# Presentation: 917533

## A Conference on Providing Solutions and Creating Opportunities for U.S. Companies at the Multilateral Development Banks

**A Conference on Providing Solutions and ****Creating Opportunities for U.S. Companies at the ****Multilateral Development Banks**

## The Inter-American Development Bank

## Brief History

- Established in 1959, world’s largest and oldest regional multilateral development bank
- Prime source of development financing for Latin America and the Caribbean
- 47 Member Countries
- 26 Borrowing
- 21 Non-borrowing

**Notes:**
The Bank is owned by its members (26 borrowing members in Latin America and the Caribbean and 21 non-borrowing members, which include the United States, Canada and Japan. This year Korea joined the Bank.The United States is the Bank’s largest shareholder. 
The Bank has offices in all of its borrowing member countries. The country offices help to identify new projects, supervise and manage loans that have been approved, and monitor project execution. 

## Basic Facts

- The IDB provides
-  loans, grants, guarantees, policy advice and technical assistance
- IDB Group
- Inter-American Development Bank
- Inter-American Investment Corporation
- Multilateral Investment Fund

**Notes:**
The IDB provides loans, grants, guarantees, policy advice and technical assistance through the three entities that comprise the IDB group: (1) The Inter-American Development Bank, (2) the Inter-American Investment Corporation, and (3) the Multilateral Investment Fund. All of which are headquartered in DC.
The Inter-American Investment Corporation (IIC, 1989) is an autonomous institution that supports small and medium-sized private enterprises in Latin America and the Caribbean that have limited access to long-term market financing.
The Multilateral Investment Fund (MIF, 1992) is the principal source of grants for private sector development in Latin America and the Caribbean.

## Lending Volumes

- In 2004, IDB approved $6 billion of loans and guarantees
- Disbursed $4.2 billion in 2004
- Since creation, approved over $136 billion in IDB loans
- Total cost of projects: $305 billion

**Notes:**
Total cost of projects is greater (>) than projects approved due to funding provided by other source (i.e., executing agencies and/or financial institutions such as the World Bank)

## Disbursements for Purchase of Goods: 1961-2004

**Notes:**
One-third of the money paid out by the IBD for goods have been paid to U.S. companies.

## Disbursements 1961-2004 (in millions)

**Notes:**
Total is $66 billion

## Disbursements for Purchase of Goods in 2004

## Total Disbursements 1961-2004

*$66 billion*

## Priority Areas For Businesses

- Social Programs

- Infrastructure

**Notes:**
IDB financed $270 million for a Social Support Network Program in Colombia. This program mitigates the effects of the economic recession on very poor families with children under seven years of age through three subprograms: (a) employment; (b) worker training; and (c) family support. Participants will be selected partially through the beneficiary identification and selection system (SISBEN) used in Colombia to select beneficiaries for social programs. In the case of beneficiaries not yet registered in SISBEN, the municipality will undertake additional surveys. Subprogram 1 generates employment for unskilled labor by: (a) providing cofinancing for small basic infrastructure projects and community projects in low-income urban areas; and (b) supporting neighborhood improvement programs, social and community infrastructure, and expansion of residential public utility service. Subprogram 2 improves job opportunities for semiskilled, low-income youth, ages 18 - 25, in seven of the country's major cities where unemployment is highest (Bogotá, MedellÝn, Cali, Barranquilla, Bucaramanga, Manizales, and Cartagena). The training consists of a classroom phase, including vocational training, followed by related, full-time work experience in industry. The subprogram also strengthens the capacity of potential training entities by funding: (a) design of a strategy and support materials to prepare training institutes to take a skill- and workplace-focused approach to training; (b) development of introductory workshops for institutes with the potential for offering such training; and (c) virtual support activities for institutes offering training, through provision of online materials and consultation. Subprogram 3 encourages families living in extreme poverty to increase and maintain investment in their children's human capital through a conditional grant providing beneficiary mothers with direct financial support in exchange for the fulfillment of commitments by the family. Funding covers a school grant and a food and health grant. Implementation will take place in stages, the first of which, on a reduced scale, will make it possible to evaluate the effectiveness of program design, consolidate the institutional factors, and produce a demonstration effect for gradually extending the program. 
$200 million was financed to rehabilitate highways and bridges in Venezuela. Approximately 27,400 km of existing highways will rehabilitated. Important actions to be taken include: road road rehabilitation; maintenance of bridges and tunnels; and the improvement of existing highways. Other Actions include: providing and installing road test sites; and acquiring equipment to facilitate institutional strengthening. 

