In a bold move to strengthen financial resilience, the African Development Bank (AfDB) and the Inter-American Development Bank (IADB) have renewed a $3.2 billion risk-sharing agreement.
Signed during the World Bank/IMF Spring Meetings, this marks the fourth such deal by AfDB since 2015, aimed at freeing up capital for development without new funding from shareholders.
The agreement enables both banks to exchange sovereign exposures, diversify portfolios, and increase funding for key infrastructure and climate projects across Africa and Latin America.
AfDB President Dr. Akinwumi Adesina said the deal aligns with G20 goals of multilateral cooperation to expand development impact.
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IADB President Ilan Goldfajn emphasized the dual benefit of boosting institutional credit strength while preserving the banks' capacity to tackle urgent regional needs.
Analysts say such innovations mark a shift in global development finance, with MDBs leveraging shared risks to scale up sustainable lending.
With combined economic pressures mounting, the renewed pact stands as a model of financial engineering that strengthens the Global South without adding debt burdens.
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