Inter-American Development Bank President Luis Alberto Moreno today announced the IDB’s new initiatives and projects for Central America and the Dominican Republic in 2008, which include some US$2 billion in investments.
Moreno’s announcement came during the Twenty-Second Meeting of the IDB Governors for the Central American countries and the Dominican Republic, held this Thursday and Friday in La Romana in the Dominican Republic.
Initiatives noted by Moreno include formulating action plans and programs for biofuels, energy efficiency and renewable energy; support for infrastructure projects by both the public and private sectors; sector strategy plans for water and sanitation; and specific projects under the IDB’s Opportunities for the Majority Initiative.
The IDB is expected to approve US$2 billion in loans for 2008 for the countries in the subregion, including US$700 million for private sector projects.
In addition, projects in Central America and the Dominican Republic are expected to account for 20 percent of total IDB approvals for non-sovereign-guaranteed operations in 2008, up from 13 per cent in 2007.
The meeting in La Romana is a major opportunity for dialogue with the countries in the subregion in order to set the IDB’s objectives and working agenda, Moreno explained
Besides Moreno, IDB representatives at the meeting included Executive Vice President Dan Zelikow, Vice President for Countries Otaviano Canuto, Vice President for Sectors and Knowledge Santiago Levy, Vice President for the Private Sector Steven Puig and subregional manager Gina Montiel.
“All of the Bank’s top managers are here with us,” Moreno said. “We’ve brought the IDB here for this dialogue with you, because it is key to setting our course for 2008–2009.”
The agenda for the meeting will focus on analyzing the situation in the region in order to better address international financial turmoil. It will also include a discussion of results-based budgeting, which is an important instrument for improving the quality of spending.
With growth averaging around 6 percent, the subregion has performed well during the past three years, surpassing Latin America as a whole, Moreno pointed out. But he warned that the economic slowdown in the United States and the sharp fall in the financial markets call for caution, especially when a large percentage of the region’s average growth is attributable to such external factors as rising commodities prices and falling interest rates.
“Such a pronounced dependence on external conditions calls for major improvements in the productivity of our economies and to strengthen macroeconomic fundamentals even more,” Moreno said.
A good rate of economic growth alone is not enough to guarantee sustained growth: it also depends on the quality of macroeconomic policies and the quality and efficiency of spending.
“Achieving quality growth, as well as developing the social inclusion that growth promotes and opening opportunities to participate in the economy require a collective effort and a clearer focus on our main challenges of addressing poverty and inequality,” Moreno said.
Moreno stressed the importance of international coordination of risk management and international integration policies, especially as the region’s economies continue to integrate even more. He also took the opportunity to commend the countries in the subregion for actively promoting regional integration into various trade blocs that can best take advantage of the opportunities created by agreements such as CAFTA.
“We must strengthen this kind of coordination and extend it to the macroeconomic areas of growth,” Moreno said. “A joint effort to lower transportation costs and improve communications, as well as changing the subregion’s energy matrix by diversifying and developing clean, inexpensive sources of energy, and facilitating trade are important issues in the agenda for coordinating regional policies.”