IDB and IDB Invest gain Board support on Vision 2025 and path toward capitalisation

THE Board of Governors of the Inter-American Development Bank (IDB) approved a resolution authorising the analytic work required to consider a potential capital increase, and overwhelmingly supported the IDB agenda, “Vision 2025”, for recovery and sustainable economic growth in Latin America and the Caribbean.

The developments occurred on the final day of the 61st Annual Meeting of the IDB and 35th Annual Meeting of IDB Invest (whose legal name is the Inter-American Investment Corporation), where the agenda focused on key themes such as the impact of the COVID-19 pandemic, climate change, economic empowerment of women, innovation, health needs and the role of the private sector.

President Iván Duque Márquez of Colombia reiterated the important role of the IDB for the region and the importance of taking action now to ensure it can respond to growing demand.

IDB President Mauricio Claver-Carone presided over his first Annual Meeting and outlined how the IDB Group in 2020 reached historic financing levels of nearly $24 billion for governments and firms in the region in response to COVID-19.

“I ask you to reinvest in us, so we can boldly reinvest in the Americas,” Claver-Carone said.

The IDB president reiterated the Bank’s efforts to support governments’ financing needs and $1 billion in assistance for negotiated access to vaccines.

“The region will have a committed partner to help countries face these historic challenges and be well-equipped with the needed financial resources to make a big difference,” he added.

“Vision 2025, Reinvest in the Americas” outlines five opportunities for the IDB Group to work with the region, including regional integration and strengthening value chains; support for small and medium-sized firms in order to narrow the estimated $1 trillion financing gap; promotion of a digital economy; and the prioritisation of gender and climate-change response.

James Scriven, CEO of IDB Invest, highlighted the private sector’s leading role in the economic recovery of the region, which must be green and inclusive. “There is a clear path to recovery in Latin America and the Caribbean: the private sector must be the engine of sustainable recovery.”

Governors supported the “Vision 2025” agenda that will guide the work of the Bank, as President Claver-Carone seeks to position the IDB Group as the partner of choice for Latin America and the Caribbean. During the meeting, PROSUR members also announced a Joint Statement reaffirming their commitment to ensure that the Bank mobilises the necessary resources to address the enormous challenges facing the region and supporting steps to ensure the IDB Group remains the main source of multilateral financing for Latin America and the Caribbean.

The week-long Annual Meeting concluded after the IDB Group announced key financing and new initiatives, which included a new initiative to bring sustainable development to the Amazon region, was unveiled during a seminar dedicated to exploring public and private investment opportunities for the countries of the Amazon. The initiative, which will have $20 million in seed capital from the IDB, will be implemented in close co-ordination with the Amazonian countries and the Amazon Co-operation Treaty Organisation (ACTO).

The IDB also launched its 2021 Macroeconomic Report, urging countries to enact key fiscal and institutional reforms to achieve more robust and sustainable post-COVID growth. Effective vaccination campaigns, together with a more favourable global economic environment and growth-enhancing reforms, could put the region on a path to recover most of its lost growth by 2022.

James Scriven, CEO of IDB Invest, and Irene Arias Hofman, CEO of IDB Lab, highlighted the catalytic role of the Group in attracting international investors to generate more impact; in managing large and complex projects; and in bringing in other partners to finance some of the most innovative, transformative, private sector-led projects in the region.

The IDB partnered with Accenture, Facebook, Mastercard, NEC, Visa and Walmart to launch “Women Growing Together in the Americas”, a program to support micro, small and medium-sized enterprises (MSMEs) led by women and to integrate their businesses into regional value chains and foreign trade.

A new, centralised development knowledge hub – #BIDAcademy – was launched, which digitally aggregates the knowledge base of the IDB Group and network of experts and specialists to provide the public with improved access to hundreds of courses and other knowledge and learning resources.

Also in the mix was that the Government of Korea and the IDB Group agreed to renew and expand the Korea Infrastructure Development Co-financing Facility for Latin America and the Caribbean (KIF) for an additional $500 million, its largest replenishment in the last five years.