The Inter-American Development Bank today announced that it has established two trust funds with grant resources from the Department for International Development of the United Kingdom to address issues of poverty reduction related to governance, and markets and trade integration.
The Markets and Governance for Poverty Reduction Trust Fund and the Trade and Poverty Trust Fund will provide £4.455 million (US$8 million) in grant resources during 2005-2008. The DFID has also funded a similar trust fund at the World Bank.
Endowed with £3.605 million, the Markets and Governance trust fund will finance activities related to Pro-poor Access to Markets and International Trade, and Responsive and Accountable Public Sector Management and Political Systems. Grant financing is available for technical assistance projects related to labor markets, international trade, informality and investment climate, political economy of reform, transparent and accountable budgetary processes, and data and studies to evaluate poverty and social exclusion.
DFID also supported the establishment of the Trade and Poverty Trust Fund with a catalyst grant of £850,000 (US$1.5 million). The Bank will seek contributions from additional donors to finance grants that support the adoption of trade related strategies and policies that will benefit the poor in the countries of the region. The resulting project portfolio is intended to strengthen the fight against poverty through IDB policy-oriented studies. It is also designed to integrate poverty reduction objectives in IDB trade-related programs and operations and promote an inclusive dialogue on trade and poverty among policymakers and stakeholders.
Since 1999 the DFID has provided more than US$23 million in grant financing for technical cooperation activities and for local counterpart financing of IDB loans in areas such as development effectiveness, poverty reduction strategies, social management, local capacity building, social inclusion and fiscal reform, among other activities.