IDB Signs China Project Pact

The IDB says it is setting up 2 partnerships with China to co-finance public and private sector projects in LatAm and the Caribbean, aimed at increasing credit flows to the region. The first agreement was signed Saturday in Medellin by IDB president Luis Alberto Moreno and vice president of the Export-Import Bank of China, Zhu Hongjie. They will collaborate to identify and invest in infrastructure projects, trade finance and other sectors hit by the global financial crisis. They also plan to jointly finance private or public sector projects of mutual interest. The second will be signed by the IDB with China Development Bank, aimed at promoting business links. The banks will co-finance projects sponsored by public and private sector entities, and support new financial products in cross-border banking. They may also engage in other joint investment programs, including project financing and credit guarantees, says the IDB. China joined the IDB in January and is contributing $350 million to fund key IDB initiatives, including soft loans for the region’s poorest nations and investment capital for SMEs.