IDB Group and OPEC Fund Launch $3M Facility to Boost Infrastructure in LAC

The Inter-American Development Bank Group (IDB Group) and the OPEC Fund for International Development (OPEC Fund) have unveiled a new $3 million project preparation facility aimed at accelerating the development of high-quality, co-financing-ready infrastructure projects across Latin America and the Caribbean (LAC). The initiative represents a major step forward in strengthening regional cooperation and unlocking new investment opportunities for sustainable growth.

A Strategic Partnership for Sustainable Development

The agreement, signed in Riyadh during the 9th Future Investment Initiative, formalizes a strengthened partnership between two major global development institutions. It was signed by IDB Group President Ilan Goldfajn and OPEC Fund President Abdulhamid Alkhalifa, who hailed the collaboration as a model of how multilateral development banks and global funds can work together to catalyze inclusive, sustainable investment.

The new IDB–OPEC Fund Project Preparation Facility, which will be administered by the IDB, is designed to support technical cooperation in 24 eligible countries across Latin America and the Caribbean. The facility's primary goal is to create a robust pipeline of infrastructure projects ready for co-financing by the IDB, the OPEC Fund, and other development partners.

This initiative builds upon a Memorandum of Understanding (MoU) signed between the two institutions in April 2025 in Washington, where both organizations committed to deepening collaboration in project design, financing, and capacity building.

Bridging Vision and Investment

The facility will focus on pre-investment activities such as feasibility studies, environmental and social safeguards, and procurement planning—all critical steps to ensure that infrastructure projects are both bankable and sustainable.

By providing targeted technical assistance and early-stage financing, the IDB and OPEC Fund aim to help governments and private sector partners transform project concepts into viable investment opportunities.

According to the IDB, the facility is expected to help unlock over $400 million in new projects within the next five years across sectors including:

• Transport – developing sustainable mobility and logistics networks to enhance regional connectivity.

• Renewable Energy – accelerating clean energy transition through solar, wind, and geothermal projects.

• Water and Sanitation – expanding access to safe drinking water and wastewater treatment.

• Digital Infrastructure – building digital networks and promoting inclusive connectivity.

• Social Services – supporting education, health, and community infrastructure.

"This facility is a bridge between vision and co-financing-ready projects," said President Ilan Goldfajn. "It brings together the IDB's deep regional expertise and the OPEC Fund's global reach to prepare a strong pipeline of projects that will drive inclusive, sustainable development."

Strengthening Institutional Capacity

The facility is divided into two main components, reflecting its comprehensive approach to both project design and institutional strengthening:

1. Project Design and Implementation:

   • Funding for technical studies, engineering assessments, legal reviews, and monitoring systems.

   • Development of evaluation and procurement tools to ensure projects meet high fiduciary and environmental standards.

   • Support for incorporating climate resilience and gender inclusion into project frameworks.

2. Institutional Strengthening:

   • Capacity building for national and local institutions to manage and monitor infrastructure projects effectively.

   • Assistance in improving regulatory frameworks, digital tools, and transparency mechanisms.

   • Training for government officials and project managers to promote good governance and accountability.

These measures will not only help countries develop high-impact projects but also enhance long-term institutional resilience and policy coherence in infrastructure planning and management.

A Shared Vision for Regional Integration

The partnership aligns with both institutions' long-term strategies to foster sustainable, inclusive development and regional integration. The IDB has prioritized infrastructure as a driver of productivity, trade, and job creation under its Vision 2025 agenda, while the OPEC Fund has made co-financing and partnership building a central pillar of its operations.

"This collaboration with the IDB Group strengthens the foundation for future investment and growth," said Abdulhamid Alkhalifa, OPEC Fund President. "By supporting well-prepared, high-impact projects, this facility will channel more resources where they can make a lasting difference—in roads, clean energy, and digital connectivity."

The OPEC Fund, established in 1976, has financed more than 3,700 projects in 125 countries, totaling over $23 billion in development support. Meanwhile, the IDB Group is the largest multilateral lender for Latin America and the Caribbean, providing financing and technical assistance to help its member countries reduce inequality and boost competitiveness.

Unlocking the Next Generation of Infrastructure

The new facility reflects a growing recognition that quality project preparation is essential for mobilizing large-scale investment in infrastructure. Many promising projects in developing economies fail to advance because they lack technical studies, environmental assessments, or clear financing frameworks.

By addressing these bottlenecks, the IDB–OPEC Fund initiative aims to de-risk infrastructure investment and attract greater participation from private investors and institutional financiers.

Early beneficiaries of the facility are expected to include Caribbean small island states—which face acute infrastructure and climate challenges—and low-income countries in Central America and the Andean region seeking to modernize transport and energy systems.

Advancing Climate and Sustainable Development Goals

The partnership is also aligned with the Paris Agreement and the United Nations Sustainable Development Goals (SDGs), particularly Goal 9 (Industry, Innovation and Infrastructure) and Goal 13 (Climate Action). By prioritizing low-carbon and climate-resilient infrastructure, the facility will help countries build sustainability into their economic recovery and growth strategies.

As President Goldfajn emphasized, "This initiative embodies the IDB's new development vision—turning ambitious ideas into actionable, financeable projects that bring tangible benefits to people across Latin America and the Caribbean."

Looking Ahead

The IDB and OPEC Fund plan to begin implementation immediately, with the first round of projects expected to receive technical assistance funding by mid-2026. Over the next five years, the facility is projected to build a diversified portfolio of co-financing-ready projects that can attract international investment, foster public-private partnerships, and advance the region's sustainability agenda.

By focusing on project readiness, institutional capacity, and cross-border collaboration, the IDB–OPEC Fund partnership sets the stage for a new era of inclusive infrastructure development—one designed to power economic resilience, social progress, and regional integration across Latin America and the Caribbean.