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IDB’s Moreno calls for Closer Ties with China and launches new programs with Chinese financial institutions

IDB President meets with top Chinese officials on two-day visit that highlighted areas in which the two regions could share their expertise

BEIJING, China – China and Latin America and the Caribbean should join forces to tackle development challenges such as education, urbanization and climate change, Luis Alberto Moreno, President of the Inter-American Development Bank (IDB), told Chinese officials during a visit.

Moreno held high-level meetings with Foreign Minister Yang Jiechi, Zhou Xiaochuan, Governor of the People’s Bank of China, the country’s central bank, and Mr. Zhu Xinqiang, Vice President of the Export-Import Bank of China on Sept. 16, the final day of the visit. The meetings were part of an effort to deepen ties to the Asian country, which became a member of the IDB in January 2009.

In remarks to top executives of the central bank during a seminar on “Doing Business with the IDB,” Moreno said he believed that both China and Latin America and the Caribbean would weather the current international economic slowdown well, thanks to far-reaching economic reforms they carried out over the past two decades.

“Although the global economy faces many challenges now, the fundamental trends in both China and Latin America place us on the threshold of an historic opportunity,” Moreno said.

If Latin America and the Caribbean continue to grow on average 4.8% a year, per capita incomes could double by 2030, Moreno said. China’s middle class also is expected to double, to over 40% of the population by the end of this decade.

That means leaders need to focus on providing better education, higher-skilled and better-paid jobs, improved housing, healthcare and infrastructure. “It’s not enough to simply focus on growing our economies,” Moreno said. “We have to increase the overall well-being of our people.”

Moreno’s remarks were based in part on the conclusions of his recently published book, The Decade of Latin America and the Caribbean. In the book, he said that while progress in the region is laudable, more work must be done to improve productivity and reduce income inequality.

He also urged leaders from China and Latin America and the Caribbean to share ideas on challenges faced by many developing nations, including urbanization, education, infrastructure, sustainable energy and the side effects of climate change.

Also speaking at the central bank seminar were Hans Schulz, manager of the IDB’s Structured and Corporate Financing Department; Jacques Rogozinski, General Manager of the IDB Group’s Inter-American Investment Corporation (IIC); and Bernardo Guillamon, manager of the Office of Outreach and Partnerships.

On Sept. 13, the IIC signed an agreement with the Bank of China that will allow companies from Latin America and the Caribbean to obtain credit in renminbis—the first time that a multilateral financial institution has created such an instrument utilizing the Chinese currency. The IDB also signed an agreement with the Export-Import Bank of China to provide up to $200 million in short-term trade financing that will allow transactions to be carried out in renminbis.

Additionally, the IDB launched a technical assistance exchange program between China and Latin America and the Caribbean. The program, Guillamon explained, will feature professional exchanges and the sharing of best practices in areas such as microfinance, expanding later to include other topics, such as sustainable cities, renewable energy and special economic zones.

The “Doing Business With the IDB” seminar also highlighted the opportunities for Chinese companies and firms to participate in bank-financed projects. Last year, the IDB organized the China-LAC Business Summit in Chengdu, China that brought together hundreds of business people and government officials from both regions. President Moreno also will attend the China-Latin America Business Summit that will take place in Lima, Peru on Nov. 21–22.

During his visit to China, IDB President Moreno also attended a gathering of business leaders at the World Economic Forum in Dalian, China, where he spoke on panels dealing with urban development and sustainable energy.

About the IDB

The Inter-American Development Bank supports efforts by Latin America and the Caribbean countries to reduce poverty and inequality. It aims to bring about development in a sustainable, climate-friendly way. Established in 1959, it is the largest source of development financing for the region.