MIGA and CAF to Drive Strategic Investments in Latin America and the Caribbean

CAF —Development Bank of Latin America and the Caribbean—  and the Multilateral Investment Guarantee Agency (MIGA), home of the World Bank Group Guarantee Platform, have signed an agreement to mobilize private capital, manage risks, and promote sustainable development in the countries of Latin America and the Caribbean. 

The agreement, signed at MIGA's offices in Washington, D.C., seals the commitment of both multilateral institutions to work together to expand financing for impactful projects in the region, particularly in critical areas such as infrastructure, financial inclusion, urban development, and climate action. 

The institutions will work to ensure that World Bank Group guarantee products support risk management initiatives within CAF's loan portfolio, thereby freeing up capital to finance additional operations. Collaboration will focus on three main areas: credit risk management through portfolio or individual guarantees issued by MIGA; capital mobilization through joint participation in the issuance of financial products; and strategic collaboration to foster cooperative efforts in other areas of mutual interest. 

This joint approach will enable both institutions to enhance the scope and effectiveness of their operations, strengthening the confidence of investors and creditors, and contributing to sustainable development and regional integration in CAF's shareholder countries. 

“MIGA’s agreement with CAF demonstrates our continued commitment to supporting sustainable development in Latin America and the Caribbean,” said Tsutomu Yamamoto, MIGA Managing Director. “We look forward to working with CAF to promote growth and job creation in the region.” 

"The signing of this agreement reflects a mutual commitment to work on operations in the region to mobilize resources and support the viability of projects that help countries achieve the Sustainable Development Goals," said Sergio Díaz-Granados, Executive President of CAF. 

The relationship between CAF and MIGA dates to 2020, with initial discussions to collaborate on mitigating the economic impact of the pandemic. After a process that included the signing of confidentiality agreements and numerous technical exchanges during 2025 on legal, risk, environmental, and financial aspects, the parties have solidified a strong foundation for this formal alliance. 

Tangible Examples and Scope 

MIGA has a strong track record in the region, with operations ranging from a USD 1.2 billion guarantee in Brazil to support smallholder farmers, to a USD 11.7 million guarantee to modernize St. Lucia’s streetlight network, and more recently a USD 229 million guarantee in Barranquilla, Colombia, focused on social infrastructure and urban sustainability.

Another example includes CAF’s two major partial credit guarantees aimed at catalyzing long-term financing for businesses. The first is a guarantee of up to USD 225 million for Banco del Pacífico, which will unlock up to USD 500 million in financing from JPMorgan Chase for Ecuadorian SMEs. This guarantee initially covers 45% of the exposure and may increase to up to 70% of the outstanding balance over a 7.5-year period. The second is a USD 75 million revolving guarantee for BancoEstado in Chile, designed to expand financing for medium and large companies through an innovative structure that partially secures a credit portfolio, helping boost lending capacity through more efficient use of capital.

The new collaboration framework with CAF will make it possible to replicate and scale the impact of these types of operations, exploring mechanisms such as joint guarantee transactions, co-mobilization of resources, business development initiatives, and joint events. A key priority area is support for subnational projects—at the municipal, departmental, and city levels—as well as solid public companies, where access to guarantees can be critical.

The agreement, which has an initial term of three years and may be renewed by mutual consent, reinforces the shared mission of both institutions to catalyze investments that drive inclusive economic growth, reduce poverty, and improve people’s quality of life. By combining their strengths, CAF and MIGA are well positioned to help close the development financing gap in Latin America and the Caribbean, attracting private capital to projects that are essential for a more sustainable and resilient future.