China to invest $2 billion in IADB Latin America investment fund

Visitors are attend the second day of the of the Inter-American Development Bank (IDB) meeting in Panama City March 15, 2013. REUTERS/ Carlos Jasso

PANAMA CITY (Reuters) - China will invest $2 billion to back Interamerican Development Bank (IADB) public and private sector projects in Latin America and the Caribbean, the development bank said on Saturday.

The contribution by the People’s Bank of China will be used to co-finance up to $500 million in IADB public sector loans and up to $1.5 billion in private sector credit, available over the next three to six years, the IADB said in a news release.

The goal of the fund was to alleviate poverty and boost competitiveness.

China has invested tens of billions of dollars in the region, from Mexico to Argentina, over the last decade to acquire strategic assets or companies in sectors such as oil, minerals and food products.

Last March, China’s export-import bank and the IADB announced a joint $1 billion dollar fund for private and public sector investment in the region, reflecting the country’s eagerness to link up with prominent institutions in the region.

Writing by Tomas Sarmiento and Alexandra Alper; Editing by Doina Chiacu