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IDB Invest and Japan’s JICA announce US$1B fund to boost private investment in Caribbean

Feb 21, 2025 News

TOKYO — IDB Invest and the Japan International Cooperation Agency (JICA) announced a US$1 billion contribution from JICA to establish the JICA Trust Fund Achieving Development of Latin America and the Caribbean (TADAC).

This landmark initiative – the agency’s first private-sector fund with the IDB and its largest private sector fund in Latin America and the Caribbean – aims to catalyze greater private investment by co-financing projects that drive sustainable growth. As Latin America and the Caribbean face a growing financing gap, IDB Invest – the Inter-American Development Bank’s private-sector arm – is adopting an “originate-to-share” business model, emphasizing collaboration and co-financing with other development institutions to mobilize private investment and maximize capital efficiency. The TADAC Fund will further strengthen these efforts.

In this context, the TADAC Fund will provide IDB Invest with additional resources, streamline co-financing with JICA by reducing duplication, and leverage IDB Invest’s expertise. Additionally, subject to mutual agreement, the Fund has the potential to expand to US$1.5 billion after three years.

The TADAC Fund aligns with IDBImpact+, a new approach that unifies the work of the IDB, IDB Invest and IDB Lab under one goal to increase our impact and scale, while enabling private sector investments, promoting innovation, and increasing the financing capacity of IDB Invest.

“This US$1 billion fund represents a historic milestone in our ongoing partnership with JICA – the agency’s first private-sector fund with the IDB and its largest private-sector fund in Latin America and the Caribbean. By leveraging our combined resources and expertise, we are poised to drive transformative change across Latin America and the Caribbean. This initiative will not only catalyze private investment but also foster sustainable development, innovation, and economic growth in the region,” said IDB President Ilan Goldfajn.

Dr. Akihiko Tanaka, President of JICA, emphasised the importance of this collaboration, stating that “JICA is committed to supporting private-sector efforts to solve the deep-rooted social issues in Latin America and the Caribbean. This investment in partnership with IDB Invest will contribute to closing the financial gap to achieve the SDGs in the region.”

TADAC’s creation marks a new milestone in the collaboration between the IDB and JICA. For over 40 years, JICA has been a trusted partner in Latin America and the Caribbean, becoming the IDB’s largest bilateral aid agency. In 2011, the two organizations formalized their partnership through a co-financing agreement, which later evolved into the Cooperation for Economic Recovery and Social Inclusion (CORE) framework. In 2024, JICA expanded CORE’s funding to $4 billion, significantly increasing resources for co-financing and co-investment in key areas such as quality infrastructure, disaster risk reduction, universal health coverage, poverty alleviation, and climate mitigation.

Through the CORE framework, JICA has also strengthened its collaboration with IDB Invest and IDB Lab. For example, JICA and IDB Invest co-invested over US$20 million in Dr. Consulta, a Brazilian health-tech company, marking JICA’s first equity investment in Latin America and the Caribbean. Additionally, JICA partnered with IDB Lab on the TSUBASA Program, which supports Japanese startups tackling development challenges in the region.

(IDB Invest and Japan’s JICA announce US$1B fund to boost private investment in Caribbean)

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