Press release No.: IFAD/35/08

The Government of Panama, IFAD, OPEC and the participating rural communities will provide the total project cost, worth US$12.3 million. The project will last for six years.

Rome, July 15 2008. The Government of Panama is to implement a modernising and participative rural development project in the central region of the country, backed by an IFAD US$4.2 million loan.

The agreement was signed in Rome today by the Ambassador of Panama to IFAD, Eudoro Jaén Esquivel and the President of IFAD, Lennart Båge.

The project aims to improve the social and economic conditions of 10,000 men and women – the majority smallholder farmers, landless labourers, unemployed youth and female heads of household – whose annual income is less than US$953.

The project will cover the five poorest districts of Veraguas Province and will focus on promoting new income generating activities and identifying new national and international markets to sell the produce.

The project will be tailored to the different needs and capabilities that already exist amongst the beneficiary farmers. The poorest will receive basic inputs and technical assistance to increase productivity, according to their specific requirements. Those who are already on a better footing can move onto programmes of micro-credit and improvement of their entrepreneurial capabilities.

An innovative feature of the project is the “territorial development council” as the main decision-making body. Local government representatives, producers and organised groups from each community will take part in these “councils”. The long-term objective of these councils is to strengthen the rural social fabric to advance the process of administrative decentralisation in the country.

With this project, IFAD will have financed eight rural development and poverty eradication projects in Panama for a total of commitment of over US$ 80 million.

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IFAD was created 30 years ago to tackle rural poverty, a key consequence of the droughts and famines of the early 1970s. Since 1978, IFAD has invested more than US$10 billion in low-interest loans and grants that have helped over 300 million very poor rural women and men increase their incomes and provide for their families. IFAD is an international financial institution and a specialized United Nations agency. It is a global partnership of OECD, OPEC and other developing countries. Today, IFAD supports more than 200 programmes and projects in 81 developing countries and one territory.