country for all other progress in education. By telling the story of Brazil’s remarkable  run of policy continuity and sustained reform over the past fi fteen years, we hope this report can serve as a resource for other developing countries seeking rapid progress in education. By benchmarking Brazil’s current education performance in a competitive global context, we identify issues that still need attention. In reviewing the latest research from Brazil and elsewhere that can guide the design of sound reforms and cost-effective programs, we hope to stimulate and support the federal, state and municipal governments in setting the education agenda for the next decade. This report will succeed if it persuades a broad audience of Brazilian policy makers and citizens that the country is making impressive progress in education, but the agenda ahead is crucial. 

World Bank.Author: Bruns,Barbara; Evans,David;Luque, Javier. Document Date: 2011/01/01. Document Type: Publication. Report Number: 65659.

This volume is a product of the staff of the International Bank for Reconstruction  and Development / The World Bank. The fi ndings, interpretations, and conclusions  expressed in this volume do not necessarily refl ect the views of the Executive  Directors of The World Bank or the governments they represent.The World Bank does not guarantee the accuracy of the data included in this  work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgement on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of  such boundaries.

Achieving World Class Education in Brazil: The Next Agenda

For  information about Projects in Brazil see Brazil Projects

x

Brazil: More Reliable, Affordable and Sustainable Power for All

Press Release No:2012/214/LAC.WASHINGTON, December 20, 2011. Brazil’s energy and mining sectors are among the largest in the developing world, and have contributed significantly to the country’s growth in recent years. However, both still face challenges to realize their full development potential and promote environmental sustainability and social inclusion.

To support Brazil’s efforts to meet these challenges, the World Bank has approved today a US$ 49.6 million loan for the Energy and Mineral Sectors Strengthening Project. The project will directly benefit the Brazilian population, and especially the poorer groups most dependent on energy affordability and mineral extraction, who will have access to more reliable power at lower prices, and receive increased positive spillovers from an expanding, more efficient and sustainable mineral sector.

The Project will provide technical assistance to strengthen the capacity of key public institutions to increase the sector’s contributions towards a lower carbon growth path that is environmentally and socially sustainable. This will be especially important as Brazil accelerates its economic growth in the next few years and continues to expand its global role in the mineral and energy sectors.

“Brazil has one of the world’s cleanest energy matrices in the world and is a leading mining country, with extensive regulatory and implementation experience in both sectors. This has long drawn the attention of other developing countries,” said Makhtar Diop, World Bank Country Director for Brazil. “The Project will help make this wealth of knowledge available, expanding the reach of its positive economic, social and environmental effects as countries in Africa, Latin America and the Caribbean learn from Brazil.”

The project has four components:

· Strengthening government capacity to promote sustainable development in the energy and mineral sectors, including technical assistance for the Ministry of Mines and Energy to develop investment strategies, implement sustainability policies and monitor impacts.

· Strengthening regulatory agencies such as the National Electricity Agency (ANEEL), the National Mineral Production Department (DNPM) and the National Geological Survey Service (CPRM). The component will support improved policy formulation, monitoring and control of the power sector, institutional strengthening in the mineral sector and modernization of geological surveys.

· Support for the development and adoption of cutting-edge technologies in both the power and mineral sectors, to improve research, prevent natural disasters and attract investments.

· Support for south-south cooperation, including the development of internal procedures, technical assistance and capacity building in the areas of climate change, renewable energy, regulation, and social sustainability, among others, in the mineral and energy sectors.

This US dollar-denominated commitment-linked IBRD flexible loan with a variable spread has a 17.5 grace period and 18 years final maturity.

Contacts: In Brasilia: Mauro Azeredo, (55 61) 3329-1059, mazeredo@worldbank.org  In Washington: Patricia da Camara, (202) 473-4019, pdacamara@worldbank.org 

For more information about Projects in Brazil see Brazil Projects

x

Brasil.Institutional Framework for Sub-salt Oil Production

This consultancy will support the National Agency of Petroleum, Natural Gas and Biofuels (ANP) in the development of the new regulatory framework and of an appropriate institutional framework for the economic use of the sub-salt reserves.

The document will provide detail on who are the different actors involved in the process, including the definition of the areas to the realization of production, what are their roles, and what are the laws and regulations governing their actions. Also, the study intends to clearly identify and differentiate the missions and responsibilities of the different authorities, so as to avoid inefficiencies and overlap.

