IDB Report: Latin American Public Banks Show Strong Potential to Help Address Climate Change and Foster Productive Development

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Public development banks represent 10 percent of lending in Latin America and the Caribbean.

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The region’s public banks have generally ceased to be a burden on the fiscal accounts, said Fernando de Olloqui, a financial markets specialist for the IDB and lead author of the study.

Public Development Banks (PDBs) in Latin America and the Caribbean provide more than $700 billion in loans annually and possess the operational and financial heft to expand into areas such as climate change mitigation and productive development policies, according to a study released today by the Inter-American Development Bank (IDB).

The study also urges these institutions to continue to strengthen their capacity, particularly in corporate governance area, and to demonstrate their development effectiveness in a way that further mobilizes private sector resources and supports the most vulnerable economic sectors.

The study examines the relevance of the PDBs in today's financial systems, their financial and non-financial instruments, institutional factors key to achieving success, and how they can address new challenges such as climate change mitigation.

The region’s 56 PDBs include institutions such as the Banco Estado de Chile, the Banco de Desarrollo Empresarial de Colombia, and Mexico’s Nacional Financiera.

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