WASHINGTON, July 4, CMC – The World Bank says it will continue to support Caribbean and Latin America’s resilience to the ongoing global economic turmoil.
The Washington-based financial institution said that it has committed US$11.8 billion in fiscal year 2012 to support the initiative that includes resources from its International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA).
It said the IBRD and IDA maintained its “strong support for the region,” approving US$6.6 billion in new loans in fiscal 2012, nearly US$6.2 billion from IBRD -the window for middle income countries- and US$448 million from IDA , the fund for poor countries.
The World Bank said the support was aimed at “generating opportunities for all, through programs that increase productivity, create new good-quality jobs, and assist those most in need, while promoting environmental responsibility”.
It said Latin America and the Caribbean received the largest share of IBRD’ total new lending at 31 per cent, and more than 19 per cent of total IBRD/IDA lending.
The IFC, which supports sustainable private sector development through financing and advisory services, committed US$4.9 billion to 134 private sector projects in Latin American and the Caribbean, including US$1.3 billion mobilized from other financial sources, the World Bank said.
It said IFC’s investments spanned 25 countries in the region with a focus on inclusive growth (49 projects, totalling US$1.6 billion in microfinance, health, education, housing, and regional and global integration amounting to 68 projects totalling US$2.4 billion for South-South investments, regional expansion of companies, trade finance, infrastructure).
The bank said the IFC also focused on innovation, which is essential to increase productivity and competitiveness in the region, with 18 investment projects for US$919 million.
During fiscal year 2012, the World Bank said MIGA provided support for three projects in Latin American and the Caribbean with US$353.6 million in political risk insurance coverage.
The bank said resilience to recent global turmoil allowed Latin America and the Caribbean to grow 4.3 per cent in 2011. It said the region is expected to continue to grow but at a lower level (3.5 per cent) mainly due to the Euro- Zone debt crisis, the slower than expected recovery in the US and the planned slowdown in China, a key trade partner and the engine behind the solid growth and market diversification of the past few years.?
“Unprecedented growth and economic stability over the past decade pulled some 73 million people in the region out of poverty,” the World Bank said.
“Many countries in Latin America and the Caribbean are highly exposed to the global economy but still maintain low vulnerability thanks to healthy levels of foreign reserves and exchange rate flexibility, as well as their capacity to respond to external shocks from fiscal, monetary and macro-prudential fronts,” it added.