In particular, in relation to ANP (the National Agency of Petroleum, Natural Gas and Biofuels) and PPSA (Pré-Sal Petróleos SA, the sub-salt company) the study should consider a transition phase, where ANP will act as PPSA. Thus, the study should suggest what would be the decision-making processes and the major administrative tasks that should be incorporated into ANP which will subsequently be transferred to PPSA.These objectives are consistent with the country strategy in two key areas: (a) productivity and infrastructure ... to use public-private partnership models in new investments ... and (b) modernization of the state and institutional strengthening (as contained in the document GN-2570 of May 4, 2010).

IDB. IBR-T1206 : Institutional Framework for Sub-salt Oil Productions

Brasil.São Paulo Integrated Program of Math Tutoring and Talent Recognition

Dismal average results on standardized test, such as PISA, Prova Brasil and SARESP, has opted the state of São Paulo to pursue quality enhancing mechanism in the form of math tutoring and talent recognition. State-run middle and high-schools in São Paulo have been targeted in this operation due to the significant need of improvement in quality of education.

BR-X1025:São Paulo Integrated Program of Math Tutoring and Talent Recognition 

Brazil.Municipality of Rio de Janeiro for Fiscal Consolidation

This two-tranche Development Policy Loan (DPL) of US$1,045 million to the Municipality of Rio de Janeiro (MoRJ) in Brazil was signed on August 20, 2010, and became effective on August 27, 2010. The first tranche of US$ 545 million was disbursed on August 31, 2010. The second tranche of US$500 million is to be disbursed upon completion of specific tranche release conditions related to the government's reform program.

The loan supports the government in its efforts to achieve faster, more equitable and sustainable growth by increasing investment to improve the quality and coverage of social services, particularly in vulnerable areas of the city and to strengthen public sector management. This DPL is fully consistent with and closely linked to the objectives of the proposed new Brazil Country Partnership Strategy (CPS) 2012-2015.

The new CPS discussed by the Board on November 1, 2011, which focus on creating opportunities for growth and employment, targeting the poor and vulnerable, strengthening governance and promoting global collective action, as well as stimulating private sector innovation and competitiveness

World Bank.Document Date:2011/01/01.Document Type:Tranche Release Document.Report Number:65707.Volume No:1 of 1

Brazil. Municipality of Rio de Janeiro for Fiscal Consolidation for Efficiency and Growth Development Policy Loan Project:release of the second tranche - full compliancef

IDB closes $430 million syndicated loan to Brazil’s Embraport project

IDB.Nov 25, 2011. WestLB, HSBC, Caixa Geral, Santander join IDB’s A/B Loan Program to finance a project that is critical to help ease congestion at Santos port.The Inter-American Development Bank (IDB) closed a $430 million syndicated loan with a group of four international commercial participants to finance the construction, operation and maintenance of a new private mixed-use container and liquids terminal in Brazil’s Santos Port, the largest port complex in the region.

The loan was granted to Empresa Brasileira de Terminais Portuários S.A. (Embraport), responsible for the project, which is critical in easing congestion and reducing costs in Santos. The transaction involves a 15-year $100 million IDB A loan and a 12-year IDB B loan of $330 million from WestLB, Caixa Geral de Depositos, HSBC and Banco Santander.

In parallel, Caixa Economica Federal of Brazil has also approved separate financing for the project totaling R$633 million, funded by BNDES, which alongside the IDB financing, will make up the $786 million (equivalent) global senior debt package.

“This operation sets an important milestone for the IDB and Brazil because we see it as an aggressive step towards supporting more private investment in the port sector. In this difficult credit environment, the IDB plans to do more to support Brazilian infrastructure, both through our own balance sheet as well as through attracting participants and co-financiers,’’ said John Graham, the project team leader at the IDB’s Structured and Corporate Finance Department.

The loans from the IDB and CEF/BNDES will finance the first phase of the new terminal, which will have an expected capacity of more than 1 million TEU (a measure that refers to number of 20-foot containers that the facility can handle per year) and will be able to handle liquid bulk. The project will improve the port’s capabilities to receive a new generation of deeper-draft container ships, which have already become commonplace in the global shipping market, helping reduce waiting lines outside the port.

The new terminal will also contribute to improved traffic conditions in the city because it will have adequate road and rail connections, and will be located away from the congested urban area of Santos itself. The new terminal will create approximately 1,500 direct jobs during construction as well as 550 employees at the outset of the operation and 1,500 at full capacity.

