Insights | Sustainable infrastructure: the bet of Díaz-Granados in CAF

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Sustainable infrastructure: the bet of Díaz-Granados in CAF

The Development Bank of Latin America (CAF) is the second largest financial institution in the region after the Inter-American Development Bank (IDB). Composed of 17 countries from Latin America, two from Europe (Spain and Portugal) and 13 private banks, CAF is in charge of promoting “a sustainable development model through credits, non-reimbursable resources and support in the technical and financial structuring of projects of the public and private sectors of Latin America. ” It was incorporated in 1968, but officially began operating in 1970.

During these five decades, CAF has played a fundamental role in supporting development projects and financing Latin American countries and companies in periods of economic recession. Last year, when the whole world was facing the ravages that COVID-19 had left, it lent 14,000 million dollars to different public and private entities in the region, in order to strengthen health services and some development projects.

That is why, in the midst of the reactivation period, the leadership that CAF may have will be essential. Hence, the appointment of Sergio Díaz-Granados as the new president of the Financial Institution is so important for Colombia. In addition, he is the first Colombian to preside over the Development Bank of Latin America-CAF, which is undoubtedly a diplomatic achievement for the country. But ¿who is the new president of CAF?

Sergio Díaz-Granados is a lawyer and specialist in Government and Finance from the Externado de Colombia University. He has worked in both the public and private sectors: he has been a congressman, president of the U party, professor and, more recently, Executive Director for Colombia at the IDB. However, the most important position he has held and for which he is best known is that of Minister of Commerce, Industry and Tourism in the first government of President Juan Manuel Santos. It was due to this experience that the candidacy of Díaz-Granados was supported by the majority of the CAF members.

And although he has not officially started in his new position, Díaz-Granados has given several interviews that show that his hallmark will be the development of sustainable infrastructure in Latin America. He told El País and El Heraldo that infrastructure has always been one of CAF’s stakes, but that doing so in an even more sustainable way would be one of the keys to development and the recovery of employment in the region. . He also pointed out that the reactivation must have a strong multilateral character, which means that the 19 countries and 13 banks that make up the CAF must provide more capital so that the entity can invest and lend to different countries and companies.

The Díaz-Granados presidency officially begins on September 1, so the agenda that he will have is not yet known, but it is already apparent that his big bet will be to make CAF “the green bank of Latin America”.

[1] Quote taken from the CAF website.

[2] Quote taken from the La República newspaper interview with Sergio Díaz-Granados on July 8, 2021.