Source: Caribbean Media Corporation (CMC) news agency

Washington, 26 April - The Inter-American Development Bank's [IADB] Multilateral Investment Fund (MIF) and the United Nation's International Fund for Agricultural Development (IFAD) [on] Monday [26 April] announced the creation of a 7.6m-US-dollar programme to promote savings and investments in poor rural areas in Latin America and the Caribbean that receive remittances from migrants.

Last month, MIF announced that remittances to Latin America and the Caribbean from foreign workers reached 38bn US dollars, compared to 32bn US dollars in 2002.

The IADB estimates that 450bn US dollars' worth of remittances will flow into the region during the coming decade.

Caribbean Community (Caricom) countries were among those states benefiting from the increased remittances to the region last year.

Jamaicans working abroad sent back 1.4bn US dollars, followed by Haiti 977m US dollars, Guyana 136m US dollars, Trinidad and Tobago 88m US dollars and Belize 73m US dollars. Cuba, the only Communist state in the Caribbean received 1.2bn US dollars, according to MIF.

IADB President Enrique V. Iglesias and IFAD President Lennart Bage on Monday signed a Memorandum of Understanding (MOU) on the establishment of the MIF-IFAD Partnership Facility for Rural Private Sector Development.

''This partnership marks the first time MIF has worked with another multilateral institution,'' said Iglesias.

''We fully expect this first joint programme to capitalize the strengths of our two organizations to make remittances a true tool for development.''

Bage said that given IFAD's role in promoting sustainable rural development and IADB's financial experience in Latin America, ''this partnership will be beneficial for both institutions and, most importantly, will allow our individual institutions to develop a number of innovative pilot experiences with an important development impact on rural communities''.

Under the agreement, MIF will provide up to 4m US dollars to the joint programme while IFAD will contribute 2m US dollars.

Local counterpart organizations, such as microfinance institutions and credit unions, are expected to commit a total of 1.6m US dollars to projects they propose.

The programme will help credit unions and microfinance institutions in low-income rural areas of Latin America and the Caribbean provide better money transfer services in order to cut the costs of remittances.

It will also support non-governmental organizations and foundations that provide business development services in rural areas.

The programme will also support NGOs, foundations and other not-for-profit institutions that provide services to boost rural productivity and incomes, such as training for micro entrepreneurs, promoting joint ventures and marketing rural products or handicrafts.

Local governments and agencies will also be eligible as long as they partner with private sector counterparts, the IADB said.