Date: April 2, 2008

Author: Jane Bussey

Source: Miami Herald 

Months in advance of the Inter-American Development Bank's annual meeting, the U.S.-based staff played musical chairs -- with a wholesale switching of offices at the Washington headquarters in a move that underscored the sweeping changes in the organization.

The Inter-American Development Bank that comes together for its annual meeting at the Miami Beach Convention Center from Friday until next Tuesday is not only a far cry from the organization it was in 1987 -- the last time it met in South Florida -- but also a different organization than it was just a few years ago.

The bank, which makes development loans and grants in the Americas, has a new organizational structure and new programs as it attempts to streamline lending to bring it more in tune with changes in the economies of Latin America and the Caribbean.

When IDB President Luis Alberto Moreno took the helm at the bank in October 2005, he launched a reorganization to help the bank regain relevance and become more responsive and more flexible.

One of his key efforts was to move staff from Washington to the Latin American and Caribbean countries that are the actual borrowers.

At the end of 2007, 516 staff members from a workforce of 1,745 were in the field. The bank expects the majority of 250 future hires will work in the Americas to better understand the financial needs of borrower countries and to expedite loans.

Symbolic of Moreno's desire for change was last year's staff shake-up. About 229 bank employees took buyouts; management jobs were shuffled, and the staff at the Washington headquarters changed offices en masse just before Christmas as part of the reorganization.

Miami executive Jorge Arrizurieta, chairman of the Miami 2008 Host Committee for the meeting and who served as U.S. representative to the development bank from 2001-2003, said the physical move emphasized the sense of change.

Not surprisingly, there was opposition from staff members.

''The irony is that the bank is going for structural adjustment, the same kind of bitter medicine that they forced their clients to go through in the last 20 years,'' said Vince McElhinny, manager of the Latin America and Caribbean program at the Bank Information Center, a Washington organization that monitors lending agencies.

The money IDB lends to the 26 borrowing countries in the Americas have traditionally come with strings attached, often requiring borrowers to implement tough economic reforms, known as ''structural adjustment'' programs.

Part of the reason for seeking a new direction at the bank -- which was founded in 1959 to promote economic development in Latin America and the Caribbean -- is the recent economic success of the region.

Although the countries are still plagued with poverty and inequality, economies have been relatively stable for half a decade. They can more easily access other financing, from regional development agencies like the Andean Development Corp., to commercial bank lending in their own countries.

Now, instead of lending almost exclusively to governments, the development bank has increased its funding to the private sector and opened up lending to states and cities, rather than just national governments.

To match lending competition in the region, the IDB has increased its loans. In 2006, it lent $6.3 billion. Last year, loan approvals rose to just over $11 billion.

When the bank met in Miami in 1987, the region was immersed in a debt crisis, later known as the ''lost decade.'' Through the 1990s and into this decade, meetings were often overshadowed by financial implosions and banking crises throughout the hemisphere.

In contrast, this year's meeting is expected to help regional financial leaders gauge the impact of the U.S. subprime crisis on their own economies.

''We are in different territory,'' said Moreno. ``This financial turmoil did not originate in Latin America.''

Moreno said that so far the region has been insulated, but that could change.

''We have to be mindful of how this turbulence continues to develop,'' Moreno said.

U.S. Treasury Secretary Henry Paulson, Microsoft's Bill Gates and about 6,000 others -- finance ministers and central bank presidents from the region, civil society representatives, IDB executives and staff and top bankers and business executives -- will attend the five-day event at the Miami Beach Convention Center.

''This meeting should mark an interesting moment because of the uncertainty in the global economic situation and whether this realignment will bear fruit,'' said Nancy Birdsall, a former executive vice president at the development bank and founding president of the Center for Global Development in Washington.

The Miami Herald is one of the media partners for the annual meeting.