Introduction

The IDB Group is comprised of three institutions.

Inter-American Development Bank

The IDB was established in 1959 and is the oldest and largest of the regional development banks. Cumulative IDB lending to Latin America and the Caribbean totals more than $160 billion, with the volume of annual loan approvals in recent years ranging from $6 billion to $9 billion. The IDB today is the main source of multilateral financing for economic, social and institutional development in Latin America and the Caribbean, as well as for regional integration. It provides loans, grants, guarantees, policy advice and technical assistance to the public and private sectors throughout the region.

The IDB is owned by 47 member countries, of which 26 are borrowing countries in Latin America and the Caribbean. Initially a partnership between 19 Latin American countries and the United States, the Bank expanded its membership over several decades to the English-speaking Caribbean countries, Canada and Suriname in the Western Hemisphere, and to 16 European countries, Israel, the Republic of Korea and Japan, and most recently, China. The Bank’s headquarters is located in Washington, D.C. It has offices in the capital of each of its borrowing member countries and in Paris and Tokyo.

Inter-American Investment Corporation

The Inter-American Investment Corporation (IIC) is a multilateral financial institution created in 1989 to promote economic development by encouraging the establishment, expansion and modernization of small and medium-sized private enterprises in Latin America and the Caribbean. There are 43 member countries, of which 26 are in Latin America or the Caribbean. Although the IIC is part of the IDB Group, it is legally autonomous and its capital, corporate governance, resources and management are separate from those of the IDB.

To fulfill its mandate, the IIC finances private enterprises, preferably those that are small or medium-sized. The IIC offers a range of financial products and services, either directly through long-term loans, guarantees, equity investments and issue underwritings, or indirectly through lines of credit through local financial intermediaries that provide funding for investments, refinancing, working capital, guarantee facilities, and financial and operating-lease facilities.

Multilateral Investment Fund

The Multilateral Investment Fund (MIF), established in 1993 under IDB administration, plays an essential role in poverty reduction and economic growth, leveraging increased private invest- ment and advancing private sector development in Latin America and the Caribbean. The MIF focuses on small, targeted projects that stimulate improvements in the business environment, strengthen the capacity of microand small enterprises to benefit from market change, and engage the private sector in the development process. It is governed by a committee representing its 38 donor member countries (including five new member countries joining as members of MIF II).

MIF projects promote innovation, test new approaches to strengthen competitiveness, demonstrate possibilities to commercial markets, and advance difficult reform issues. To enable other development instruments and markets to adopt approaches that work effectively, the MIF shares the results of its experience in fields such as remittances, microfinance, environmental management, skills and quality standards and credentialing systems, regulatory reform to promote private investment, venture capital market development, alternative dispute resolution, and quality management systems (ISO). Primarily a grant facility, the MIF also uses an array of loan, quasi-equity and investment mechanisms to achieve specific development objectives.