WASHINGTON, USA – The Inter-American Development Bank (IDB) and the World Bank have signed a Framework Agreement for mutual reliance in public procurement matters related to co-financed projects in Latin America and the Caribbean (LAC). This Agreement is consistent with international good practices, is based on both institutions’ common project procurement principles and brings forth a range of opportunities for the LAC region.
The Agreement will allow the IDB and the World Bank to leverage each other’s capacities and move in a more expeditious manner, to prepare and implement projects in countries and channel much-needed resources to address the needs of the region. Both institutions recognize the importance of fostering cooperation, to achieve synergies and acknowledge the need to increase the development impact of their projects for the benefit of their borrowing member countries, within their jurisdictions.
Furthermore, this Agreement signals a coordinated and unified approach to public procurement, which is anticipated to result in increased efficiencies and the prevention of duplication of efforts in jointly financed projects.
Since both banks already employ a similar Procurement Framework that is consistent with international good practices that promote economy, efficiency, equality, fairness, integrity, transparency, quality, value for money and fitness for purpose, execution of the Agreement in co-financed projects should be seamless. In addition, implementation of the Agreement should substantially reduce transaction costs for borrowers as well as the banks, in relation to project procurement preparation, execution and monitoring.
A lead co-financier will be designated and whose procurement policies will govern the project while the other co-financier will rely on the lead’s work.