World Bank Lends Brazil US$ 500 Million for Popular Housing

The World Bank Board of Executive Directors today approved a US$ 502.5 million Programmatic Loan for Sustainable Growth: Housing Sector Reform for Brazil.

The loan supports initiatives already completed under Brazil’s reform agenda for sustainable and equitable growth with a focus on the housing sector.


Continuing urban growth, persisting income inequality and absence of targeted housing policies have led to a situation where more than 60% of households in Brazil are unable to find affordable homes.


The Brazilian Government is committed to a low-income housing strategy to improve the living conditions of the poor and strengthen their access to housing and serviced or serviceable land, and to expand new housing construction in the formal housing market, while maintaining fiscal discipline.


“Shelter for the poor remains a crucial part of Brazil’s agenda for socioeconomic progress,” said Vinod Thomas, World Bank Brazil Country Director.


“The Government’s commitment in this respect is reflected by its program for the provision of low-income housing and the development of a housing market, which are supported by this loan from the World Bank.”


The Government’s agenda includes efforts to:
develop a sound national policy and institutional framework for housing and urban development; strengthen the housing credit and savings systems, and provide incentives for the housing finance market to expand; reform the existing federal housing subsidy system to increase the affordability of housing solutions for the lower income groups, and make subsidies more transparent and efficient; and reduce the costs of formal urban land development by strengthening land legislation and regulations and real property registries and rights so as to increase the supply of serviced and serviceable land.


The overall impact of the program will be felt in increased access to housing finance, release of private savings which have been tied up in excessive down payments and high housing costs, and improved competitiveness among financial agents.


It will also impact fiscal sustainability by improving the targeting and transparency of housing subsidies and coordination with local governments and private agents.


Major achievements in the government’s reforms so far include the creation of a sophisticated legal framework for new mortgage-backed securities and mortgage bond markets, including mortgage-backed instruments, and the approval of legislation (Law 10.931 of 2004) which strengthens the trust of credit institutions in housing finance instruments and legalizes secondary market products such as mortgage bonds.


This IBRD fixed-spread US dollar loan has a repayment period of 17 years including five years of grace.


Brazil World Bank – www.worldbank.org.br

Tags:

You May Also Like

Brazil Opposition Wants OAS Mission to Check on Venezuela’s Political Prisoners

Venezuela will have to wait a little longer for Brazilian approval to get inside ...

Currencies Swap Agreement Between Brazil and Argentina Postponed to August

Brazil and Argentina postponed the signing of a US$ 1.8 billion swap agreement that ...

WEG, Brazilian Engine Maker Multinational, to Boost Exports by 40%

WEG, a Brazilian multinational that is the largest producer of electric engines in Latin ...

Brazil Proud to Go from IMF Borrower to IMF Lender

Brazilian President Luiz Inácio Lula da Silva said he wants to be the first ...

Brazilian Air Controllers Want Militaries Out and Dozens of New Staff

For a week now Brazilians are facing 40-minute to 4-hour delays in all their ...

Agriculture Represents 36% of All Brazilian Exports

2008 was excellent for Brazil in foreign trade of agribusiness products. Sector exports reached ...

In Africa, Lula Gets Backing of Cameroon for Brazil’s UN Ambitions

President Lula left this morning to Nigeria, the second stop of his African trip, ...

Vital Attraction

Drawn to movies since childhood it seemed inevitable that Mineiro Elton Eloin would end ...

God Is Brazilian, But Oil Rigs in Brazil Are Not Doing Their Job

Just one day after Brazil's President Luiz Inácio Lula da Silva said that "God ...

Brazil’s Ports Still Not Prepared Against Terrorism

Security norms are becoming increasingly rigorous worldwide, both for passengers and cargo, and there ...