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Inter-American Development Bank (IDB) Definition


The Inter-American Development Bank (IDB) is an international financial institution dedicated to fostering development in the American region, primarily through loans and grants. Established in 1959, the IDB supports projects that target poverty reduction, infrastructure, health, and education amongst others in Latin America and the Caribbean countries. It is the largest provider of development finance in the region.


The phonetic pronunciation for “Inter-American Development Bank” would be: “in-ter-uh-mer-i-kuhn dih-vel-uhp-muhnt bangk”. In terms of definition, the Inter-American Development Bank (IDB) is an international organization established in 1959 that provides long-term loans and grants to promote economic development in Latin American and Caribbean countries. It is the main source of multilateral financing in these regions. It aims to reduce poverty and inequality, bring about development in a sustainable, climate-friendly way, improve health and education, and advance infrastructure.

Key Takeaways

Sure, here is the information about Inter-American Development Bank (IDB) in html numbered form:

  1. The Inter-American Development Bank (IDB) is a cooperative development bank founded in 1959, making it the oldest and largest source of funding for economic, social, and institutional development in Latin America and the Caribbean.
  2. The IDB provides loans, grants, and technical assistance with the aim of reducing poverty and inequality, promoting education and infrastructure development, modernizing the state, promoting regional integration and fostering free trade, and prudently managing natural resources.
  3. The member nations consist of 48 countries, including 26 Latin American and the Caribbean borrowing members, who have a majority ownership, along with 22 non-borrowing countries from North and South America, Europe, and Asia. Thus, it includes a wide international representation in its composition.


Understanding the term Inter-American Development Bank (IDB) is important in the realm of business and finance because it refers to the largest source of development financing for Latin America and the Caribbean. It’s a crucial financial institution that supports economic growth and social development by lending funds and providing technical assistance to its member countries. Its main goal is to eliminate poverty and inequality, and to bring about sustainable development. Therefore, having a proper understanding of the IDB is important for anyone involved in economic development, international business, international finance, or anyone doing business in Latin America and the Caribbean.


The Inter-American Development Bank (IDB) is an established financial institution that serves as a major source of long-term funding for economic, social, and institutional development projects in Latin America and the Caribbean. Its main purpose is to promote sustainable economic growth, reduce poverty, advance social equity, and induce development in a diverse range of areas, including infrastructure, health, education, and environmental sustainability, among the 26 Latin American and Caribbean borrower countries. The IDB also plays an instrumental role in regional integration projects, disaster assistance, and in the encouragement of micro, small, and medium enterprises. Through the provision of loans, grants, and technical assistance, the bank assists its member countries in creating plans and building projects to ensure policy reform and improved investments in these regions. At its core, the IDB is a bridge between its member countries, supporting them in the societal, environmental, and infrastructural transformations that contribute toward the overall development of these regions.


1. Infrastructure Development in Latin America: The IDB approved funding of around $11.7 billion for infrastructure development within Latin America and the Caribbean in 2019. These projects ranged from developing transportation and energy infrastructure to improving water and sanitation facilities. Thus, IDB aids in the economic growth and development of these countries.2. Financing Climate Change Projects: The IDB has been instrumental in financing climate change projects. For instance, in 2020, the IDB approved a $217 million climate-friendly program in Brazil. The program aimed to enhance the sustainability of urban infrastructure and improve the quality of public services in the country.3. Educational Programs: The IDB has also been involved in educational initiatives. In 2016, the IDB approved a $90 million loan to support Early Childhood Development Program in Jamaica. This project aimed to improve the brain development and school readiness of children up to six years old in Jamaica.

Frequently Asked Questions(FAQ)

What is the Inter-American Development Bank (IDB)?

The Inter-American Development Bank (IDB) is a cooperative development bank founded in 1959. It’s dedicated to accelerating the process of economic and social development in Latin America and the Caribbean.

Where is the IDB headquartered?

The Inter-American Development Bank is headquartered in Washington, D.C., United States.

What’s the main goal of the IDB?

The IDB’s primary goal is to achieve development in a sustainable, climate-friendly way. It supports efforts by Latin America and the Caribbean countries to reduce poverty and inequality.

How does the IDB operate?

IDB provides loans, grants, and technical assistance, and conducts extensive research to support development projects in several areas such as infrastructure, energy, social investment, environment, among others.

Who are the members of the IDB?

The IDB is owned by its 48 member countries, which includes 26 countries from Latin America and the Caribbean who borrow from the Bank, and 22 non-regional member countries.

How does the IDB benefit the regional member countries?

The IDB serves as a source of long-term financing for member countries, especially catering to the needs of less developed member countries.

Can private sector businesses get support from the IDB?

Yes, the IDB also provides loans to the private sector with an aim to catalyze the role of private business development in its member countries.

Where can I get more information about IDB and its projects?

You can learn more about IDB and its projects from its official website:

Does the IDB work in collaboration with any other entities?

Yes, the IDB frequently works with governments, civil society organizations, private sector companies, and other multilateral organizations to deliver results for its projects.

Related Finance Terms

  • Development Projects: These are the initiatives supported and financed by the IDB to promote economic growth and development in Latin America and the Caribbean region.
  • Member Countries: These are the nations that are a part of the IDB. The IDB currently has 48 member countries, of which 26 are from Latin America and the Caribbean region.
  • Capital Increase: As a bank, the IDB can increase its capital to secure more funds for its projects. This is usually done with the consent and contribution of its member countries.
  • Emerging Markets: These are countries that have some factors of a developed market but are not fully developed. The IDB dedicates a lot of its efforts towards improving the economic status of these markets in Latin America and the Caribbean.
  • Sustainable Development: The IDB places a high emphasis on promoting projects that lead to sustainable economic, societal, and environmental development in the region.

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