Mexico becomes a full member of CAF and strengthens its presence in Latin America
Within the framework of the 50th anniversary of CAF - Latin American development bank - the institution's executive president, Luis Carranza Ugarte, signed with the Secretary of Finance and Public Credit, Arturo Herrera Gutiérrez, the incorporation of Mexico as a full member of CAF, which marks a key milestone after three decades of joint work and will allow the country greater access to long-term financial resources, technical cooperation for sustainable development and a permanent seat on the Board of the multilateral, among other benefits.
During the signing ceremony, the Executive President of CAF, Luis Carranza Ugarte, stressed that "this is a very clear demonstration of the confidence placed in CAF and of the Mexican Government's political will and interest in deepening working ties with the institution, as well as strengthening its relationship and integration with the countries of Latin America, which is especially important in the current situation due to the COVID-19.
For his part, the Secretary of Finance and Public Credit, Arturo Herrera Gutiérrez, stressed the importance of strengthening the international agenda in these times when the COVID-19 has made visible the need for greater cooperation between nations and institutions. "CAF is an extraordinarily noble institution with the idea of contributing to the development of countries," he stressed.
Mexico was the first non-Andean country to join CAF as a Series C shareholder in 1990, when the presidents of the Andean Community invited the member countries of the Latin American Integration Association (LAIA) to join the bank. Since then, the institution has played a significant role in supporting Mexico's venture capital industry through investments in funds, with an emphasis on business development for small and medium enterprises.
CAF has provided substantial support to Mexico through the granting of revolving credit lines in favour of Nacional Financiera (NAFIN), Banco Nacional de Comercio Exterior (Bancomext) and the public trust fund Fondo Especial para Financiamientos Agropecuarios (FEFA). Similarly, in recent years, strategic financing has been provided to the telecommunications sector and in favour of the implementation of public policies regarding transparency and regulatory improvement. In this regard, at the beginning of the year, a USD 300 million loan was formalised, establishing a set of actions aimed at reducing the cost of regulations, lowering obstacles and simplifying procedures and services for both citizens and businesses.
President Carranza reaffirmed to Secretary Herrera the commitment of CAF to the productivity and development agenda in Mexico, an aspect that is essential to generate the conditions that allow the good performance of economic activity, to encourage business activity and, in general, to promote the rules that stimulate greater innovation, investment, economic growth and consolidate social welfare.
CAF began operations in 1970 with a capital of US$25 million provided by the five founding countries (Bolivia, Colombia, Ecuador, Peru and Venezuela). Today there are 19 shareholder countries (including Spain and Portugal) and more than $47 billion in assets and around $13 billion in equity. Its historical evolution makes CAF one of the few success stories of integration in Latin America.