The Inter-American Development Bank (IDB) has secured US$317 million in capital replenishment for the Multilateral Investment Fund (MIF), the bank’s innovation lab, most of which has been donated by Latin America and Caribbean (LAC) countries.
LAC countries have agreed to contribute US$167 million, while Japan has pledged US$85 million. The remaining balance is coming from Spain, Canada, China, and five other European countries.
“This decision represents a vote of confidence in the IDB Group,” said IDB President Luis Alberto Moreno. “The replenishment of the MIF underscores a commitment to international cooperation to fight poverty through private sector development.”
Despite being the the biggest donor to the MIF for several years, the country is not participating this year. The fund was conceived by ex-president George H.W. Bush in the early 1990s as a means to boost entrepreneurship and employment in the LAC region.
The MIF contributions from Latin American countries rose to 55% in this round, rising from 8% in the previous replenishment, according to the IDB.
The goal of the fund is to promote innovative product development, generate more income opportunities for people in the region and raise the living standards of low-income people and communities.
Over the years, the MIF has funneled more than $2 billion to finance nearly 2,000 projects, becoming the region’s largest technical assistance donor. Its financing supports small projects backed by businesses, foundations, and non-governmental organizations.
Among other innovations, the MIF was a pioneer in supporting the development of microfinance. Currently it focuses on projects involving climate-smart agriculture, inclusive cities and the knowledge economy.