IDB Chief Goldfajn Sees Latin America and the Caribbean Poised for Stronger Growth, According to Reuters

By Andrea Shalal

WASHINGTON – Latin America and the Caribbean are set to experience stronger growth in the coming years, thanks to a recent agreement among the United States, Canada, and ten other countries aimed at enhancing regional supply chains, according to the head of the Inter-American Development Bank (IDB).

IDB President Ilan Goldfajn mentioned that the bank would play a significant role in this growth following the signing of three new agreements with the U.S. that focus on migration, biodiversity, and increasing private sector investment.

On Friday, U.S. President Joe Biden, along with officials from Barbados, Canada, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, Peru, Uruguay, Mexico, and Panama, committed to strengthening economic ties, particularly in relation to migration and supply chains for clean energy, medical supplies, and semiconductors.

“This agreement effectively connects the Americas, linking the U.S. with Latin American and Caribbean nations,” Goldfajn stated. “Now is the time to seize the opportunity for change.”

The agreement has sent a strong signal to U.S. investors and others considering projects in the region, he added.

Goldfajn, who previously served at the IMF and took charge of the IDB a year ago, acknowledged that the region still faces numerous social, fiscal, and climate challenges. However, he believes that increased cooperation and investment could lead to prosperity in the region while addressing global demands for food, critical minerals, and energy.

He highlighted that Latin America and the Caribbean generate 30% of their energy from renewable sources, which is double the global average. The region also holds two-thirds of the world’s lithium and produces sufficient food to feed 1.3 billion people.

The agreement includes an allocation of $89 million for the IDB’s initiatives to tackle migration challenges, which encompasses $25 million from the U.S. and additional contributions from Canada, South Korea, Spain, and the IDB’s own capital.

Additionally, it calls for the U.S. International Development Finance Corporation and IDB Invest, the bank’s private-sector division, to establish a new investment platform aimed at financing large-scale strategic infrastructure projects in Latin America and the Caribbean.

Furthermore, Washington announced a $10 million contribution to an IDB biodiversity grant facility.