37th Meeting of Governors of the Central American Isthmus and the Dominican Republic in Guatemala

(Speech as prepared for delivery, translated from the original Spanish)

His Excellency Mr. Bernardo Arévalo, President of the Republic of Guatemala;

Distinguished Governors and Heads of Delegation;  

Members of participating Delegations;  

Executive Directors of the Inter-American Development Bank and IDB Invest;  

Colleagues from the IDB, IDB Invest and IDB Lab;  

Ladies and gentlemen, friends: 

It is a pleasure to be in Guatemala, and especially in the beautiful city of Antigua, on my first visit to the country as president of the IDB. 

Guatemala is known as "the land of eternal spring," and if anyone needs proof, they will find it here, in what was the ancient capital of this beautiful country, where flowers seem to grow in every corner one looks. 

I especially want to thank President Bernardo Arévalo and the Guatemalan authorities for being here and for hosting this 37th Annual Meeting of Governors of the Central American Isthmus and the Dominican Republic. 

I would also like to thank the governors, executive directors, and other members of the delegations who traveled to Guatemala to join us. 

We are here to talk about the challenges faced by people in Guatemala and throughout the Central American Isthmus and the Dominican Republic, and about how we can ensure that the IDB Group is in the best position to help them overcome these challenges, including with new initiatives like the regional program, America at the Center. 

But first, I want to congratulate President Arévalo and the Guatemalan people on the recent election and Guatemala’s democratic transition. This is an important achievement that we should not minimize. 

In a polarized environment, our commitment at the IDB is to promote dialogue, build bridges, and work closely with the government to strengthen democratic institutions, the rule of law and transparency. 

All this to promote sustainable development that creates jobs, lifts more people out of poverty, and benefits all Guatemalans. 

Mr. President, I wish you and your cabinet success. 

I would now like to share with some brief remarks about the outlook for Latin America and the Caribbean, in general, and for the Central American Isthmus and the Dominican Republic, in particular. Then, I will share my vision for Guatemala and the IDB’s work in this country. 

Over the last year, Latin America and the Caribbean have grown more than expected. Inflation is decreasing, thanks to responsible monetary and fiscal policies. At the same time, according to the latest available data, poverty decreased by 10% and is likely to have fallen even more last year. 

In the Central American Isthmus and the Dominican Republic, economic growth has also been better than expected, and superior to the rest of Latin America and the Caribbean. 

So, the question is: Is this better-than-expected performance a permanent phenomenon or just temporary? 

We believe these are preliminary signs that the region is at a potential inflection point. 

And that's because today, unlike in the past, Latin America and the Caribbean in general, and the Central American Isthmus and the Dominican Republic, in particular, have great potential to help solve some of the world's biggest challenges. 

From the Amazon rainforest to Central America and its biodiversity and natural treasures, our region helps absorb CO₂ emissions, mitigating climate change for everyone. In Central America, 70% of the energy comes from renewable sources, almost five times the global average. Finally, Latin America and the Caribbean produce enough to feed 1.3 billion people. 

With the right reforms and investments, Latin America and the Caribbean in general, and this region in particular, could be at the center of global efforts to protect the planet's biodiversity, provide clean energy, and alleviate food insecurity both in the region and globally. 

The IDB has worked to help the region seize these and other opportunities, and Guatemala is a good example of this. 

Guatemala has all the potential to lay the foundations for a prosperous, inclusive, and sustainable future. 

It has the youngest population in Latin America and the Caribbean. This demographic bonus is a remarkable asset that can lead to faster economic growth, more innovation, greater social vitality, and stronger human capital. 

Guatemala also stands out for its growth, the balance of its fiscal accounts, and the credibility of its monetary policy. 

Indeed, the country enjoys one of the region’s best credit ratings, and is just one step away from investment grade, according to ratings agencies. 

Guatemala also possesses one of the most remarkable cultural heritages in the world, with treasures like Tikal, a World Heritage site, and numerous indigenous communities that are among the most vibrant and vital in the world, where two dozen indigenous languages are spoken. 

From the magnificent national bird, the quetzal, to its imposing lakes and volcanoes, Guatemala also stands out for its natural beauty. 

All of this creates a unique opportunity for the country to accelerate sustainable development, making the right investments to realize its full growth potential. 

And at the IDB, we are committed to working closely with the government to seize this opportunity. 

The conversations we will have with our governors in our meetings here will help us amplify the impact of the work we are already doing in countries like Guatemala. 

I would like to mention three projects that show the value of the work we do in the region. 

The first is the Tecpán-Patzún highway, which is already bringing tangible social and economic benefits to tens of thousands of Guatemalans. People like Rosa Rodríguez, who lives in a farming community not far from here, in Patzún.  

Rosa says that thanks to a new local road, farmers in her area find it easier to produce and sell their produce. Her neighbors have also seen trade increase, local food prices fall, and exports rise, most of which go to the United States and Europe. 

Another example of a transformative project involves increasing electrification coverage in Guatemala, particularly in rural areas, which is a priority for President Arévalo’s government. This $120 million program, which was already approved by the IDB and is pending legislative approval here, will benefit 60,000 new households.   

Finally, another project, from IDB Lab, our innovation laboratory, focuses on agricultural innovation and has already helped nearly 10,000 farmers invest in climate-smart technology. This has helped increase crop productivity by up to 50% in some areas and prevented the emission of 1.2 tons of CO₂.  

These are just three examples of the kind of development results we want to bring to Guatemala and the region. 

Another highlight of the IDB's work is our emphasis on regional integration. A new regional program we are presenting today, America at the Center, focuses on the Central American Isthmus and the Dominican Republic and is structured around three fundamental pillars:  

• Productivity and Economic Integration 
• Climate Adaptation and Resilience 
• Youth Social Development 

Through new programs and financial instruments and close collaboration with the private sector, as well as with regional and international partners, this initiative aims to maximize the region's potential, promote sustainable development and build resilience. 

We are proposing programs to improve digital skills, facilitate trade, optimize disaster risk management and promote climate action. 

This meeting also opens a space to reflect together with our Governors on how we can build an IDB Group that is not only bigger, but better and more effective – better able to support countries like Guatemala. 

Specifically, we will discuss three important reforms: the IDB Group's new Institutional Strategy, a new business model and recapitalization for IDB Invest, our private sector arm; and the replenishment of resources of IDB Lab. 

With the support of our Governors, we will be able to do more, not only for Guatemala, but for the entire Central American Isthmus and the Dominican Republic. 

A year ago, when we met in Belize, I said that the challenges facing Central American countries were not created overnight, and so it would be unwise to think that we will solve them in one day. 

But as Guatemala and the region have shown, with patience and perseverance we can make impressive progress. 

Thank you again, President Arévalo, for kindly hosting us.