PANAMA CITY, Panama -- Despite advances in quality of life and economic growth in Latin America and the Caribbean over the past decade, more needs to be done to keep the momentum going and meet future challenges, said Luís Alberto Moreno, president of the Inter-American Development Bank.
That was a key message at the 54th annual meeting of the IDB, the main source of development financing in the region. The gathering brought together finance ministers and central bank presidents from 48 member countries and some 3,000 representatives from development agencies, banking institutions, businesses and civil society organizations.
On Sunday, the last session of the four-day meeting, the IDB board of governors approved a resolution directing the bank to come up with a proposal by Oct. 31 to better manage the bank’s lending to the private sector. As part of a $70 billion capital increase for the bank that was approved in early 2012, more resources are being made available for private sector lending.
“This is simply the first step in transforming the private sector in our region,’’ said Panama’s Finance Minister Frank de Lima, the newly elected chairman of the IDB.
During an address to the board Saturday, Moreno said the region’s economies are expected to grow by 3.6 percent in 2013. Also, a dramatic reduction in poverty, higher incomes and growth in the middleclass in the region over the last 10 years were reported
But Moreno said, “These achievements are insufficient when we look at the challenges ahead in consolidating just and prosperous societies.’’
The IDB meeting coincides with “an ever more complex international context” in which growth in many developed countries is expected to continue at low levels, he said.
And that has had a decelerating impact on regional economies. In 2008, before the full effects of the worldwide economic crisis were felt, economic growth in Latin American and Caribbean countries averaged 5 percent annually.
Much of Latin America’s recent growth also has been fueled by high commodity prices.
“The fact is that boom times don’t last forever as has been demonstrated multiple times in our history and are only fruitful if harnessed well,’’ said Moreno.
“We do not know how much longer the capital inflows that have provided us with abundant and cheap funding will last, but in large part they depend on decisions taken by central banks in the United States and Europe, and although it still seems a long way off, more costly and selective access to global savings should be included in any calculation about the future,’’ he said.
Now is the time for countries in the region to make structural reforms, Moreno said, that will “accelerate growth and consolidate social progress.”
Areas where improvements are needed, he said, are investments in roads, ports and airports, technological innovation, justice systems, fighting crime and healthcare and education. “These are indispensable initiatives to ensure that we are able to keep competing in the global economy,” said Moreno.
“Education is a priority for the region,’’ said Moreno who added that he wasn’t simply talking about increasing access to education but improving quality.