IDB assembly addresses climate crisis and poverty

The board of governors of the Inter-American Development Bank (IDB) began its annual meeting in the Panamanian capital on Thursday with a call to Latin America to face persistent challenges such as poverty, accentuated by the pandemic of COVID-19, and other more recent ones such as the climate change crisis.

The assembly will last four days and brings together finance representatives from the 48 member countries of the international financial organization, one of the main sources of credit for the public sector in the region.

“Women and historically disadvantaged groups are still woefully underrepresented in our region’s workforce,” said Ilan Goldfajn, IDB President. “Consequently, they tend to earn less income and have fewer opportunities to prosper. This is a self-reinforcing vicious cycle and we need to break it,” he noted.

According to information from the IDB, in recent decades, between 2000 and 2019, poverty in Latin America and the Caribbean fell by 52.6%, and extreme poverty by 63%. However, COVID-19 generated a rebound both by going from 28.1% in 2019 to 34.7% in 2020.

According to the entity’s approach, inequality and poverty must be tackled by improving the quality and efficiency of education and health and by reforming active labor and social protection policies, which include unemployment insurance and pensions.

On the challenge of climate change, the IDB president highlighted that Latin America and the Caribbean is one of the richest regions in biodiversity on the planet. “We can call it natural capital,” he said, noting that “it can and should be managed sustainably for optimal social, economic, social and environmental benefits.”

In the four-day meeting, topics such as aid to countries to reduce their carbon footprint or the need to move quickly towards renewable energy will be addressed.

The IDB president also highlighted the importance of increasing investment in infrastructure in Latin America and the Caribbean. The region has invested less in this area than other developing regions in recent decades. According to information from the multilateral, Latin America has invested 1.8% of its GDP in this area during the last decade, less than half that of the emerging economies of Asia.

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