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14.7 billion for social programs, public sector efficiency, private sector development, climate change and infrastructure
WASHINGTON, July 1, 2011
- The World Bank Group (WBG) committed $14.7 billion in fiscal year 2011 (July 2010 to June 2011) to support a sustainable economic recovery in Latin America and the Caribbean. This includes resources from the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA).
The World Bank (IBRD and IDA) maintained its strong support for the region approving $9.6 billion in new loans in fiscal 2011, $9.2 billion from IBRD and about $400 million from IDA. Support was aimed at generating opportunities for all through programs that increase productivity, create new good-quality jobs, and assist those most in need, particularly through conditional cash transfers, which were pioneered in the region.
Mexico ($2.7 billion) and Brazil ($2.5 billion) were the largest borrowers in the region. Health and social services, public administration and law, and transportation received the most funding. Support to the region represented a third of IBRD lending and 22 percent of total IBRD/IDA lending.
The WBG's International Finance Corporation (IFC), which supports sustainable private sector development through financing and advisory services, committed $5.1 billion to private sector projects in Latin America and the Caribbean, making fiscal year 2011 a record year for IFC in the region. Mobilization totaled $2.1 billion, strengthening IFC’s catalytic role and development impact. Investments in the Caribbean region reached an all-time record of $452 million, including $106 million in mobilization.
IFC’s investments, including mobilization, spanned 24 countries in the region with a focus on inclusive growth (30 projects, totaling $823 million in microfinance, remittances, health, education, housing), and climate change (21 projects for $1 billion in energy efficiency and renewable energy).
IFC also supported 81 advisory services projects for a value of $75 million to help improve business environment, promote access to finance for underserved segments and enhance the benefits of private sector projects in local communities.
During fiscal year 2011, the Multilateral Investment Guarantee Agency (MIGA) provided support for three projects in Latin America and the Caribbean with $21.7 million in political risk insurance coverage through guarantees issued to ProCredit Holding of Germany, a provider of credit and other banking services to very small, small and medium-size enterprises in transition economies and developing countries. MIGA remains committed to helping the economies of the Latin American and Caribbean region continue on a path of growth by supporting investments that create jobs and provide lending services to the real economy
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LAC continues to grow with strong anti-poverty results.
Latin America and the Caribbean experienced one of the strongest periods of growth in a century between 2002 and 2010, due to strong macro-economic policies and the increase of commodity prices. Growth quickly rebounded from the global recession, reaching 6 percent in 2010. As a result, more than 50 million people were lifted out of moderate poverty between 2002 and 2010, and for the first time inroads were made against persistent inequality. Solid growth of 4–5 percent is projected for 2011.
The economic health of the region is a tribute to the reforms undertaken over the past two decades to achieve macroeconomic and financial stability. Until 2002 Latin America was a large global debtor. Today it is a significant creditor to the rest of the world, and foreign capital flows into the region take the form of equity rather than debt. By December 2010 annual gross capital inflows for the largest countries in the region reached almost $330 billion, an increase of almost $80 billion over the previous record, achieved in March 2008.
