CAF Development Loans Reach USD12 billion in 2013

(Caracas, Dec. 16, 2013).-"After a decade of robust economic growth, Latin America is entering a moderate slowdown phase alongside other emerging economies in a global scenario marked by a slight recovery in industrialized economies," said Enrique García, Executive President of CAF-development bank of Latin America-upon unveiling the institution's 2013 financial results. García stressed that emerging economies will still act as the world's main engine of global growth.

"However, despite the growth achieved so far in this century, Latin America faces structural challenges that limit its development," García said, adding that "the region must move forward following a comprehensive agenda that leads to growth that is both robust and sustained as well as growth that generates inclusive employment. To do this, we must substantially improve our productivity, diversify exports and reduce the size of the informal economy."

In this context, García emphasized the need to invest more in infrastructure, education, and in research and technological innovation as well as in strengthening the region's institutions

García also stressed the need to accelerate Latin American integration efforts, as "the region will not be fully competitive until it achieves real and pragmatic integration."

2013 Results

In 2013, CAF was one of the main sources of multilateral financing for Latin American development projects.

The institution made significant progress strengthening operational and financial activities by approving a record USD12 billion in loans, which far outpaced goals set for the year. Demand for CAF financing from governments and public-sector entities in shareholder countries to fund various investment projects and other programs was particularly strong, including contingent credit lines and credit facilities granted to public institutions and regional development banks.

Elsewhere, CAF deepened its support for the private sector to promote productive economic and social transformation, either by funding projects directly or by participating in credit lines and co-financing arrangements with commercial banks. Working with the private sector served as the institution's mission to act as a catalyst to attract financial resources into the region via participation in A/B loans or the approvals of partial credit guarantees and equity investments in funds operating in the region, which helped leverage CAF's financial contribution to Latin America's development.

Special mention goes to CAF's ongoing support from shareholder countries, whose cash capital contributions exceeded USD900 million in 2013, which formed part of three capital increases totaling USD6.3 billion planned for the 2007-2017 time frame.

"CAF efforts aim to accompany development plans in countries across the region under a broader Latin American development agenda" said García.

"But beyond the financial products and services CAF offers, the institution plans to make major strides promoting research and development as well as generating and sharing knowledge on key developmental issues," said García, adding that "CAF constantly strives to innovate in matters of organization, products and processes to enhance its relevance for partner countries."

García also stressed that CAF adhered to an intense institutional relations agenda at both regional and global levels, which positioned the financial institution as a model for other regional development financial banks and as an active member of the International Development Finance Club (IDFC).

CAF's relationships with universities and prestigious thought centers include the London School of Economics, Oxford University, Sciences Po, the Universidad de Alcalá de Henares, Institute of Latin American Studies at Chinese Academy of Social Sciences (ILAS-CASS), the Global Development Network, the Inter-American Dialogue, the Brookings Institution, Harvard and Johns Hopkins Universities as well as university networks and other academic institutions in Latin America.

A Year of Recognition

In 2013, CAF received ratings upgrades from Japan Credit Rating (AA- to AA) and Fitch Ratings (A+ to AA-). Furthermore, Moody's and Standard & Poor's affirmed their CAF ratings and maintained stable outlooks.

Additionally, CAF was voted asBest Multilateral Development Bank of The Yearby LatinFinance Magazine, the leading source of value-added financial markets intelligence for Latin America and the Caribbean. LatinFinance praised CAF's Latin American development efforts: "the bank's catalytic effect on economic development is heightened through its expertise, capacity to encourage solid policies and encourage the pursuit of sound projects," said the magazine in its November 2013 edition.

Separately, the institution continued implementing strategies to diversify funding sources through its participation in high-caliber capital markets, specifically through 16 bond issues in 2013 that raised more than USD2.65 billion, which strengthened the institution's reputation among a very select group of issuers. The placements also highlighted CAF's role as a development catalyst by drawing funding from various sources across the globe into Latin America to promote investment and trade opportunities in the region.