Panama Commits to Economic Development through IDB and CAF
Panama has taken a major step toward strengthening its economy by joining the Inter-American Development Bank’s (IDB) Multilateral Investment Fund IV. The Cabinet approved a national contribution of $5.53 million, to be distributed over four equal annual installments from 2025 through 2028.
This strategic decision aligns with Panama’s long-term goals to empower its private sector and stimulate sustainable investment. The Multilateral Investment Fund, managed by the IDB, promotes innovation, competitiveness, and inclusive growth across Latin America and the Caribbean.
By joining this fund, Panama gains access to technical assistance, financing programs, and private-sector development tools designed to enhance economic resilience and diversification.
Panama IDB CAF: Loan Adjustments for Strategic Development
In parallel, Panama has modified a loan agreement with the Development Bank of Latin America (CAF). Originally signed in 2020 for $50 million to address the COVID-19 pandemic, the agreement was partially canceled in 2022—reducing the available funds to $37.5 million.
The revised agreement redirects resources toward the “KfW Water and Climate Program,” an initiative focused on regional water management and climate resilience. Financial terms have also been updated, including a 1.75% interest rate and a spread benefit of 87 basis points over the six-month LIBOR.
For more information about CAF’s environmental programs, visit CAF’s official site.
Panama Joins IDB Fund and Modifies Loan – Positive Outlook for Sustainable Growth
Panama Joins IDB Fund and Modifies Loan – These decisions reflect Panama’s commitment to sustainable and inclusive economic development. By strengthening partnerships with institutions like the IDB and CAF, Panama enhances its ability to implement infrastructure, environmental, and social programs that benefit the nation long-term.
To stay informed about Panama’s financial strategy and regional growth, visit Panama Perspective.