BRIDGETOWN, Barbados, Thursday March 21, 2013 – The China Co-financing Fund for Latin America and the Caribbean is the first of its kind established by China and a multilateral development bank.
The fund is the result of a partnership between the Inter-American Development Bank (IDB) and the People’s Bank of China (PBC) to support public and private sector projects that promote sustainable economic growth in the region.
The IDB said the fund will provide capital to complement the IDB’s own resources for projects seeking to alleviate poverty and reduce inequality, boost private sector investment, improve competitiveness and social welfare, and support programs to mitigate the impacts of climate change and promote greater gender equality.
The proposed US$2 billion contribution by China will be used to co-finance a total of up to US$500 million of IDB public sector loans and up to US$1.5 billion for loans made by the Bank to private sector entities, the IDB said.
It said co-financing fund resources will be used to complement IDB loans, subject to pre-established limits.
The IDB said the funds from China will be available for the next three years for public sector projects and the next six years for non-sovereign guaranteed operations.
“China is a key partner for the Bank’s mission to alleviate poverty and inequality in the region,” said IDB President Luis Alberto Moreno.
“This partnership is another example of our efforts to promote greater South-South cooperation to narrow funding gaps in sectors with high developmental impact and enhance the social and economic impact of our projects,” he added.
In partnering with the IDB, China hopes to channel its resources toward development finance projects that require additional financing to make them viable, the statement said. Click here to receive free news bulletins via email from Caribbean360. (View sample)