## Priority Areas

- 3. Institutional Reforms
- New Procurement Policy adopted 2005
- Focus on Anticorruption Activities
- Establishment of Office of Institutional Integrity
- Use of Sarbanes-Oxley
- Improved Disclosure Policy 2003-2005

**Notes:**
Under the new policies, the use of standard documents is mandatory, Bank capacity and procurement oversight will increase, the procurement information system will be redesigned, procurement procedures and manuals will be revised, and we will mainstream the analysis and strengthen the country and executing agency capacity.
Increasing transparency in procurement is an on-going effort and is part of the IDB’s overall efforts to improve corporate governance.  In 2004, the Bank took significant steps internally to improve corporate governance.
In the first quarter of 2004, the Office of Institutional Integrity (OII) began operations.  OII is responsible for receiving and investigating all allegations of corrupt or fraudulent activities and unethical behavior involving Bank activities or staff.  The first annual report from OII has been posted on the IDB web site. 
The IDB publicly demonstrated its commitment against corruption in December 2004 by issuing a joint statement with the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, and the World Bank that reaffirmed our shared commitment to fight corruption.

## Priority Areas

- 4. Regional Integration
- Regional Infrastructure Initiative for South America (IIRSA)
- Puebla Panama Plan (PPP)
- Mexico & Central America

**Notes:**
The objective of the IIRSA is to improve the competitiveness of the regional economy and its integration into the global economy, and promote sustainable socioeconomic development in these countries, especially through the modernization and integration of their infrastructure and logistics in the transport, energy and telecommunications sectors. 
Regional integration is a policy instrument for achieving a set of development goals and objective.  It establishes priorities that allow the bank to maximize its comparative advantage. These priorities include: consolidating regional markets in the context of an overall opening to the world trading system; promoting regional infrastructure; strengthening institutions for integration; and developing other regional public goods. 
Puebla Panama Plan (PPP) to harmonize infrastructure & regulatory frameworks. Many real projects firms can bid on.
Launched earlier in 2001 by Mexico's President Vicente Fox as part of the National Development Plan ("Plan Nacional de Desarrollo"), Plan Puebla - Panama seeks to accelerate the integration and development in a region that covers nearly 375,000 square miles and has 64 million inhabitants. It includes all seven countries in Central America and the Mexican states of Campeche, Chiapas, Guerrero, Oaxaca, Pueblo, Quintana Roo, Tabasco, Veracruz and Yucatan.
Panama Plan includes specific projects, financed by IDB, that would boost integration and stronger ties among the Central American nations and among the states in southern and southeastern Mexico.

## Business Opportunities

- Loans generate business
- 13,000 contracts per year
- Civil works, equipment, consultants
- International competitive bidding
- Firms from member countries eligible

## Sector Trends 1961-2004

**Notes:**
IDB loans have supported the construction and expansion of thousands of schools and hospitals, installation of potable water and sewage facilities, environmental and tourism projects, construction of tens of thousands miles of roads and installation of other transportation and communications infrastructure. 
The bank has supported bi-national and regional energy, bridge construction, and other transportation projects that have helped integrate the economies of the region.
Its support for small business and micro-enterprises has benefited millions of poor people.
The Bank was created to address social issues in the region. Many of the energy projects are financed by the Private Sector areas.

