The Multilateral Investment Fund of the Inter-American Development Bank today announced the approval of a $1.1 million grant to support a project in Mexico that will provide technical assistance to new and small enterprises in the states of Guanajuato, Zacatecas, and Puebla, all regions of high migration.
Pilot financial mechanisms will be established or strengthened in each of the three states that will allow remittances - the money sent back to family members by migrants working abroad - to be channeled into productive entrepreneurial projects. The project’s goal is to help strengthen the competitiveness of the local communities, leading to increased revenue and employment. Active participants in the project include the local government, local private investors and clubs of Mexican migrants abroad. The Mexican development bank Nacional Financiera (NAFIN) will be the executing agency of the program.
This is the third project approved by MIF this year that focuses on helping channel remittances into productive investments. The two other remittance projects are in Ecuador and Brazil. Plans for at least four more related projects are expected to be approved in 2002.
Another goal in the series of MIF projects on remittances is to promote agreements between financial institutions in countries where remittances originate and corresponding institutions with similar objectives in remittance-receiving countries. Such partnerships allow migrants living abroad and their families back home to have access to a package of financial services that reduce the cost of transferring remittances and also encourage productive investments.
The Multilateral Investment Fund, an autonomous fund administered by the Inter-American Development Bank, provides grants and investments to accelerate private sector development and help improve the climate for investment in Latin America and the Caribbean.