New operation links fiscal sustainability and forest conservation in Amazonas

The World Bank has approved a new Development Policy Financing (DPF) operation named “AM Pro-Sustainability” in order to boost the environmental governance of the State of Amazonas (Brazil) by enhancing its fiscal sustainability, and mobilizing finance for forest conservation and a low-carbon bioeconomy.

The AM Pro-Sustainability program will include several measures: i) new laws to stimulate bioeconomy enterprises; ii) wildfire prevention and response systems will be upgraded; iii) change how state funds are distributed, rewarding municipalities that show stronger environmental results through performance-based transfers; iv) fiscal rules will be updated to slow the growth of current spending, freeing resources for green investments ; v) modernization of environmental agencies such as the Secretariat of Environment of Amazonas (SEMA) and the Amazonas Environmental Protection Institute (IPAAM).

In addition, the program will also introduce performance-based grants (worth 22 million dollar), from the World Bank’s Framework for Financial Incentives (FFI) to the Amazonas State, providing additional incentives to reduce deforestation over time and sustain environmental policies.