– Estimated $12.9 Billion spent
The Inter-American Development Bank (IDB) approved a record number of 170 projects in 2010 totaling an estimated $12.9 Billion, as the entity continues to boost its efforts to help the Caribbean and Latin American combat poverty and inequality, and promote sustainable growth.
According to a release, this is up from 165 projects totaling $15.9 billion in 2009, when the IDB expanded its lending in the face of the global financial crisis.
The region’s countries have largely recovered during 2010, with the percentage of people below the poverty line falling to 31.9 percent of the population, against 33.1 percent the previous year and 44 percent in 2002. However, 180 million Latin American and Caribbean individuals are still considered poor.
Around a third of the IDB’s loan approvals in 2010 were for the region’s 19 smallest economies.
The IDB’s performance in 2010 reflects a strong increase in demand from its borrowing members over the past decade. Average annual approvals have risen from $6.2 billion for 2001-2005 to nearly $11 billion for 2006-2010.
By year-end, the IDB expects to disburse around $10.9 billion. Although this is also below the exception disbursements of 2009, disbursements continue the growth trend with respect to pre-crisis levels. Overall, net flow of loans to the region will have reached around $4.7 billion in 2010, with the poorest countries receiving an estimated $1.9 billion in disbursements.
Approvals of non-reimbursable technical cooperations also continued to grow last year, totaling an estimated $512 million, or 41 percent more than in 2009.
In his year-end report to the Bank’s Board of Executive Directors, IDB President Luis Alberto Moreno underscored that despite the devastation caused by the earthquakes in Haiti and Chile and other natural disasters that hit Guatemala, Colombia, Ecuador, Venezuela and Brazil, the region largely succeeded in navigating the effects of financial crisis.
“At year-end 2010, growth projections for Latin America and the Caribbean are better than for developed economies,” Moreno said. “Financial, monetary and fiscal institutions are much sounder than two decades ago. Natural resources in demand around the world are abundant in our region and social policy has made great strides through the use of increasingly effective tools.”
Moreno also underscored the growing solidity of the region’s fiscal and political institutions.
“The region’s economic policy landscape shows governments of different stripes that have adopted effective macroeconomic policies in a very pragmatic way.”
He added that despite these achievements, Latin America and the Caribbean must tackle numerous development challenges in areas including social equity, education, productivity, integration, food security and adaptation to climate change.
He thanked the Bank’s Governors for approving a historic capital increase earlier this year that will enable the IDB to better assist member governments in these areas.
“The Bank is now of a size consistent with the development needs of our member countries, with governance that ensures the efficient use of contributors’ resources, a greater ability to meet the needs of the poorest sectors, and the right tools to address the region’s challenges.”
According to the terms of the capital increase approved by the IDB’s Governors in Cancún, Mexico, last March, the Bank’s borrowing capital will increase from $101 billion to $171 billion over the next five years.
President Moreno also highlighted the IDB’s response to Haiti’s needs in the wake of the January 12 earthquake. In addition to cancelling Haiti’s debt to the Bank’s Fund for Special Operations in the amount of $484 million, the IDB approved $251 million in new grants for Haiti and expects to disburse $176 million by year end. These resources were channeled to critical programs in education, transportation, energy, finance and water and sanitation.
“Looking ahead, we have an intense agenda and great responsibility to the region,” Moreno said. “We are committed to stepping up support to the smallest and least developed countries and to providing exceptional support to Haiti.”
For the coming years, Moreno said the IDB has also set ambitious targets to support the reduction of poverty and inequity, adaptation to climate change, environmental sustainability, renewable energy, regional integration, productivity and private sector competitiveness and sustainable cities.
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