UN agency to promote profitable rural smallholder enterprises in Paraguay

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UN agency to promote profitable rural smallholder enterprises in Paraguay

The International Fund for Agricultural Development (IFAD) presented its new seven-year strategy for Paraguay today, focusing on building the resilience of smallholder farmers to climate change and strengthening poor rural people’s organizations so that they can set up profitable rural enterprises.

The Country Strategic Opportunity Programme, approved by IFAD’s Executive Board, will directly benefit 55,000 poor rural families in Paraguay. The strategy results from a comprehensive consultation process with all stakeholders.

“Setting up profitable rural enterprises will benefit not only smallholder farmers, but the whole country. Only small farmers can guarantee Paraguay’s food security and a wealthy agricultural sector,” said Claus Reiner, IFAD’s Country Programme Manager for Paraguay.

Over the past decade, Paraguay’s economy has experienced significant growth, mostly thanks to the agriculture and livestock sector. More than 75 per cent of Paraguay’s export income comes from agricultural products and its by-products.

Despite the great importance of agriculture for the country, Paraguay’s poor rural people still suffer the consequences of many years of neglect. At 32 per cent, the rural poverty rate is much higher than the national average.

“To reverse this situation, poor rural people have to be empowered and given the tools they need to thrive and to develop their capacities. This can be done by strengthening rural organizations,” said Reiner.

Thus, IFAD-funded operations in the country will focus on building the capacity of rural organizations to provide technical and financial services to their members. Training and funding will allow the use of technology in agricultural production, paying special attention to developing strategies and tools that allow Paraguay’s poor rural people to adapt to climate change and mitigate its negative effects.

Paraguay’s environmental situation is dire and badly affects smallholder farmers. Deforestation rates in the Western Region of Paraguay are among the highest in the world; agribusiness puts great pressure on natural resources, and in the north and north-east temperatures are raising and precipitation declining.

“Across the country, the soils managed by smallholder farmers are deteriorating. Unless we act and change agriculture practices, smallholders’ agriculture has little future in the country,” declared Reiner.

IFAD’s ultimate goal in Paraguay is to boost smallholder farmers’ capacity to set up profitable rural enterprises, have access to markets and national and international value chains and facilitate access to formal financial systems, including credit and insurance.

This is in line with the government's National Development Plan which focuses on increasing social and productive investment in rural areas.

“This new strategy reinforces and renews IFAD’s long-term partnership with the Paraguayan authorities to fight poverty and hunger and to pave the way for an inclusive, sustainable rural transformation,” said Reiner.

Note to editors:

  • Since 1979, IFAD has financed eight projects in Paraguay for a total of US$ 228.8 million, of which $ 88.1 million came directly from IFAD. These investments have benefitted over 88,000 households across the country so far.
  • Claus Reiner, IFAD’s Country Programme Manager for Paraguay, is available for interviews.

Press release No.: IFAD/88/2015

The International Fund for Agricultural Development (IFAD) invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience. Since 1978, we have provided nearly US$17 billion in grants and low-interest loans to projects that have reached about 453 million people. IFAD is an international financial institution and a specialized United Nations agency based in Rome – the UN's food and agriculture hub.