About the IDB's Structured and Corporate Finance Department
The Structured and Corporate Finance Department (SCF) leads all IDB's non-sovereign guaranteed operations for large-scale projects, as well as those linked to companies and financial institutions. Through its Loan Syndication Program, SCF acts as a catalyst, helping to engage third-party resources by partnering with commercial banks, institutional investors, co-guarantors and other co-lenders for projects with high developmental impact.

Brasil.Environmental Sanitation Program for Municípios in the Guanabara Bay Area-PSAM

The aim of the operation is to help restore water quality in Guanabara Bay; and itspurpose is to increase the level of collection and treatment of wastewater in the bay, thus helping to reduce the organic load discharged into the bay from domestic sources. These objectives will be achieved by implementing three components: Wastewater collection and treatment works and equipment; Operational improvement and institutional development; and Sustainability of municipal public sanitation policies.

BR-L1282:Environmental Sanitation Program for Municípios in the Guanabara Bay Area-PSAMa

Brazil:University of the Little Market.Nurturing Micro and Small Business

Opportunities for the Majority seeks the approval of the Operational Input related to the loan proposal BR-L1298, to strengthen the "Banorte Every Day" in its entirety, since it can be assumed that a better managerial performance of the "little market" ("mercaditos") will enhance the welfare of low-income population in several ways:a) Training of mercadito owners and their employees will raise the level of professionalism in managing their facilities, which will strengthen them as microenterprises.

Thus, these mercaditos can continue to be the source of income for their owners and employees, who generally belong to the base of the socioeconomic pyramid;b) The strengthening of the mercaditos will allow the low income communities from its surroundings to enjoy the services provided from businesses that are better prepared to meet their needs, specially taking into account the expected increase in demand due to the growth of the middle class in Brazil;c) The management training for owners and employees of the mercaditos which participate in the "Banorte Everyday" program will better prepare them to use the resources of the funding more efficiently and develop a culture of responsible repayments. By doing so, the OI help to ensure the sustainability of the program and its continued expansion into other regions;d) The training program includes other important aspects, such as proper food and waste handling, strengthening the program in social and environmental terms.e) In addition, financial education will bring benefits to both final consumers and to the "Banorte Everyday" program as a whole.

End users will be better prepared to manage their credit and avoid over-indebtedness that can cause financial problems. Therefore, the quality of the portfolio under the "Banorte Everyday" will represent a more manageable risk by having a portfolio with fewer troubled loans and lower expected losses.f) Finally, this operational input can bring other positive externalities to the project, which helps low-income people to behave responsibly with the increasing access to various sources of funding for consumption that are arising as a consequence of their somewhat higher income level.

IDB.BR-T1215:BR-T1215.

University of the Little Market - Nurturing Micro and Small Business

Brazil.IDB approves $452 million for sanitation program in Brazil’s Baía de Guanabara

IDB.News Releases. Nov 23, 2011. Resources will help Rio de Janeiro state to advance on a program to expand sewage collection to 80 percent of the state’s population by 2018.The Inter-American Development Bank (IDB) approved a $452 million loan to improve sewage collection at Baía de Guanabara, one of Brazil’s best known tourism landmarks.

The resources will allow Rio de Janeiro state’s government to advance in the implementation of the Sanitation Program for the Municipalities of Baía de Guanabara (PSAM), a region that is home to over 10 million people. The program is part of the Sanitation Pact, a plan approved in April aimed at expanding sewage collection to 80 percent of the state’s population by 2018.

“The goal is to improve sewage collection and treatment levels, lowering the organic domestic waste that reaches water channels. As a result, the program will help improve the Baia de Guanabara’s water quality,” explains Yvon Mellinger, the IDB project team leader.

An estimated 359,000 households are expected to gain access to sewage collection, directly benefitting 1.68 million people.

The project involves not only the installation of sewerage collectors and treatment systems, but also investments to improve public services offered by different state bodies as well as the promotion of sustainable sanitation policies in the municipalities. Rio the Janeiro state has committed before the International Olympic Committee (IOC) to invest in the environmental recovery of Baía de Guanabara when its capital, Rio de Janeiro, was chosen to host the 2016 Olympic Games.

The loan is for a 25-year term, with five-year grace and disbursement periods, and a variable interest rate based on LIBOR. Financing for program will be complemented by $188 million from the state government, bringing the total investment to $640 million.

