A. M. 
Sustainable financing instruments in Latin America and the Caribbean reached a cumulative value of US$164.4 billion in 2024, consolidating their position as a key avenue for mobilizing resources toward the region’s productive transformation. This figure, equivalent to 27.2% of total bonds issued by Latin America and the Caribbean in international markets, contrasts sharply with the 9.3% recorded in 2020 and reflects significant progress in the adoption of financial mechanisms geared toward sustainable development, according to a recent report by the Organización para la Cooperación y el Desarrollo Económicos (OCDE).
The study, Latin American Economic Outlook 2025: Driving and Financing Productive Transformation, highlights that the growth of green, social, sustainable, sustainability-linked, and blue bonds opens a window of opportunity to channel investment toward strategic sectors. These include renewable energy, sustainable infrastructure, digital connectivity and technology-intensive industries, key areas for diversifying economies and increasing the added value of regional production.
This dynamism in sustainable financing is complemented by the performance of foreign direct investment (FDI), which reached 2.8% of regional GDP in 2024, primarily concentrated in projects related to energy transition, digitalization, and technological development. The OECD emphasizes that this type of investment not only provides capital but also facilitates the transfer of technology and knowledge, essential elements for strengthening productivity and competitiveness.
However, the report warns that structural limitations persist in the region’s financial markets. Market capitalization represents only 37.4% of GDP, well below the 64.4% observed in OECD economies, which restricts access to long-term financing. In this context, development banks and development finance institutions have assumed an increasingly important role in boosting productive capacity.
A key focus is support for micro, small, and medium-sized enterprises (MSMEs), considered fundamental for employment and economic diversification. According to the OECD, 32% of these institutions’ portfolios are geared toward supporting this segment, facilitating their access to credit and promoting their integration into higher value-added activities.
The report also highlights the importance of strengthening regional cooperation and policy harmonization to maximize the impact of sustainable finance. Coordinated investment in energy, transportation, and digital connectivity would reduce costs, improve efficiency, and accelerate the transition to a more resilient, low-carbon economy through regional initiatives such as integrated energy markets and cross-border digital corridors.
In conclusion, the OECD argues that sustainable finance has become a key tool for the economic development of Latin America and the Caribbean. Leveraging its growth, along with coherent public policies and greater regional integration, will be crucial for boosting investment, modernizing economies, and moving toward more inclusive and sustainable growth.
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