- EIB, IDB sign Mutual Reliance Agreement to accelerate co-financing of joint projects, enhance collaboration in the region
- EU Bank delegation meets IDB President on the margins of the World Bank Group, IMF meetings in Washington
- EIB Chair of the Multilateral Development Banks, President Werner Hoyer, encourages stronger global collaboration
The European Investment Bank (EIB) and the Inter-American Development Bank (IDB) signed a new agreement enabling them to better support climate resilient projects throughout Latin America and the Caribbean. The Mutual Reliance Agreement will improve project implementation and monitoring, empowering the EIB and the IDB to finance climate-focused investment more efficiently.
The initiative enhances efforts by both banks to harmonize their work on projects and make development resources more effective. Specifically, the new agreement allows the EIB and the IDB to delegate to each other procurement tasks related to project preparation, implementation, and monitoring. That will improve joint financing arrangements, increase efficiency, and reduce transactional costs for partners in the region. In practical terms, for each new project that is co-financed, partners will now be able to designate a lead co-financier whose procurement policies will govern the project, with the other co-financier relying on the lead’s work. The agreement also bolsters the banks’ commitment to streamlining procurement activities for promoters and recipients and enables multilateral development banks (MDBs) to monitor procurement activities more efficiently.
The agreement was signed during a bilateral meeting between EIB President, Werner Hoyer and IDB President Mauricio Claver-Carone on the margins of the Spring Meetings of the World Bank Group and the International Monetary Fund in Washington. It will increase the coherence of co-financed operations and improve the ability of both institutions to identify development priorities and determine in which countries these operations can have the greatest development impact.
Speaking at the signing event in Washington, EIB President Werner Hoyer said: “Latin America and the Caribbean has all the right conditions to become a global renewable energy hub. Today, we are marking an important step to unlock investment opportunities in partnership with IDB, focusing on increasing the impact of our joint support for growth, innovation, climate action and resilience.”
IDB President Mauricio Claver-Carone said, “At the Inter-American Development Bank, over the past two years we have strived to expand our support to the region and improve the way we respond to the needs of our member countries. As a result, we’ve reached unprecedented financing levels. It is critical that we continue to improve how we work with partners to maximize synergies, facilitate co-financing, and streamline processes to ensure our work is as efficient, effective and approachable as possible. This new agreement with the European Investment Bank achieves this very goal, optimizing the process for joint financing and enabling our organizations to double down on our work together.”
The EIB-IDB partnership supports projects that promote climate action and attract private investment in Latin America and the Caribbean. The banks co-finance projects across the region, including new metro systems in Colombia and Ecuador, the expansion of the Panama Canal, and the recent Rio Salado flood protection project in Argentina. The banks are also building on their ongoing work to co-finance projects by funding additional sovereign guaranteed operations, including Colombia and Peru, and by identifying key areas where they can expand the co-financing of non-sovereign guaranteed operations with IDB Invest, which is the IDB’s private sector investment arm.
About IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source of long-term financing for economic, social, and institutional development in Latin America and the Caribbean. The IDB also conducts cutting-edge research and provides policy advice, technical assistance, and training to public and private sector clients throughout the region.
EIB Global is the EIB Group’s new specialised arm dedicated to increasing the impact of international partnerships and development finance. EIB Global is designed to foster strong, focused partnership within Team Europe, alongside fellow development finance institutions, and civil society. EIB Global brings the Group closer to local people, companies and institutions through our offices across the world.