March 2001

BACKGROUNDER: THE IDB AND CHILE

IDB TO HOLD ANNUAL MEETING IN SANTIAGO, CHILE, MARCH 19-21

Chile at the vanguard of development with pioneering programs

The Inter-American Development Bank will hold its 42^nd Annual Meeting in Santiago, Chile, March 19-21, to review the Bank’s annual report, evaluate the institution’s lending programs, and discuss new policies and initiatives.

Chile is one of the founding members of the IDB, and Chilean economist and lawyer Felipe Herrera served as the Bank’s first president from 1960 to 1971.

From 1961 to 2000 the Bank approved 120 loans for Chile for a total of $4.616 billion. The loans financed investments in agriculture and forestry, industry, urban development and housing, energy, transportation, communications, education, as well as in social sector projects and microenterprise.

Chile has been in the vanguard of pioneering development programs. The first IDB private sector credit guarantee was approved by the Bank during 2000 to help finance the upgrading of the Santiago-Valparaiso toll road. The $75 million guarantee is also designed to promote local currency financial operations and offer an avenue for pension fund investments.

The first IDB telecommunications operation of the Bank’s Private Sector Department benefited southern Chile with a $25 million loan to Comunicación y Telefonía Rural.

Chile has participated in all the capital increases of the Bank and presently holds 2.953 percent of the capital. The country has contributed to the Fund for Special Operations, which provides concessional loans to the least developed countries of the region. Chile has also participated in the creation and financing of the Inter-American Investment Corporation and the Multilateral Investment Fund.

The IDB Annual Meeting will be preceded by 15 official seminars as well as numerous other activities that will be attract thousands of officials from the public and private sectors, special guests and journalists, as well as the official delegations of the Bank’s 46 member countries, with the presence of several presidents and former presidents of countries in the region.

The IDB Annual Meeting for 2001 is the second to take place in Santiago, Chile. The first was held there in 1974.

The IDB was created in 1959 to help accelerate the economic and social development of Latin America and the Caribbean. For the past seven years the Bank has been the leading source of development financing to the region. The IDB opened an office in Chile in 1965.