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 São Paulo.
"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 $2 a day.
"It does have, I think, the most severe inequality of any region in the world except for sub-Saharan Africa."
He says it’s extremely important to understand the dimensions of poverty in the region and to understand how the Bank can help countries deal with the issue.
Bank Support
During his six day visit, Wolfowitz will have the chance to see firsthand a key element in the Bank’s support to help Brazil tackle poverty through the country’s flagship social program, Bolsa Família.
The program, which celebrated its second anniversary in October, is one of the largest of its kind in the world. Supported by a Bank loan of US$ 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 capital Brasília with President Luiz Inácio 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 Ceará in Brazil’s Northeast, 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 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.
Wolfowitz made the following statement upon his arrival in Brazil.
"This is my first visit to Latin America as President of the World Bank and my first visit to Brazil. I am delighted to begin my immersion in the region by visiting Brazil, an economic giant, a major global and regional actor, and a country whose great richness and diversity are such an important part of the even greater richness and diversity of the Latin American region as a whole.
"Over the next few days, I will be traveling to different parts of the country to see for myself both Brazil’s achievements and its challenges. I will be meeting President Lula and Finance Minister Palocci this afternoon to hear more from them on the steps the Government has taken to maintain economic stability and growth, while focusing on social issues. I also want to hear their views of Brazil’s relationship with the World Bank Group and how we can strengthen that partnership.
"During my visit I hope to learn about the efforts Brazil is making to promote inclusive growth and reduce entrenched inequality. Throughout Latin America, there is an urgent need to create equality of opportunities for the poor, not only to improve their lives, but also to increase their ability to contribute to the economy and to society. Programs that directly target the poor such as Bolsa Família – which can serve as a model for other countries – are of special interest.
"Brazil is a major exporter of industrial, technological and agricultural products, ranging from soybeans to aircraft. This has given it a leading role as one of the most important emerging economies in the global trade debate.
"Sound management of natural resources and the environment have emerged as a key concern for the World Bank in the 21st century and Brazil – by its sheer size, richness and abundance of its natural resources- is a key player in promoting environmental sustainability in this area. Together, we have an opportunity to advance the energy and development dialogue as we seek innovative uses for emerging technologies.
"I will be visiting local communities in the Amazon, in the Tapajós and Santarém region, where a number of creative experiences are taking place in the area of community-driven development. This is a path to growth and prosperity that is friendly to the environment and inclusive of those who have historically been left behind, such as women, youth, and indigenous groups.
"Like other middle-income countries in Latin America, Brazil faces the challenge of enabling the poorest of its people to enjoy the opportunities that it success increasingly brings to the more fortunate of its people.
"With 25 percent of the population of Latin America still living in poverty, overcoming poverty remains a major challenge for Brazil and other middle-income countries, a challenge the World Bank Group is committed to working on."
World Bank – www.worldbank.org