Brazil: Program to Strengthen the Social Assistance System

The Project consists in supporting the Ministry of Social Development and the Fight against Hunger ¿ MDS in promoting greater efficiency and effectiveness in services and programs offered by the social service network of SUAS. The recent expansion of SUAS, when thousands of social units as CRAS and CREAS were implemented across the country, represented a step forward for setting up a network of social assistance services which today are faced with different obstacles.

The main difficulties are due to SUAS ¿immaturity¿- a recent model yet in construction - which requires the establishment of quality parameters to assess the result of provision of its services and programs, as well as the improvement of its own internal management capacity and regulatory mechanisms, led to the establishment of clear rules of relationship between levels of Government and between public and private services linked to SUAS network.

IDB.Brazil.BR-L1299: Program to Strengthen the Social Assistance System

Brazil.Paraa­ba Second Rural Poverty Reduction

World Bank. Author: Bresnyan,Edward William. Document Date: 2011/11/20.Document Type:Implementation Status and Results Report.Report Number:ISR4827. Country: Brazil. Disclosure Date: 2011/11/20. Doc Name: Brazil -Paraa­ba Second Rural Poverty Reduction:P104752- mplementation Status Results Report : Sequence 07. Language: English. Rel. Proj ID: BR-Para�Ba Second Rural Poverty Reduction-- P104752. 

See documents related to the project(s)

Achieving world-class education in Brazil: the next agenda

Education is improving in Brazil. The average years of education has almost doubled over the last 20 years, as has the proportion of adults who have completed secondary school. Brazil's high school students have improved consistently in math and language performance over the last decade. These gains stem from the federal government's priority attention to education through both reforms and resources over the past 15 years.

The progress laid out in this book is impressive and praiseworthy, but Brazil still trails its competitors in several of the ways that matter most. Student learning, while improving, still lags far behind wealthier nations. Many secondary schools lose the majority of their students well before graduation.

Teachers are drawn from among the lowest achievers and have few performance incentives, and it shows in how class time is used. This important book explores not only the basis for Brazil's progress, but also what it must do to bridge the remaining quality gap to a first-rate education for its children. It provides detailed recommendations for strengthening the performance of teachers, supporting children's early development, and reforming secondary education. In Brazil's highly decentralized basic education system, each level of government has an integral role to play.

World Bank.Author: Bruns, Barbara; Evans,David;Luque,Javier;Document Date: 2011/01/01. Document Type: Publication. Report Number: 65659. Volume No:  1 of 1

Achieving world-class education in Brazil: the next agenda

IMPSA gets IDB loan to finance Latin America wind energy investment plan

IDB. News Releases. Nov 17, 2011. IMPSA, one of the world’s leading renewable energy companies, will get a $150 million loan from the Inter-American Development Bank (IDB) to help finance its plans to expand wind energy generation in Latin America.

The IDB loan will be to IMPSA’s Brazilian subsidiary Wind Power Energía S.A. to support the construction of an estimated four wind farms, three in Brazil and one in Uruguay, which will add 546 megawatts of wind energy capacity in the region by 2014. The estimated $1.4 billion investment program is expected to reduce carbon emissions by approximately 595,000 to 680,000 tons of carbon dioxide per year once the projects are fully operational.

“The long-term financing provided by the IDB will allow IMPSA to advance on its plans to build a long-term renewable energy market in Latin America and bypass the current turbulence in credit markets, which could make project financing more challenging in the coming months,’’ said John Graham, project team leader at the IDB’s Structured and Corporate Finance Department. “The IDB maintains ambitious targets for expanding its renewable energy portfolio across the region, and operations such as the IMPSA financing are meant to have a catalytic impact on this rapidly expanding sector.”

The three new Brazilian wind power plants will add an additional 481 megawatts of installed capacity in Brazil while the plant in Uruguay, known as El Libertador, will contribute with at least 13 percent of the country’s strategic goal of reaching 500 megawatts of installed wind capacity over the next five years.

The IDB will also provide IMPSA with technical assistance to conduct an energy efficiency audit in its primary hydro and wind turbine manufacturing plant. The study will help identify options for reducing the energy costs and greenhouse gas emissions at the plant, solutions that can be also implemented in other IMPSA’s plants.

