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The World Bank's Board of Executive Directors has approved a US$100 million loan to improve the working and living standards of dairy farmers in parts of Heilongjiang Province, northeast China.

 

The loan will also help local dairy farmers experiment with solutions to reduce greenhouse gas emissions from dairy farms, the bank said in a statement on Wednesday.

 

In Heilongjiang, 70 percent to 80 percent of milk is produced by smallholder households each raising an average two to five milk cows.

 

These small holders and other potential dairy households have little or no access to formal financing for investment in dairy production, said the statement.

 

The six-year Heilongjiang Dairy Project would address that problem by helping increase the scale, efficiency and quality of milk production in the province.

 

"This effort would also help improve the quality of the dairy herd by improving its genetic base," said the statement.

 

Mohamed Noureddine Ben Ali, lead operations officer for the World Bank, said this project aims to help rural farmers increase their incomes and gain more income security.

 

That is particularly important for poor households who have no cows and will now have the chance to dramatically improve their families' standards of living, he said.

 

The bank said a US$5.5 million grant from the Italian Trust Fund for Environment in China would help test innovative technologies to reduce greenhouse gas emissions and increase carbon sequestration from dairy farms.

 

The US$100 million loan from the International Bank for Reconstruction and Development is repayable in 20 years with a five-year grace period.

 

(Xinhua News Agency January 26, 2006)