CIFI, 20 years after transforming the investment vision
Twenty years ago, the Corporación Interamericana para el Financiamiento de Infraestructura (CIFI) changed the way the investment world was perceived. Or perhaps it is more accurate to say that it changed the way investments perceived the world, especially Latin America and the Caribbean.
CIFI is a regional non-banking financial institution created in 2001. Its founders understood that responsible investments could help ensure a better future for humanity. Thus, CIFI was conceived to fill a gap in a niche market, that of sustainable infrastructure investments. This was a niche seldom considered for financing. However, they anticipated that the infrastructure needs of Latin America and the Caribbean would attract the attention of both governments and the private sector.
As a financial entity, CIFI adopted a long-term vision while making an immediate commitment. It focused on supporting small and medium-sized infrastructure projects ranging from US$50 million to US$200 million in Latin America and the Caribbean. This was a niche that was rarely considered for financing; however, CIFI’s visionary team took a close look at the market and anticipated that the infrastructure needs of Latin America would attract the interest of governments and the private sector. They were confident in themselves and believed in the potential of an entire region, as well as in the capabilities of its people. They also had the courage to set new paths for financial activities.
The team’s first initiatives were successful and increased its determination. They also became more familiarized with the business and its actors, therefore confirming that there was a great need for investment in the middle markets of Latin America and the Caribbean. Just as they had observed, both private and institutional investors were interested in finding a bridge between their investment capital and the real economy. They saw that there were stable long-term opportunities, and that new creative business models and new investment categories were available. Most importantly, they sought to support projects that met the following objectives:
- build a legacy
- help in the development of Latin American nations
- promote progress for people living in the communities
- protect the environment
How does CIFI manage to combine these elements? The answer lies in its business model. The organization focuses on finding solutions for the customer, as well as on risk assessment and mitigation. It targets technically, financially, socially and environmentally feasible projects. Therefore, it can not only approve loans, but also efficiently address other customer needs. CIFI's vision and commitment have led it to consider a variety of products to structure and finance projects, from the construction to operation and maintenance.
CIFI has the ability to attract capital through its strategic relationships for short and long-term debt, bridge loans, revolving credit lines, subordinated debt, acquisition financing, unsecured shares, performance guarantees, etc.
This twenty-year-old entity began its operations in Washington. In 2016 it decided to establish its headquarters in Panama. This move was due to the multiple advantages that the city offers, including its geographical position as it is close to every country in the American continent, in particular Central America, and therefore to the projects in said region. In fact, Central America accounts for 33% of all projects CIFI has financed, followed by the Andean region with 25% of the projects.
CIFI’s trajectory has been recognized internationally. Throughout these past 20 years, various institutions and organizations have granted CIFI very significant awards. The most recent award was granted by the Climate Bonds Initiative in July 2020. This is an international organization that works to mobilize resources from capital markets to projects that fight climate change.
Because of the entrepreneurial DNA with which it was built as a brand and company, CIFI was aimed at being a leader in project financing in Latin America and the Caribbean. Today, it stands out in the region as a reference partner in the financial activity sector. It relies on a particular approach to credit granting. Its in-depth knowledge of the region and its unique shareholding make CIFI the ideal ally for companies, governments and international developers when structuring the financing of new or expanding projects.
CIFI envisioned 20 years ago that responsible investment would be vital for development. Now, two decades after its creation, the market and governments are increasingly demanding its expertise in this area and its experience in ensuring that its projects have a positive impact in the region.
To date, CIFI has generated more than 12,000 jobs, has avoided more than 933,000 tons of CO2 emissions and has operated under the highest international ESG (Environmental Social Governance) standards. Currently, while clean energy is the fastest growing sector, CIFI is the regional leader with more than 200 projects developed. Of these projects, almost 50% are on renewable energy. Now, while investment in infrastructure projects in Latin America is crucial to generating a better future for all, CIFI celebrates 20 years dedicated to developing the region’s full potential in over 18 different countries. CIFI has invested over 1.7 billion dollars working in sectors such as clean energy, transportation, telecommunications, construction, water sanitation, waste management, and several more.
It all started with the vision of a team focused on an investment model capable of helping international shareholders identify the best investment opportunities in the region through consultancy, structuring and financing for the development of infrastructure projects in Latin America and the Caribbean.
Today, CIFI is a bridge between investors and the real economy. CIFI, the Inter-American Corporation for Infrastructure Financing, has been working on the best vision for investing in Latin America and the Caribbean for twenty years.
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