About the BOP market in Latin America
- People living at the base of the economic pyramid (BOP) have incomes below $3,000 in local purchasing power, living in relative poverty.
- In Latin America the market for the base of the pyramid is estimated at $509 billion a year, including 360 million people, representing 70% of the region’s population but only 28% of total household income.
- Most people in the BOP have limited access to financial and basic health services, live in informal housing, have poor access to telecommunication, water and sanitation services and electricity. They usually pay a much higher price for basic services than wealthier people and they lack access to markets to sell their labor and products, having to rely on middlemen.
IDB Investment in BOP
- The IDB invests in the development and promotion of BOP business models in Latin America and the Caribbean though Opportunities for the Majority, an initiative created three years ago.
- Since 2008, OMJ has invested $160 million to support 24 BoP projects in the region in sectors ranging from education, health care and housing to microenterprise development and projects including small farmers in supply chains for international companies.
- OMJ currently has projects in nine countries in the region. By 2015, these projects are expected to benefit more than 2.2 million people.
- In December, OMJ approved its first BOP project in Brazil. It approved a $10 million loan to help major wholesale distributor Tenda Atacado, Ltda. enhance its credit program for low income micro entrepreneurs in the food services sector in the state of Sao Paulo, Brazil.
- In 2011, the initiative expects to approve financing for three additional projects in Brazil, in the areas of enterprise development, education and financial services.
The Next $4 Billion: Market Strategy and Business Strategy at the Base of the Pyramid, International Finance Corporation and World resources Institute.