Director Felix Fernández-Shaw Represents the European Commission at the 16th International Economic Forum on Latin America and the Caribbean

The 16th International Economic Forum on Latin America and the Caribbean took place in Paris on 22 May 2024 and focused on scaling up financing for development. The event, which was organized by the OECD Development Centre, the Inter-American Development Bank (IDB) and the French Development Agency (AFD), was divided into two main sessions and concluded with a ceremony in honour of Enrique Iglesias, former President of IDB, Minister of Foreign Relations of Uruguay and Secretary-General of the Ibero-American General Secretariat.

Introductory remarks, in which Mathias Cormann (OECD Secretary General), Anabel González (IDB Vice-President for Countries), Thomas Melonio (AFD Executive Director for Innovation, Strategy and Research) and Ragnheiður Elín Árnadóttir (OECD Development Centre Director) intervened, underlined the opportunities that the Latin America and Caribbean region has to advance in the path of sustainable development and to lead globally in areas such as renewable energy or food security. Despite challenges such as growing demands for democracy, tight budgets and the climate change crisis, strong partnerships among public and private sector can reach impact and scale for development. All speakers emphasized the commitment of their institutions to the region and their shared values.

The first session addressed mobilisation of sustainable development finance, particularly actors, policies and instruments. Renata Vargas Amaral, Secretary for International Affairs and Development of Brazil, opened the discussion linking the current climate crisis in Rio Grande do Sul, Brazil, and the need to better articulate and improve the existing mechanisms to finance climate adaptation. She mentioned the relevance of national transition plans as well, the need to incentivize replication and to improve technical assistance in catastrophic scenarios.

Félix Fernández-Shaw, Director for Latin America and the Caribbean and relations with all Overseas Countries and Territories at the Directorate-General for International Partnerships of the European Commission, presented the Global Gateway Investment Agenda for the region and its promotion of European private investments. This agenda goes beyond investment on extractive and commercial sectors and strives to increase productive investment with a focus on innovative technologies, social impact, vocational training and gender equality, while boosting standards to the highest international levels. The Global Gateway strategy seeks to reduce dependency of Latin American and Caribbean economies and encourages governments and companies to use public funds to achieve the green and inclusive digital transitions. Together with local governments, the European Commission has already identified key projects to accomplish this mission, many of which are aimed at decarbonizing transport in the region. “Latin America and the Caribbean have much to offer (...), they have a very similar agenda to the European Union and in terms of the inclusive green and digital transitions, the European Union and Latin America and the Caribbean have a lot in common.”

Other speakers were Amélie de Montchalin, Chair of the Governing Board of the OECD Development Centre, who stressed the disincentivizing role of international financial regulation to invest in countries of the Global South, which penalizes particularly Latin America and the Caribbean, as it receives less ODA than other regions of the world. Daniel Hojman, President of BancoEstado, Chile, highlighted the need for articulation of international organizations, local governments, private sector and the local population. For him, existing instruments need to be better directed to less-served sectors and presented the example of the Green Hydrogen Facility where public and private sectors from Chile and Europe work together to create a whole new sector in the economy. Rafael Barraza, Executive President of Banco Agrícola, El Salvador, came back to the importance of coordination between public policy and private investment and focused on the need to promote financial inclusion and to replicate best practices. Finally, Rodolfo Sabonge, Secretary General of the Association of Caribbean States, pinpointed the need for integration and coordination among countries beyond specific organisations, interconnecting infrastructure and policies. Most speakers agreed that blended finance and risk-sharing mechanisms are useful tools to leverage further resources and achieve greater impact, although barriers in terms of regulation, knowledge-sharing and replication capacity remain.

The second session's focal point was innovative finance and counted with the participation of César Ferrari, Financial Superintendent of Colombia, Irene Gómez Luque, Wayra CEO, Djalal Khimdjee, Proparco Deputy CEO, Cecilia Tam, Head of Energy Investment at the International Energy Agency and Diego Amondaray, Co-founder and CEO of Nippy. Venture capital was among the main topics of discussion of this session, and it was agreed that, although investing in Latin America and the Caribbean might seem risky, there are plenty of interesting ideas and projects. For entrepreneurs looking for finance, it is important to do in-depth research on the many tools already available, such as Angel Investor Clubs, innovation labs, public financing or knowledge-sharing platforms. Investors were encouraged to learn more about the vibrant scenario that the region represents for investment, with many start-ups responding to the needs of local communities and looking to escalate their businesses.

As a conclusion, moderator Ragnheiður Elín Árnadóttir, stressed the importance of forums such as this one for the purpose of stimulating dialogue and keeping the Latin American and Caribbean perspective on the global agenda, specially ahead of the fourth International Conference on Financing for Development, which will be held in July 2025 in Spain.