Govt to open US$1.2bn credit line for loss reduction under PAC II

Tuesday, March 8, 2011

Brazil's federal government plans to open up a 2bn-real (US$1.21bn) credit line to help states and municipalities reduce utilities' water losses under phase II of national growth acceleration program PAC.

Of the total amount, 1bn reais will come from state funds, and the remainder from federal unemployment insurance fund FGTS and workers' support fund FAT, Agência Estado reported.

"Our concern is not just with executing the works, but with sustainability and maintaining the current systems," said the cities ministry's environment and sanitation secretary Leodegar Tiscoski.

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The cities ministry is currently setting the eligibility criteria for receiving the funds.

"One of the variables in the selection process may be a high loss rate," Tiscoski said, adding that some utilities have recorded losses of up to 70%.

Brazil has an estimated loss rate of 43% across its water supply systems, BNamericas reported previously.