The World Bank's Board of Directors announced its approval of a financial package on March 27, 2025, aimed at reinforcing fiscal and environmental governance in Alagoas, Brazil. This package, valued at JPY41,623 million (US$277.4 million equivalent), is titled "Brazil State of Alagoas Sustainable Development Policy Loan." Its objective is to enhance the management of public and environmental resources and to improve climate resilience in one of Brazil’s vulnerable regions.
Alagoas is a region facing severe socio-economic issues, with 38% of its population living below the poverty line in 2023. Particularly among children aged 0 to 14 years, the poverty rate has been recorded at 59%. The state is also challenged by environmental issues, including high rates of deforestation, soil degradation, and scarcity of water resources. This newly approved financing targets the implementation of vital fiscal and environmental reforms, alongside expanded investment in infrastructure and public services, primarily benefiting the impoverished demographic.
Johannes Zutt, the World Bank Country Director for Brazil, stated, “The World Bank is proud to support Alagoas in building a more sustainable and resilient future. This project will strengthen the state’s fiscal governance while advancing innovative environmental policies that benefit both the local population and the economy.”
Project objectives are set to enhance public services, with a focus on improving healthcare, education, and sanitation, particularly for underprivileged communities. This effort aligns with the Alagoas government's Multi-Year Plan for 2024-2027, facilitating fiscal reforms and increased public investment. The project also aims to alleviate poverty by directly enhancing services crucial for the vulnerable population, including social protection and housing.
Other significant goals include promoting sustainable fiscal management and optimizing public resource governance. The project seeks to enhance environmental and climate strategies, strengthen regulations for biodiversity conservation, and implement climate adaptation initiatives.
These improvements echo the goals of Brazil’s 2024-2027 Multi-Year Plan and align with the World Bank’s Country Partnership Framework, targeting sustainable economic growth and environmental conservation in Brazil.
By executing these reforms, Alagoas aims to pave the way for a more inclusive, sustainable future, enhancing the quality of life for its residents and increasing resilience against economic and climate adversities.