Rio State Fiscal Sustainability, Human Development and Competitiveness DPL

closed

This Fiscal Sustainability, Human Development, and Competitiveness Development Policy Loan Program is designed to assist the Government of the State of Rio de Janeiro (GORJ) in sustaining its strategic efforts to improve fiscal management, competitiveness and social service delivery in the context of a temporary fall in revenues associated with the recent global financial crisis and economic slowdown. Rio de Janeiro state and federal Government of Brazil requested a single-tranche stand-alone Development Policy Loan (DPL) to help with the projected 2010 financing needs deriving from reduced projected revenues, mainly due to lower oil royalties, state taxes and intergovernmental transfers and increased expenditures on infrastructure associated with the Program of Accelerated Growth (PAC). Although financing needs are related to the current global and financial crisis, the policies supported by the proposed DPL are part of GORJ's medium-term reform program. Specifically, the loan supports measures that: (a) strengthen fiscal consolidation through reduced long-term fiscal risk, improved efficiency of tax administration and strengthened budget procedures and financial management; (b) improve quality and efficiency of the business registration process; (c) increase quality and efficiency of the basic education system; and (d) increase access to and efficiency of health services, especially for urgent and emergency health care in disadvantaged areas and for low-income populations.