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Functional Cooperation

At times, actions by individual countries work better if coordinated with other nations. The IDB works with member countries to identify these opportunities, which are known as functional cooperation, and encourage countries to act collectively for maximum development results. This may involve finding the best way to tap a shared water resource, or ensuring countries jointly plan for natural disasters. The Bank supports this functional cooperation for integration through the Regional Public Goods Iniciative and South-South Cooperation, among others.

Objective

The IDB aims to support national, transnational and inter-regional operations to achieve a common development goal in any given sector. It achieves this objective through the production of regional public goods or South-South cooperation that can add value to a national intervention.

Why investing in functional cooperation?

Acting collectively to coordinate national interventions helps create collective policies beyond trade integration. Countries can achieve

  • a greater voice in global negotiations in forums such as the G20. Many global public goods are negotiated globally such as a balanced international financial architecture, a rules-based multilateral trading system, or a sustainable framework on climate change;
  • a platform to provide regional public goods (RPGs): regional integration provides incentives for jointly providing regional public goods such as macroeconomic stabilization or infrastructure initiatives; and
  • reduced asymmetries and increased cohesion: as global and regional integration may produce social and regional disparities, regional policy coordination may reduce these effects.

How does the Bank invest in functional cooperation for integration?

The Bank focuses on supporting Regional Public Goods projects in areas where regional collective action adds value to national interventions and where the Bank has a comparative advantage.

For additional information Regional Public Goods Program

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