IDB and World Bank Approve Full Mutual Reliance Framework

WASHINGTON — The Inter-American Development Bank (IDB) and the World Bank have approved the Full Mutual Reliance Framework (FMRF), an innovative cofinancing arrangement that will help streamline jointly financed development projects in Latin America and the Caribbean.

This framework delivers on a longstanding request from shareholders for multilateral development banks (MDBs) to work more effectively as a system and maximize development impact. Under the FMRF, the IDB and the World Bank may rely on one another's operational policies when cofinancing eligible projects, reducing duplication and simplifying project preparation and implementation.

The IDB and World Bank engaged with accountability mechanism experts and civil society organizations during the development of the framework, which preserves access to accountability mechanisms and establishes arrangements for coordination between the institutions in the handling of complaints.

The FMRF is expected to reduce administrative complexity and transaction costs for borrowing countries while enabling the two institutions to pool financing, expertise, and knowledge in support of larger and more effective development initiatives.

The framework will apply to sovereign-guaranteed operations across sectors in Latin America and the Caribbean. Projects will be selected on a case-by-case basis based on borrower needs, strategic relevance, and opportunities to maximize development impact.

Projects processed under the framework will be publicly disclosed on both institutions' websites, pursuant to their respective access to information policies.

The approval of the FMRF marks an important step toward deeper collaboration among multilateral development banks and a more efficient development financing system that delivers results for countries and communities across Latin America and the Caribbean.