International financial institutions

UNDP and the Inter-American Development Bank (IADB)

The Inter-American Development Bank was established in 1959 as a development institution with novel mandates and tools. Its lending and technical cooperation programs for economic and social development projects went far beyond the mere financing of economic projects that was customary at the time. It is the oldest and largest regional development bank and the main source of multilateral financing for economic, social and institutional development projects as well as trade and regional integration programs in Latin America and the Caribbean.

IADB helps foster sustainable economic and social development in Latin America and the Caribbean through its lending operations, leadership in regional initiatives, research and knowledge dissemination activities, institutes and programs. It assists its Latin American and Caribbean borrowing member countries in formulating development policies and provides financing and technical assistance to achieve environmentally sustainable economic growth and increase competitiveness, enhance social equity and fight poverty, modernize the state, and foster free trade and regional integration.

Public entities eligible to borrow from the Bank include national, provincial, state and municipal governments, and autonomous public institutions. Civil society organizations and private companies are also eligible. It provides loans, grants, guarantees, policy advice and technical assistance to the public and private sectors in its Latin American and Caribbean member countries.

The IADB promotes cofinancing arrangements by multilateral and bilateral institutions for its public sector projects. Over the past five years, these institutions have provided average annual cofinancing of $1.35 billion and also contributed technical expertise and know-how. Cofinancing can take various forms, including joint or parallel financing operations, grants for special events, external financing of counterpart requirements, and trust funds for technical cooperation. In recent years, the IDB has received cofinancing resources from more than 15 multilateral institutions, of which the World Bank group was the most important, and from some 20 bilateral agencies, mainly in Japan and Western Europe. The contribution of the multilateral institutions was around 85 percent of the total cofinancing flow.

UNDP and IADB signed an agreement on 14 November 1990 that identifies the following areas of cooperation - the improvement of services to low income countries and support to microproducers, the productive use and protection of the environment, macroeconomic and public sector management, institutional development, women in development, scientific and technological development, regional cooperation and integration and promotion of regional commerce.