A new coalition formed by the Inter-American Development Bank and private sector companies to increase growth and investment in Latin America and the Caribbean isn’t just “more rhetoric” but a “historic partnership,” IDB President Mauricio Claver-Carone said Wednesday.
“I felt, and I ran on this, that the private sector had stopped really looking at the IDB as a leader, or as a guide, in regards to the region,” said Claver-Carone, who took the helm of the regional development bank in October.
Forty global executives have joined the new Private-Sector Partners Roundtable on the Future of Latin America and the Caribbean, which launched Tuesday. Participants include Amazon, Google, Microsoft, IBM, Telefónica, Millicom, Visa, and Walmart.
“We’re incorporating them into our workstreams, we’re creating working groups in each of these sectors,” Claver-Carone said. “Not one-offs — ‘Hey, we took a picture, we’re here on Twitter’ — no, no. We are actually working within these workstreams to find those opportunities. … We want to be the best salespeople for the region. There’s a market for it.”
“We are out there doing all sorts of creative things to be able to have more money available to us to help the region during its worst socioeconomic crisis.”— Mauricio Claver-Carone, president, IDB
Claver-Carone’s “Vision 2025” strategy for IDB includes five pillars: digitalization, strengthening value chains and nearshoring, climate, small- and medium-sized enterprises, and gender. He said IDB will set forth an agenda focusing on those areas when it meets next month for its annual meeting, to be held in Barranquilla, Colombia, and virtually.
Public-private partnerships will be key to increasing digital access across the region, Claver-Carone said, noting that the COVID-19 pandemic has shown connectivity to be integral for working and learning. An estimated 250 million people in the region don’t have digital access, including 35 million children who have been unable to attend remote classes due to lacking a connection, he said.
“This partnership was an action call, so all these companies that signed on have actually now not only volunteered but are committed to increasing their investments in the region,” Claver-Carone. “It’s not just about what we can do with our capital; it’s about scaling it as well with private sector capital. And that’s a huge value-add that we’re bringing to the institution.”
Claver-Carone said the bank is also looking to expand its shareholder base as part of a capital increase to boost resources available to the region as it recovers from the pandemic. The current shareholders are the bank’s 26 regional borrowing members, as well as the United States and Canada. A host of European countries, as well as China, Japan, and South Korea, also hold small stakes.
Claver-Carone said IDB is talking to India about a role it could play at the bank, and he also expressed his support for involvement from Taiwan — which “shouldn’t affect our relationship with China in any way,” he said.
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“As open as I am to adding other countries and bringing them in, remember the shareholding of the bank was really a product of the ‘60s and it doesn’t reflect the realities today of the bank. And I think there’s another discussion here to be had — is whether that shareholding reflects what the region looks like today,” Claver-Carone said, noting that Spain — which currently holds a share of less than 2% in the bank — and Mexico — which holds a share of about 7% — could both play larger roles in IDB given the sizes of their economies today.
Claver-Carone said he is “confident” he’ll be able to secure IDB a capital increase, which has already seen bipartisan support on Capitol Hill and will need to be approved by the U.S. Treasury Department. But it would still take several years for that money to be ready to invest, he said.
“We are out there doing all sorts of creative things to be able to have more money available to us to help the region during its worst socioeconomic crisis. We need to focus on making more resources available to the bank,” Claver-Carone said. “I’m going to work tirelessly to get [a capital increase] because the region needs it.”