The Inter-American Development Bank approved a $20 million loan for an agricultural competitiveness program in Peru that seeks to make small and medium-scale agricultural producers more competitive and responsive to supply capacities.
The program is the first of three programmatic policy-based loans to support Peru in implementing a new agricultural policy framework introduced in June 2008. The framework is intended to increase the sector's long-term competitiveness so as to maximize the agricultural benefits deriving from present and future trade agreements.
The program will support policies and management initiatives to strengthen four priority areas: the adoption of new technologies by associations of small and medium-scale farmers; the development of clusters and agricultural value chains; efficient mechanisms for agricultural innovation; and access to agricultural information for use in market and policy decision making.
These policies and initiatives have been grouped into components. The first component seeks to ensure that the macroeconomic framework is consistent with the program objectives.
Another component consists of implementing a Competitiveness Incentive Program that includes an effective mechanism to track spending, objectives and results, in particular in relation to the adoption of new and environmentally sound agricultural technologies.
A development component of agricultural clusters and value chains will support the strategic and policy groundwork in the Ministry of Agriculture to establish agricultural value chains and capacity building. Other components deal with agrarian innovation and improving agricultural statistics.
This 20-year loan will be executed by Peru's Ministry of Finance.
Inter-American Development Bank