The Diplomat
The First Vice President and Acting Minister of Economic Affairs and Digital Transformation, Nadia Calviño, and the Executive President of the Development Bank of Latin America (CAF), Sergio Díaz-Granados, signed yesterday in Santiago de Compostela an agreement for the subscription of Spanish shares in the capital increase of the institution for an amount of $302 million (269 million euros).
In March 2022, CAF’s Board of Directors approved by consensus the institution’s tenth equity strengthening, the largest in its history, with a capital increase totaling $7 billion. Last July, the Council of Ministers authorized Spain’s participation in the capital increase of the institution.
The signing of the agreement took place at the Monasterio San Francisco Hotel Monumento in the Galician capital, on the margins of the informal Ecofin meeting, which is being held this Friday and Saturday, and the first-ever meeting of the European Union’s Ministers of Economy and Finance and governors of national banks with their counterparts from the Community of Latin American and Caribbean States (CELAC).
“Spain celebrated last year the 20th anniversary of its incorporation to the institution and reaffirms once again with the signing of the agreement its commitment with CAF-Development Bank of Latin America to promote sustainable growth in the region from a financial, environmental and social point of view,” stated the Ministry of Economy in a press release. Spain had previously participated in other capital increase processes of the institution.
“We will continue working together with our brothers on the other side of the Atlantic for the internationalization of Spanish companies, to channel new financial resources to the region and increase cooperation in different areas of development in Latin America, such as energy transition, sustainability, digitalization and the fight against climate change,” stressed Nadia Calviño after the signing.
This contribution from Spain to CAF came a day after the president of the Official Credit Institute (ICO), José Carlos García de Quevedo, and the executive president of CAF, Sergio Díaz-Granados, signed in Madrid a new ICO International Channel Line agreement worth 300 million dollars to promote sustainable and digital development projects in Latin America and the Caribbean that in turn support Spanish business activity. The operation is the eighth that both entities have closed as a result of their collaboration for more than 25 years.
Following the signing of the agreement, Nadia Calviño spoke yesterday at the CLXXIX meeting of CAF’s Board of Directors, the body responsible for establishing the entity’s policies, appointing the executive president and approving lending operations, the annual expenditure budget, the granting of guarantees or investments. The Board brings together 20 countries from the Americas and the Caribbean, as well as Spain and Portugal, and thirteen private banks from the region.
Meeting of EU and CELAC ministers
The first day of the informal Economic and Financial Affairs Council (Ecofin), within the framework of the Spanish Presidency of the Council of the EU, is scheduled for this Friday in the Galician capital. The meeting includes the first meeting of Ministers of Economy and Finance of the European Union and Latin America and the Caribbean, which will be attended by representatives of a hundred delegations, including the heads of 60 countries representing 14% of the world’s population and 21% of the world’s GDP. A total of 47 ministers and leaders of the main multilateral financial institutions, including the International Monetary Fund (IMF), the World Bank, the Inter-American Development Bank, CAF and the OECD, will participate.
The event will address issues such as economic security, strategic autonomy, monetary and fiscal policy coordination and the Global Gateaway investment agenda, agreed in July during the EU-CELAC Summit in Brussels to strengthen cooperation between the two regions and take advantage of opportunities for sustainable and inclusive growth.
They will also discuss the need to strengthen the global financial safety net, following up on last weekend’s G20 leaders’ summit in New Delhi and with a view to the upcoming annual meetings of the IMF and World Bank, to be held in October in Marrakech. Tomorrow, Saturday, EU ministers and central bank governors from both regions will discuss the interaction between fiscal policy and monetary policy in the current economic climate and how to address current and future priorities and challenges.
