Byline: Marcela Sanchez

Ten years ago, the North American Free Trade Agreement created a development bank with $3 billion in capital to fund environmental projects along the United States-Mexico border. Yet to date, less than 4 percent of that amount -- about $96 million -- has been lent.

When the North American Development Bank (NADBank) was established, the intention was clear -- to be the first step toward much more U.S. assistance to Mexico to ease the pains of economic integration. Environmental projects were to be mere steppingstones.

But the bank was hamstrung by Washington's neglect. Only last week did the U.S. Congress end a four-year debate to allow it to lend money at lower than market interest rates and expand its operations from 62 miles to 186 miles beyond the Mexican border. Crippled at the outset, and still hobbling, NADBank is a clear indication of just how distant Washington's development priorities have become from those of Latin America's.

Contrast the feeble trickle of funds from the bank with the flood of money pouring into Mexico in the form of international money transfers, better known remittances. Last year, immigrants working in the United States sent $31 billion to relatives in Latin America -- more than $13 billion of that to Mexico. Salvadorans, Dominicans and Guatemalans send home billions more. While not "development funds" in the traditional sense, remittances and the hard work of Latin American immigrants in the United States are transforming conditions back home.

These funds are sent most frequently through firms such as Western Union, which charge high transaction fees and provide no other service. It is in this transition between remitter and recipient that much of the power of this capital is lost.

And it is there that financial institutions want to be. Multilateral organizations such as the Inter-American Development Bank (IDB) and other lenders, big and small, are now deeply involved in efforts to attract remitters and provide them with a less expensive and, in the long run, more productive way to send money home.

Their goal, agreed to over the weekend at the IDB's annual conference in Peru, is to increase to 50 percent by 2010 the number of families receiving remittances through traditional financial institutions.