ECLAC organizes international meeting on access to financing for subnational governments

On the morning of Thursday, August 22, a meeting entitled “Access to financing for subnational governments: key to the generation of productive development policies with a territorial focus” was held. This event brought together prominent authorities, international experts and representatives of various financing organizations, with the aim of discussing and sharing experiences on access to financing for territorial productive development in Latin America and the Caribbean.

Marco Llinás, director of ECLAC’s Productive and Business Development Division, opened the session by highlighting the three traps affecting Latin America and the Caribbean: low growth, low social mobility and weak institutional capacities. He also stressed the importance of access to financing so that subnational governments can develop effective policies. “If we really want to have deep agendas in this area, we will have to apply the logic that everyone here must put resources on the table,” said the director.

Llinás also stressed the need to support and improve productive development policies in the territories, paying special attention to how these efforts are financed. “We hope that today’s conversation will help us shed light in that direction,” he said.

In turn, Paola Pabón, provincial prefect of Pichincha, Ecuador, highlighted the structural diversity of Latin America in terms of the capacities and financing of subnational governments, which vary according to their degree of autonomy or centralization. She also stressed the importance of adapting financing conditions to each territory, “I think there should be a very important reflection on what financing and credits for development mean in such unequal territories when the same interest rates are applied, since we cannot continue to manage the same terms if we are really interested in generating financing for development,” said the provincial prefect.

The event, with more than 200 participants, was moderated by Gonzalo Criollo, executive director of ConQuito, who started the first part of the meeting with the presentation of Paul Smoke, professor at New York University, on his research “Improving Subnational Government Access to Development Finance: Options, Opportunities and Challenges”, where he analyzed the limitations of access to subnational financing in the region and offered options and challenges to improve the financing of subnational governments.

Continuing with the agenda, Noel Pérez, economic affairs officer of ECLAC’s Economic Development Division, presented the results of the joint publication prepared by ECLAC and the Inter-American Development Bank (IDB), entitled “Overview of fiscal relations between levels of government in Latin American and Caribbean countries.”

Likewise, Ángel Cárdenas, manager of Urban Development, Water and Creative Economies at CAF -development bank of Latin America and the Caribbean-, spoke about the institution’s experience in supporting the financing of subnational governments in the region and how they have addressed the challenge of territorial development in addition to identifying opportunities for innovation.

In the second part of the event, a panel of experts moderated by Natalia Genta, social affairs officer of ECLAC’s Productive Development Division, was held. This panel encouraged interaction among various key actors, focusing on two crucial questions on the topic. Participants included Michelle Guerrero, Undersecretary of Economic Development of Baja California, Mexico; Nicolás Piloni, Councilor of the City of Córdoba, Argentina; and Nicolás Mendioroz, Coordinator of the Subnational Value Proposition at CAF. The panelists discussed innovative strategies and financing mechanisms applied in the region, highlighting the experiences of subnational governments in strengthening their productive development policies.
The event concluded with a question-and-answer session, highlighting the main challenges and opportunities for improving access to financing by subnational governments. Marco Llinás invited participants to the launch of the “Panorama of Productive Development Policies in Latin America and the Caribbean,” which will be held on Thursday, September 5, where the current situation will be analyzed and recommendations will be offered to improve these efforts.