Inter-American Development Bank (IDB): What it is and How it Works Key takeaways
The Inter‑American Development Bank (IDB) is a multilateral development bank founded in 1959 to support economic and social development in Latin America and the Caribbean.
It is owned by 48 member countries and provides loans, grants, and technical assistance.
The IDB raises lending funds by issuing AAA‑rated bonds; member capital pledges back these bonds.
In 2021 the bank financed $13.6 billion for 94 projects; by October 2022 its active portfolio comprised about 601 projects totaling roughly $56.1 billion.
The United States is the largest shareholder (about 30%), followed by Brazil and Argentina (~11.35% each), Mexico (~7.3%) and Japan (~5%). What the IDB does
Provides financing (loans and grants) and technical assistance to governments and public entities across Latin America and the Caribbean.
Helps design and implement development policies that aim to:
Promote environmentally sustainable economic growth
Increase competitiveness and regional integration
Reduce poverty and enhance social equity
Modernize public institutions and services
Support free trade and investment
* Prioritizes areas such as social inclusion, economic integration, innovation, climate action, gender equality, and diversity. Explore More Resources
How the IDB finances projects
The bank raises most of its lending capacity by issuing bonds in international capital markets.
Those bonds are backed by the IDB’s loan portfolio and by capital pledged by non‑borrowing member countries.
The IDB’s bonds are triple‑A rated, which helps keep its borrowing costs low and allows it to lend to member countries on favorable terms. Typical activities and examples
Financing infrastructure, energy, environment and climate projects; reforms to improve public sector efficiency and services; and social investment programs.
* Recent completed projects (examples from 2022) included public‑sector modernization in Suriname, Guyana, Jamaica and Barbados; social investment in Ecuador; energy projects in Mexico; and environmental initiatives in Colombia and Barbados. Explore More Resources
Governance and leadership
The IDB is owned by its member countries and governed by a Board of Governors and a Board of Executive Directors.
Presidents serve multi‑year terms; leadership shapes strategic priorities and operational focus. Challenges and priorities
The region faces persistent inequality and uneven growth—issues the IDB highlights as central to its mission.
After the end of the commodity boom in 2014, many countries experienced weak growth, increasing demand for social and economic reforms.
* The bank continues to address structural challenges while increasing emphasis on climate resilience, gender equity, innovation and inclusive recovery strategies. Explore More Resources
Why the IDB matters
By combining financing, policy advice and technical capacity, the IDB plays a central role in supporting development projects that governments may not be able to fund or implement alone.
Its AAA credit standing and pooled capital model enable sustained, lower‑cost lending aimed at promoting long‑term regional stability and growth.