## Sector Trends 2004

**Notes:**
In 2004, IDB financed $350 million to the Multiphase Program for Urban Poverty Reduction, a social investment for Mexico. The Main objective will be to support SEDESOL in the execution of its "Habitat"program, paying special attention to: (a) urban poverty improvement; (b) women heads of households; and (c) slum upgrading. The program will also include a component for the evaluation of all the social programs under SEDESOL's responsibility. 
A Multisector Credit Program was approved for 1.0 billion. A program to support the Brazilian government’s efforts to modernize and increase the competitiveness of the productive sectors.This would: (a) maximize the use of adequate distribution channels, which in turn will impact the effectiveness of the SMEs, along with the hiring of a proven institutional executor; (b) increase the scores of individuals that rely on the banking system; (c) maximize the impact on the integration of more companies into the formal economy and increase formal employment in about 80 percent of the country's businesses; (d) increase tax revenues by integrating most of the local enterprises to the formal economy; and (e) maintain the current levels of development efficiency and economic growth, along with disposing of public resources that are suitable for development 
$157 million was funded to “Turn Nurse workers into Professionals” in Brazil. This project seeks to improve the quality of outpatient and inpatient medical care by professionalizing auxiliary personnel, particularly those working in establishments (mostly private charitable institutions) under contract with the Unified Health System (SUS) to provide care to low-income families. The two components are: (a) schooling and professional qualification of nursing personnel; and (b) institutional strengthening of the SUS agencies regulating technical human resources training. The first component funds professionalization courses and schooling for unskilled nurse's aides, through subprojects submitted to a competitive fund. The second component is aimed at ensuring the viability and sustainability of the first component's activities by preventing future hiring of unskilled nurse's aides, expanding opportunities the training nursing auxiliaries, and introducing systems to raise and regulate the quality of their professional training. Funding will cover: (a) teacher training for instructors and evaluators needed for the professionalization courses and the skills certification system; (b) design and implementation of a skills certification system for auxiliary nurses; (c) design and implementation of information systems on the labor market and human resource training in the sector; and (d) administrative modernization and technical/managerial strengthening, including training, for the technical schools of the SUS (ETSUS). The component also provides that the Workers' Support Fund will finance training activities designated as priority by the Ministry of Health (SIS). 

## Project Pipeline 2005-06

## Operations

**Programming**

**Identification**

**Preparation**

**Analysis**

**Negotiation**
**and**
**Approval**

**Execution**
**and**
**Supervision**

| 

Borrower
& Bank

Pre-feasibility studies
 | 

Borrower
& Bank

Studies, diagnoses, assess alternatives

Project Outline | 

Borrower
& Bank

Studies, designs, review experience

1-2 Years | 

Bank

Review feasibility studies

Procurement Plan | 

Borrower
& Bank | 

Borrower
& Bank

Advice, training, studies, institutional strengthening, equipment, software

4-8 Years |
| --- | --- | --- | --- | --- | --- |

**Notes:**
The project cycle is 5-10 years.

## How to Access Opportunities

- Learn the Project Cycle/Get into the Pipeline Early!
- Learn the Procurement Rules
- Find Local Representation
- Focus on Relationships - Network!

## IDB Contacts

- _[www.iadb.com](http://www.iadb.com/)_
- _[www.export.gov/commercialservice](http://www.export.gov/commercialservice)_
**Brian McCleary, SCO-Designate**
**Patrice Williams, Acting SCO**
**Barbara White, Deputy Director**
- 				**U.S. Commercial Liaison Office**
**	****	****	****	****Tel: (202) 623-3842/21/22**
**	****	****	****	****Fax: (202) 623-2039**
**	****	****	****	****E-mail: ****	****	****	****	****	****	****	**_[Brian.McCleary@mail.doc.gov](mailto:Brian.McCleary@mail.doc.gov)_
**	****	****   ****	****	**_[Barbara.White@mail.doc.gov](mailto:Barbara.White@mail.doc.gov)_

## A Conference on Providing Solutions and Creating Opportunities for U.S. Companies at the Multilateral Development Banks

**A Conference on Providing Solutions and ****Creating Opportunities for U.S. Companies at the ****Multilateral Development Banks**