IMPSA has installed hydro and wind power generation equipment across more than 110 projects in 30 countries with a cumulative capacity of approximately 23,600 megawatts. IMPSA ranks as the largest Latin American wind equipment manufacturer and direct investor in wind farms as well as the second largest manufacturer of hydro equipment in the region

Project Information

• IMPSA Wind Energy Investment Program

Press Contact

• Romina Tan Nicaretta
  rominan@iadb.org
  (202) 623-1555

Low-Income Countries' BRIC Linkage: Are There Growth Spillovers?

Trade and financial ties between low-income countries (LICs) and Brazil, Russia, India, and China (BRICs) have expanded rapidly in recent years. This gives rise to the potential for growth to spill over from the latter to the former.

We employ a global vector autoregression (GVAR) model to investigate the extent of business cycle transmission from BRICs to LICs through both direct (FDI, trade, productivity, exchange rates) and indirect (global commodity prices, demand, and interest rates) channels.

The estimation results show that there are significant direct spillovers while indirect spillovers also matters in many cases. Based on these results, we show that growing LIC-BRIC ties have significantly helped alleviate the adverse impact of the recent global financial crisis on LIC economies.

IMF.Author/Editor:Samaké, Issouf ; Yang, Yongzheng. Authorized for Distribution: November 01, 2011
This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Low-Income Countries' BRIC Linkage: Are There Growth Spillovers?

Brazil.Rural Poverty Reduction Project-Minas Gerais

Ratings for the Rural Poverty Reduction Project - Minas Gerais for Brazil were as follows: outcomes were satisfactory, risk to development outcome was low, Bank performance was satisfactory, and borrower performance was also satisfactory.

Some lessons learned included: the Project's demand-drivenness improves local governance by giving poor rural communities a unique set of experiences involving collective action, priority-setting, decision-making, and investment financial management, operation and maintenance. Social capital under this and similar projects is both a benefit in its own right and an element in the success of participatory rural poverty reduction.

By working with existing CMDRSs (Conselho Municipal de Desenvolvimento Rural Sustentavel - Sustainable Rural Development Municipal Council) in the project area and successfully increasing their representation among potential project beneficiaries, both the quality and targeting of public resources (project and non-project) improved, while leveraging complementary funding and deepening the investment stock needed for faster rural poverty reduction.

Experience in Minas Gerais and elsewhere shows unequivocally that demand-driven mechanisms not only enable women to access the benefits of community investments, but provide opportunities for women through the community associations.

The project demonstrated, albeit on a small scale, that participatory, demand-driven mechanisms are cultural practices of these groups and that they can manage the subproject participatory mechanisms, effectively.

World Bank.Document Date:2011/01/20. Document Type:  Implementation Completion and Results Report. Report Number:  ICR1657. Volume No:  1 of 1

Brazil.Rural Poverty Reduction Project-Minas Gerais

Brazil.Banco Indusval - TFFP

This operation is a loan under the approved TFFP line for Banco Indusval (BR-L1301) based on the enhancement of the TFFP Program. Inter American Development Bank.

BR-L1339 : Banco Indusval - TFFP

Brazil-Formoso River Integrated Watershed Management and Protection Project

Ratings for the Formoso River Integrated Watershed Management and Protection Project for Brazil were as follows: overall Trust Fund (TF) outcome was satisfactory; overall risk to development outcome was moderate; Bank performance was satisfactory; recipient performance was also satisfactory. Some lessons learned include: protracted project preparation, as well as delayed effectiveness, can deflate and outdate a project, requiring considerable effort and time to re-engage and re-energize relevant people and organizations, and impeding its efficient launching and implementation.

Recipients with little/no experience with international funding need Bank support/training to fully understand Bank procedures. Project supervision requirements are much the same whether a project is large or small. Small projects merit adequate supervision budget to leverage the potentially high impact of such operations which often test and validate important methodologies appropriate for scaling-up under much larger projects.

There are risks associated with recruiting a relatively inexperienced recipient such as the Candido Rondon Foundation at the outset of project execution, but the important institutional capital formation which occurred as a result of its major role in a complex Bank-supported operation was a valuable development.

Given the complexities of several government agencies managing and internalizing project resources, many government agencies in Brazil are using foundations and social organizations to facilitate the financial, administrative and procurement functions of projects.

The major obstacle for project coordination was the distance between the Coordinator's office, executing agencies in Mato Grosso do Sul, and field operations in Bonito.

Document Date: 2011/04/30.Document Type:Implementation Completion and Results Report.Report Number: 65549.Volume No: 1 of 1

Brazil-Formoso River Integrated Watershed Management and Protection Project