Japan’s International Cooperation Agency (JICA) announced on Tuesday a $1 billion contribution to a fund aimed at boosting the private sector arm of the Inter-American Development Bank to finance sustainable growth across Latin America and the Caribbean.
The move marks JICA’s largest private sector fund in the region and the first with IDB Invest, which has prioritized leveraging financing through the “originate-to-share” strategy.
This model seeks out and starts investment opportunities in the region, syndicating portions of these investments to investors instead of retaining them until maturity.
The goal is to release capital for rapid reinvestment in new projects and to amplify impact, as Latin America and the Caribbean face an estimated $99 billion annual sustainable financing gap, according to Organization for Economic Co-operation and Development (OECD) estimates.
In a joint statement, JICA and the IDB said that, subject to mutual agreement, the new fund has the potential to expand to $1.5 billion after three years.
“This initiative will not only catalyze private investment but also foster sustainable development, innovation, and economic growth in the region,” said IDB President Ilan Goldfajn.
