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            BANK NEWS RELEASE NO. 76/44                                           APRIL 29, 1976

                          BRAZIL BORROWS $40 MILLION FOR AGRICULTURAL RESEARCH


                     Brazil will implement a $189 million agricultural research proj-
           ect with the assistance of a World Bank loan of $40 million.

                      The project is designed to strengthen, over a five-year period,
           the agricultural research capability of Enoresa Brasi leira de Pesquisa Agro-
           pecuaria (EMBRAPA), the Government-owned a~ricultural rese~rch corporation,
           established in 1972. It will provide for a program of agrobiological re-
           search aimed at accelerating the production of rice, maize/sorghum, cassa-
           va, cotton, beans, rubber, dairy cattle, beef cattle and sheep/goats. The
           project will be concentrated in three areas, namely: a) the densely po-
           pulated, but agriculturally poor, northeast, where periodic droughts creat~
           acute social and economic problems; b) the north (Amazonia), where there



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           is 1 imited knowledge of the agricultural potential; and c) the central-
           west, or Campos Cerrados, which is being rapidly opened to settlement .
           Research will give special emphasis to crops and farming systems suitable
           for small farmers.

                     The overall objective of the project is the development of new
           technology suitable for adoption by large numbers of farmers. Two types
           of research program will be supported under the project--one type will deal
           with commodities and the other with farming-systems. The project includes
           construction and development of research laboratories and field facilities
           at three agricultural research centers, eight national commodity centers
           and 14 state experiment stations.

                     Most of the rural population in the three areas are relatively
           poor. About 65% of the farm holdings, or some 1.6 million farms, are of
           less than 10 hectares. The per capita income of these families is esti-
           mated around $225 per year, or less than a third of Brazil 1 s per capita
           income. The project is expected to lay the basis for substantial improve-
           ments in the living conditions o~ this segment. It will also strengthen
           the national economy as a whole by providing the means for import sub-
           stitution and for expanding exports.

                     EMBRAPA, Palacio do Desenvolvimento, Setor Bancario Norte,
           Brasilia, D.F., Brasil will have primary responsibility for the execution
           of the project. The Bank loan to Brazil is for 20 years, including 5
           years of grace. It wi 11 carry interest at 8-!-% per annum .


•          Note:    Money figures are expressed in U.S. dollar equivalents.