IDB received US$20mn in contributions and pledges from Canada, Mexico, Spain and the US for a trust fund that will support projects aimed at reducing cross-border trade, transport and logistics costs and expand trade in Latin America and the Caribbean, the multilateral lender said in a press release.
Trade within the region is still "far below" potential due to insufficient regional infrastructure, trade facilitation measures and trade regulatory architecture, IDB said. "Cross-border projects could help lower those transaction costs, boost export capacity and lead to a better distribution of trade benefits."
IDB said it will work with governments in the region to identify priority projects, with an emphasis on Central America and the Caribbean.
To promote such projects and leverage its traditional lending with new financing mechanisms, IDB established a multi-donor integration fund that complements its Fund for Integration Infrastructure (FIRII), the release reads.
Colombia has also expressed interest in contributing to the fund, according to the release.