Roles of Borrowing/Non-Borrowing Countries:

Borrowing countries (26 Latin American and Caribbean nations) are expected to provide a portion of the cost of the entire project, sometimes in the form of human capital. In addition, only firms from member countries, both borrowing and non-borrowing (such as the United States, Canada and Japan) are eligible to compete for contracts (and/or may formulate new project proposals) for IDB-funded projects.

Borrowing countries have ministries or agencies called “executing agency” that implement projects. These agencies have the following roles:

- To originate projects for presentation to IDB Headquarters, with the final decision on loan approval made by the IDB Board of Executive

- To make key decisions throughout the project cycle, including planning the project and conducting all aspects of the procurement process.

Roles of IDB Staff:

The IDB supervises the projects to ensure that its guidelines and policies, including procurement policies, are followed. Each department assigns specific project team as primary points of contact for each project. Sectoral divisions of each regional department have technical experts in areas such as environment, energy, transportation, modernization of the state, technology, etc. In general, IDB staff in Washington, D.C. is responsible for the preparation of the project for approval by the IDB Board of Executive Directors, while IDB staff located in borrowing countries is responsible for the supervision of projects that are being implemented.

The Project Cycle:

The project cycle at the IDB begins with the identification of potential financing during the IDB programming missions to its 26 borrowing countries and ends with evaluation of a project after implementation, a process that lasts years.

- In the identification phase, broad issues and parameters of a project, such as project cost and executing agency, are identified.

- During the preparation stage, details of the project are further developed. This work tends to be done by the executing agency, with the assistance of IDB staff at Headquarters.

- Once the IDB’s Board of Executive Directors approves the loan, the project goes into the execution, or implementation phase. The borrowing country is responsible for execution of the project, including all procurement. Therefore, in most cases, firms doing business with IDB-funded projects will be working most closely with the borrower, not the IDB itself.

There are potential business opportunities for U.S companies during each phase, and sometimes it is important for firms to start business development and marketing activities in the early project development phase. U.S. firms should develop and follow a strategy regarding the project cycle. For example:

-Small companies may wish to focus on trying to get business during the project preparation cycle, which offers smaller contracts;

-Larger firms may choose between doing project preparation and project implementation work (doing preparation work may preclude a firm from working during the execution phase);

-Some firms may choose not to do project development work, but focus instead on marketing their solutions to a government with the aim of having their products or services incorporated into the executing agency’s project plans.