WASHINGTON, (Reuters) – Latin America and the Caribbean are poised for stronger growth in coming years, buoyed by yesterday’s agreement by the United States, Canada and 10 countries to strengthen regional supply chains, the head of the Inter-American Development Bank said.
IDB President Ilan Goodfajn told Reuters the bank would play a big role in that growth after signing three new agreements with the U.S. in the areas of migration, biodiversity and steps to mobilize more private sector investments.
U.S. President Joe Biden and top officials from Barbados, Canada, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, Peru, Uruguay, Mexico and Panama on Friday pledged to deepen economic ties, with a big focus on migration, and supply chains for clean energy, medical supplies and semiconductors.
“This is an agreement that basically glues together the Americas – the U.S. with countries in Latin America and the Caribbean,” he said. “It’s the moment where you can seize the opportunity to change things.”
Friday’s agreement sent a “huge signal” to U.S. investors and others eyeing projects in the region, he said.
Goldfajn, a former IMF official who took over the helm of the IDB one year ago, said the region still faced many social, fiscal and climate challenges, but expanded cooperation and investment could help the region prosper – and help the world meet its needs for food, critical minerals and energy.
He said Latin America and the Caribbean produced 30% of their energy through renewables, double the global average, and was home to two-thirds of the world’s lithium and 38% of its copper. It also produces enough food to feed 1.3 billion people.
Friday’s agreement included $89 million for the IDB’s efforts to help countries address migration challenges, including $25 million from the U.S. and additional funds from Canada, South Korea and Spain and the IDB’s ordinary capital.
It also called for the U.S. International Defense Finance Corp and IBD Invest, the bank’s private-sector arm, to set up a new investment platform to finance large-scale strategic infrastructure projects in Latin America and the Caribbean.
Washington also announced a $10 million contribution to an IDB biodiversity grant facilty.
