Risk capital is a good option for financial development
In his opening remarks, García said that risk capital contributed to quality economic development by stimulating efficient companies that act in innovative sectors with positive externalities for economic growth, and creating incentives for private sector investment by finding finance for high risk and high return activities that cannot normally be financed in the traditional sector. Risk capital also promotes equity by investing in sectors - such as agroindustry - where adoption of new techniques and new forms of value added increases productivity, and contributes to the development of capital markets because the success of the undertakings gives them access to new types of financing such as debt issues, or to financing from institutional investors such as Pension Fund Managers (AFPs).
The CEO added that CAF’s experience in risk capital dates back to the mid-1990s when it began to invest in investment funds to support the development of various sectors (energy, infrastructure, growing companies, financial and capital markets, etc) in Latin American countries. In 2002 CAF increased its support for this type of financing by creating the Business Development Investment Fund, FIDE, which is a venture capital fund for development of SMEs in its member countries. With an initial commitment of US$15 million from the Corporation, FIDE has so far approved 40 operations for about US$13.1 million, and is structuring a further six operations for US$5.9 million.In these 10 years of CAF risk capital activity, the results have been positive. Now based on its experience the Corporation is planning to deepen its future operations by making "intelligent" capital investments (mix of financial resources plus technical capacity), promoting a catalytic role in attracting additional resources by channeling contributions from other multilaterals, private banks, investors, national and local governments etc, at the same time as seeking new allies and designing innovative financing solutions that respond to business needs.
CAF's more recent content
![CAF, JICA and Sicredi join forces to support women and rural producer CAF, JICA and Sicredi join forces to support women and rural producer](/media/4669796/foto_sicredi_divulgação_310724.jpg)
CAF, JICA and Sicredi join forces to support women and rural producer
The amount represents the largest international facility ever undertaken by Sicredi, with the involvement of four internationally renowned entities: Banco Finantia, BNP Paribas, Eco.business Fund, and Sumitomo Mitsui Banking Corporation (SMBC). The funds raised can also be used in regions with a Human Development Index below the national average.![CAF-FAO: Digitization project for agribusiness with repository launch CAF-FAO: Digitization project for agribusiness with repository launch](/media/4669830/caf-fao.png)
CAF-FAO: Digitization project for agribusiness with repository launch
The Food and Agriculture Organization of the United Nations (FAO), CAF -development bank of Latin America and the Caribbean-, the Ministry of Agriculture, Land and Fisheries and the Tobago House of Assembly celebrated the successful completion of the “Digitization and Innovation for the Competitiveness and Sustainability of the Agribusiness Sector in Trinidad and Tobago” project. The closing ceremony, that took place on the 29th of July, marked a significant milestone in the country's efforts to modernize and enhance the agricultural sector.![CAF recognizes Panama's water potential in the face of climate change CAF recognizes Panama's water potential in the face of climate change](/media/4669780/2_cuencas_hidro_caf_.jpg)