Stevan Jackson (202) 458 5054, firstname.lastname@example.org
Adriana Gomez/IFC (202) 458 5204, email@example.com
Mallory Saleson/MIGA – (202) 458 0844, firstname.lastname@example.org
WASHINGTON, July 1, 2009 — The World Bank Group (WBG) committed $17.1 billion in fiscal year 2009 to help countries in Latin America and the Caribbean (LAC) struggling amid the global economic crisis, a 70 percent increase over the previous fiscal year and a record high for the global development institution in the region.
“Requests for assistance from the World Bank Group rose sharply this year, and we expect this to continue well into 2010, as the pace of recovery is far from certain,” said World Bank Group President Robert B. Zoellick. “Millions of people are still suffering, and we must continue to help countries safeguard priority expenditures, including on essential infrastructure, investment in human capital, and social safety nets, or we will further jeopardize hard-fought gains over recent years in overcoming poverty.”
The World Bank Group devoted significant energy and resources in FY09 responding to the needs of countries hit by the global financial crisis, with a strong focus on initiatives to protect the most vulnerable in the poorest countries; maintain long-term infrastructure investment programs; and sustain the potential for private sector-led economic growth and employment creation.
In LAC, commitments from the International Bank for Reconstruction and Development (IBRD), which provides financing, risk management products, and other financial services to countries, and the International Development Association (IDA), which provides interest-free loans and grants to the world’s poorest countries, more than tripled in FY09 to $14 billion for 64 operations, up from $4.7 billion the previous year. Support to LAC during FY09 represents almost a third of total Bank IBRD/IDA lending (30%), and 42 percent of total IBRD lending.
Fast-disbursing Development Policy Loans, providing critical budget support at a time of rising financing gaps, comprised 51 percent of IBRD/IDA lending. A key factor that enabled the Bank to respond quickly was the ability to draw on knowledge previously built up in a wide range of sectors. Support from IBRD/IDA focused on key areas such as social protection, environment and economic policy. Brazil, Mexico, Argentina, Peru and Colombia were the leading borrowers.
The WBG’s International Finance Corporation (IFC), which supports sustainable private sector development through financing and advisory services, doubled in FY09 the number of investments in the region, supporting 122 projects in 21 countries, including 6 IDA, with a contribution of $3.3 billion, of which $775 million were in syndicated loans. IFC also supported 68 advisory services projects to help improve business environment, promote access to finance for underserved segments and enhance the benefits of private sector projects in local communities. As part of its crisis response initiatives, IFC doubled its trade finance guarantees to the region to $825 million, and focused on increased support to the financial sector and infrastructure, sending a positive signal to the markets to help increase confidence and to bring back private capital flows to the region.
In response to the financial crisis, the WBG’s Multilateral Investment Guarantee Agency (MIGA) entered a joint donor initiative to spur economic growth in Latin American and Caribbean countries and to protect the economic and social gains achieved during the last five years. In fiscal 2009 MIGA provided $33.9 million in guarantees in the region. Projects supported by MIGA have had significant development impact, particularly in helping to address the region's pressing infrastructure needs.