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Expectations for JBIC in Latin America

By - Aug 19 2014

LAC JAPANThe ‘Decade of LAC’ and private sector development

‘The 2010s should be considered the decade of Latin America and the Caribbean (LAC)’, said Luis Alberto Moreno, President of the Inter-American Development Bank (IDB) in 2012, having seen recent high economic growth in the region. ‘LAC is a growth center comparable to Asia.’ He pointed out the increase in productivity through structural reform, improvement of infrastructure, and overcoming income disparity and inequality as key factors for future development. It is now an urgent task to address these problems by mobilizing the private sector.

In this regard, the IDB is considering streamlining its private sector financing arm, which is currently divided in four institutions within the IDB Group. A final decision is scheduled for the Group’s 2015 annual meeting in Busan, Korea. Traditionally, multinational development banks have primarily focused on sovereign financing, but they are now expected to shift their focus toward private sector.

Legend of Japanese companies and immigrants and JBIC’s role

In looking at the development of LAC, the contribution of Japanese companies has been remarkable, as they have actively transferred their technology to help develop the region’s manufacturing industries. Also, the contribution of Japanese immigrants should not be forgotten, building trust in LAC nations through many decades of hard work and honesty.

I think the Japan Bank for International Cooperation (JBIC) can play a big role in the region moving forward. It is important to get involved in a project in its initial stage. A project may start from stimulating local demand and finding an optimal solution. JBIC is expected to provide the expertise required for developing projects, in addition to fiancing.

Since its inception as a member of the IDB Group in 1976, Japan has been the IDB’s biggest non-regional partner. The IDB and JBIC have co-financed more than US $5 billion for nearly 30 projects, including the expansion of Panama Canal in 2008, ‘RODOANEL’ São Paulo Beltway project of Brazil in 2009, and joint participation in Mexico’s Balam Fund for investing in renewable energy and energy efficiency projects in 2013.

The IDB has high expectations for JBIC. We have built up mutual trust through regular policy dialogues, including at the senior management level. I believe we can overcome whatever challenges we may face and jointly achieve results in the development of LAC.

This feature on the Japan-LAC, JBIC-IDB relationship was written for JBIC Today, a publication of the Japan Bank for International Cooperation. 

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