Lowering fiscal and external vulnerability the key to promoting growth in Central America and the Dominican Republic
Regional IDB Governors meet in Washington to analyze economic prospects for 2017
The modest recovery in the United States and continuing favorable financial conditions in 2017 will also represent sources of economic stimulus throughout the year for the countries of Central America and the Dominican Republic, which will translate into growth of around 3.9 percent in 2017. Internal financial and monetary reforms should ensure price stability and the health of the banking system.
That was the message delivered by Luis Alberto Moreno, President of the Inter-American Development Bank (IDB), in his opening speech at the Thirty-first Meeting of the Governors of the Central American Isthmus and the Dominican Republic, held at the IDB’s headquarters Feb. 8-9.
He noted that the region’s commitment to integration has created opportunities to increase the diversification and sophistication of the export sector, while infrastructure initiatives in transportation and energy, such as SIEPAC (the Central American Electrical Interconnection System) and the Pacific Corridor component of the Pan-American Highway have demonstrated how the combined regional market supports the development of individual countries. In order to take advantage of these initiatives and the favorable external conditions, the region should redouble its efforts to consolidate fiscal accounts and strengthen the integration process even further.
“Advances in macroeconomic stability, the reduction of poverty, and integration, together with a young and growing population, allow us to be optimistic about the potential of these countries to transform their future,” Moreno told the top economic officials of Belize, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua and Panama.
The meeting provides an opportunity to discuss international economic trends in areas such as global trade, interest rates and the oil market, while exchanging ideas on strategic priorities for the region with senior IDB officials.
The IDB distributed a macroeconomic study that outlines the opportunities for fostering inclusive growth in Central America and the Dominican Republic, as well as a report on the Bank´s operations in the region in 2016.
In 2016, the IDB approved more than $1.6 billion in loans to strengthen public administration, productivity and integration, and to improve transportation infrastructure and human capital in the eight countries. Loan disbursements for the year totaled just under $1.5 billion.
The Inter-American Investment Corporation provided an additional $468 million in financing for the private sector in the eight countries, focused largely on expanding access to credit by small and medium size enterprises (SMEs), and on energy, especially the promotion of low-carbon technologies.
Those loans were complemented by 98 technical assistance operations totaling $45.5 million. One-third of the grants was directed toward regional initiatives in the areas of energy integration, trade and logistics infrastructure. An additional $15.4 million from the Bank’s Multilateral Investment Fund (MIF) was channeled toward support of microenterprises and small businesses, small-scale agricultural producers and low-income families in order to improve livelihoods.
About the IDB
The Inter-American Development Bank is devoted to improving lives. Established in 1959, the IDB is a leading source oflong-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.
[Source: IDB-Media Relations]
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