CLIMATE EMERGENCY

IDB announces BRL 5.5 billion for climate tragedy in Southern Brasil

Efforts towards the recovery of Brasil's Rio Grande do Sul state are aligned with the agreement among 10 multilateral banks to increase engagement in combating climate change. The Inter-American Development Bank is working alongside the Brazilian presidency of the G20 on the Finance Track and contributing to initiatives of the Task Force on hunger relief.

05/09/2024 5:45 PM - Modified 19 days ago
People rescued from the heavy rains in the Santa Maria Air Base, Rio Grande do Sul. | Photo: Ricardo Stuckert /PR
People rescued from the heavy rains in the Santa Maria Air Base, Rio Grande do Sul. | Photo: Ricardo Stuckert /PR

A total of BRL 5.5 billion from the Inter-American Development Bank (IDB) will be destined for employment protection, support for small and medium-sized enterprises, and infrastructure projects for the reconstruction of the cities devastated by the heavy rains in the Brazilian state of Rio Grande do Sul. The announcement was made by Ilan Goldfajn, president of the bank, in Brasilia this Thursday (09). 

According to Goldfajn, BRL 1.5 billion has already been secured and can be accessed through direct loans. The funds come from newly negotiated contracts with expedited procedures to address the humanitarian emergency in southern Brasil, focusing on projects supporting micro and small businesses and providing immediate aid. Another BRL 4 billion are from credit lines for future negotiations, aimed at the reconstruction of resilient infrastructure. These funds will also have simplified access processes for actions in the state, assured the banker.

"It is an unprecedented tragedy, leaving hundreds of thousands without electricity, shelter, water, and access to roads, with infrastructure heavily impacted. Yet another disaster, but sadly, we have witnessed similar situations across Latin America. The IDB stands ready to aid not only with this package of measures but also with technical knowledge in crafting resilient projects and conducting studies and proposals to confront this situation," stated Ilan. He also disclosed a donation of BRL 3 million for humanitarian assistance to the affected state in Brasil.

Ilan Goldfajn, president of the Inter-American Development Bank (IDB), announced BRL 5.5 billion in investments to recover the Brazilian state of Rio Grande do Sul | Photo: Marcelo Camargo/Agência Brasil
Ilan Goldfajn, president of the Inter-American Development Bank (IDB), announced BRL 5.5 billion in investments to recover the Brazilian state of Rio Grande do Sul | Photo: Marcelo Camargo/Agência Brasil

MDBs in the fight against climate change

In April, leaders from 10 Multilateral Development Banks (MDBs) announced joint measures to improve work effective as a system and to increase impact and scale of their work to face pressing development challenges. The measure is in alignment with the priorities of Brasil’s G20 Presidency discussed in the context of the Finance Track’s Financial Architecture working group.  

In a document released by the MDBs, these leaders stated their commitment to tangible actions in five critical areas, emphasizing collaborative efforts to combat climate change through adaptation and mitigation, climate finance, and the enhancement of early warning systems for natural disasters.

“There is a need to increase climate financing for resilient projects encompassing both physical and financial infrastructure. For instance, we are developing a range of instruments. In the event of a disaster, you can access the available funds immediately without incurring any fees,” Goldfajn explained. "There are various financial mechanisms geared towards boosting climate financing and directing more funds towards building resilience through adaptation," he concluded. 

The IDB presides over the multilateral development banks in the region and actively participates in the initiatives proposed by the Brazilian G20 Presidency through the Task Force against Hunger and Poverty and the Finance Track, in actions towards the reform of global governance and financial institutions. 

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