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March 23, 2011

Mozambique receives $70 million World Bank agriculture loan

The World Bank on Mach 17 approved an International Development Association (IDA) credit of US$70 million equivalent in support of the implementation of the Government of Mozambique's PROIRRI-Sustainable Irrigation Development Project.

While agriculture is essential in the country's development, its potential remains largely untapped. The sector features some of the lowest cereal yields in southern Africa. In addition, Mozambique ranks third amongst the African countries most exposed to risks from multiple weather-related hazards, mainly floods and droughts.

This project will seek to increase agricultural production marketed and raise farm productivity in new or improved irrigation schemes in the provinces of Sofala, Manica and Zambezia. It will provide direct support to smallholder farmers who will benefit from the adoption of: (i) improved production technologies and know-how related to irrigation; (ii) complementary technical skills required to harness the full potential of water for agriculture; (iii) improved post-harvest techniques; (iv) access to better performing extension and financial services; and (v) closer linkages with potential market opportunities.

"Sustaining agricultural growth and improving access to inland markets while tapping into regional and international agriculture markets are central to boosting food production, agricultural growth, rural poverty reduction, and lift up the whole economy," said Olivier Godron, Acting Country Director for Mozambique.

The project will improve the enabling agriculture environment, strengthen related institutions, and develop farmers' capacity in sustainable irrigation. It will also finance infrastructure required to increase productivity and profitability of irrigated smallholder agriculture, i.e. scheme development, tertiary roads and energy supply; and, finally, it will enhance agriculture production and support the development of value chains through access to finance. The project will also support the implementation of the country's new Irrigation Strategy as well as the development of a National Irrigation Program.

"PROIRRI will enable targeted producer groups to evolve towards formalized and bankable farmers associations with stronger links to the market and improved access to financial services from commercial banks. Over the course of the 6-year implementation period, PROIRRI is expected to directly benefit some 16,000 farmers across the central Mozambique provinces of Manica, Sofala and Zambezia," said Patrick VerĂ­ssimo, the project's Task Team Leader for the World Bank.

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