Demand for IDB Programs

More than 50 million people have risen above the poverty line between 2003 and 2008. But development challenges persist.

Around 190 million people continue to live in poverty. Of these, 65 million who are extremely poor. One in every 12 children aged five or younger are underweight and more than half of the employed population works in the informal sector with little access to social safety nets.

The IDB has identified two major challenges for the region to achieve sustainable poverty reduction:

• Foster equality of opportunities
• Close the growth gap while contributing to global environmental sustainability

As a result, the Region needs to invest in key areas like productivity and economic growth; trade and poverty; water and sanitation; transportation; education; gender and diversity; climate change adaptation and the transition to a low-carbon energy matrix. These are areas where IDB involvement can make a substantial contribution to growth and equity. They are also areas where the IDB can leverage its comparative advantage on the basis of prior experience, good practice, innovation, and ongoing investments in the development of policy-oriented knowledge.

According to IDB estimates, the region needs to invest annually an additional $436 billion to close the economic and social gap with OECD and middle-income Asian nations. For example:

• $145 billion more on health
• $92 billion a year more on roads
• $93 billion more on social safety nets
• $20 billion more to adjust gross capital formation to climate change
• $19 billion a year more on education
• $15 billion more on telecommunications
• $3 billion more in water and sanitation

Multilateral banks like the IDB, which invest in development projects if the social returns are high, can help fund these costs working with governments and the private sector.