Wolfowitz Arrives in Brazil

A visit which takes the World Bank president from the slums of Sao Paolo to education and family projects in Brasilia, and to local communities in the heart of the Amazon.

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December 15, 2005 — World Bank President Paul Wolfowitz has arrived in Brazil – a country which he describes as an economic giant and major global player.

Wolfowitz says the visit – his first to Brazil since taking over the presidency of the Bank – will help him understand the richness and diversity of the Latin America region.

“In Brazil, I will be traveling to different parts of the country to see both Brazil’s achievements and the challenges that the country faces which are not dissimilar to those of other big countries in the region,” Wolfowitz says

The Bank president will come face to face with one of Brazil’s major challenges within hours of stepping foot in the country – a visit to the favelas or urban slums of Sao Paolo.

“This underscores the challenge for Brazil and most Latin American countries. It’s the challenge of dealing with extreme poverty,” Wolfowitz says.

“Something like 10 percent of the population of Latin America lives on less than a dollar a day – what we define as extreme poverty. “

Wolfowitz says about 25 percent of the population in the region lives on less than $2 a day.

“It does have, I think, the most severe inequality of any region in the world except for sub-Saharan Africa. “

He says it’s extremely important to understand the dimensions of poverty in the region and to understand how the Bank can help countries deal with the issue.
                                                                                                        
Bank Support

During his six day visit, Wolfowitz will have the chance to see firsthand a key element in the Bank’s support to help Brazil tackle poverty through the country’s flagship social program, Bolsa Familia.

The program, which celebrated its second anniversary in October, is one of the largest of its kind in the world. Supported by a Bank loan of US$572.2 million, the program aims to improve the living conditions for eight million poor families throughout Brazil.  The government hopes to achieve universal coverage – helping some 11.2 million families – by 2006.

Wolfowitz will meet poor families who are supported by the scheme – which gives the families cash grants on the condition they send their children to school and health facilities.

“Brazil is one of the countries which has pioneered in this area and it’s something I think has potential application as far afield as Indonesia, which is experimenting with something along similar lines,”Wolfowitz says.
 
It’s just one of some 50 active Bank projects now in Brazil, worth US$4.2 billion.

Prior to his arrival Wolfowitz described Brazil as “one of the most important countries in the developing world.”

“In fact, very importantly, it’s one of the countries we call the middle income countries that have increasingly developed the capacity to do a great deal for themselves, which is some respects, is a challenge for this institution to figure out what our place is, in a picture where our role is smaller but still important,” he says.

“I really want to underscore the Bank’s commitment to Brazil and to all other middle income countries in Latin America, because there’s such a high number of the world’s poor people who live there. While there has been a lot of success in the last few decades, there’s a lot more to be done and I want to make sure this institution is doing everything it can to assist.”

Trade Round

The president’s visit takes place as trade ministers from around the world meet in Hong Kong for the latest round of trade talks on the Doha development round.

It’s a point acknowledged by Wolfowitz, who says he’s keen to understand the country’s perspective on the trade issue and to see “what we can possibly do to help move forward the global trade agenda.”

 “And as a major exporter of industrial, technological products and agricultural products – from soybeans to aircraft – Brazil has taken on a leading role in representing other emerging economies in the global trade debate.”

During his visit, Wolfowitz will meet in Brasilia with President Luiz Inacio “Lula” da Silva, and Finance Minister Antonio Palocci to also hear about the steps the government has taken to maintain economic stability and growth, while focusing on social issues.

“It’s impressive to me in how many areas Brazil is mentioned as a leader – in area of climate change, HIV/AIDS, renewable energy, trade, community driven initiatives, education, health and infrastructure. These are all areas which I think are very important things for us to be learning what Brazil has done,” Wolfowitz says.

Environment and Development

The Bank president will also visit communities in the state of Ceara in Brazil’s north east, the poorest region in the country, where the Bank has been supporting several community-driven development initiatives. And in the Amazon area, Wolfowitz will go to various projects seeking a balance between environmental conservation and economic development.
 
Wolfowitz signaled climate change would be a key issue during this visit.

“Climate change is a key concern for the world this century. By its sheer size, its richness and the abundance of its natural resources, Brazil is a key player in that area. And, it’s also like other rapidly developing middle income countries, a big consumer of energy and so that I think will definitely be something to be talking about and learning about.”

  “Brazil is one of nine countries but the biggest country which hosts the extraordinary treasure of the Amazon, which is both a national treasure for Brazil, but also something that is an asset in many, many ways to the global community.

“And I think the whole world has an interest in helping Brazil manage those resources. I’m basically an optimist. I think it can be done in a way that both maximizes the contribution to development and manages the environment successfully. But it’s a big challenge.”

The Amazon – called the last great wilderness on earth – has almost 40 percent of all the tropical rainforests left in the world, and is home is to more than one third of all natural species on the globe.

 The Bank has been helping Brazil manage the fine balance between development and preservation as trustee of the rain forest trust fund worth US$73 million which supports the Pilot Program to Conserve the Brazilian Rainforest, with total funds of US$428 million.  The program has demarcated 45.5 million hectares of indigenous lands, and established more than 2.1 million hectares of community managed extractive reserves. It’s also sponsored more than 200 community projects which experiment with new ways to conserve the rain forest and use the natural resources in a sustainable way.

Wolfowitz will visit some of those community projects during his visit to the Amazon, including watching local people extract latex from rubber trees and producing products made from latex leather, such as purses and bags. 

During his trip, the Bank president will also meet civil society representatives, groups of women, as well as the indigenous peoples, youth leaders and local authorities.