The Inter-American Development Bank boosted its lending for Latin American economic and social programs by 18 per cent to a total of $1.8 billion, it said yesterday in its annual report.

But the lending institution will have to increase its resources substantially to keep up the pace of its activities, bank president Antonio Ortiz Mena told reporters.

Ortiz Mena is scheduled to present the bank's annual report and to raise questions about replenishment of IABD funds at its 19th annual meeting that opens this morning in Vancouver, Canada.

The IABD is the major source of outside public financing for Latin American development. It is supported by 41 countries, including seven new members who joined last year - Austria, Finland, France, Italy, the Netherlands, Sweden, and the Bahamas.

An expansion of membership and financing support from outside the Americas in the past couple of years has given the institution a truly international character, with 26 members from the region and 15 from outside the hemisphere.

The bank's lending emphasis continues to be on boosting the growth rate of its poorest members, and on projects that serve basic human needs. In aggregate terms, Latin American countries enjoyed a good year in 1977, with a real economic growth rate over 5 per cent.

This is somewhat below peak growth periods of the 1960s and early 1970s, but almost double the recessionary 3 percent growth rate of 1975. The annual report suggests that a return to a more satisfactory higher growth pattern is unlikely unless "without a vigorous expansion in the economies of the industrialized countries."

A problem for the IABD that does not appear in its annual report is the determination of the Carter administration to deny financial assistance to those countries that violate its concept of human rights.

The United States, as a principal contributor to the IABD's concessionary Fund for Special Operations has a veto power over the payment from this fund (FSO). The practical result of the U.S. human rights position is that countries that anticipate a U.S. veto of an application on human rights grounds tend to apply for regular loans, instead of "soft" FSO loans.

IABD sources concede that so far, the net effect of the U.S. human rights stand has merely been to make it more expensive for a few countries to borrow money from the agency. The FSO loans are generally at 2 percent for 40 years. The regular loans are 7.5 percent for 25 years.

Records of the agency show that the U.S. has abstained from approval of at least three rregular loans that would have been blocked if they had come in on an FSO basis. One of these was to Chile for a $30 million rural health program. The others, one for $12 million, and another for $30 million, reportedly were to Argentina and Uruguay. There was no formal discussion of human rights in these cases, nor was human rights cited as the reason for abstension.

The United States, sources said, may in the future consider a lessening of its share of the FSO funds, while others contribute a greater share of the concessional aid, reducing the U.S. control over distribution of the FSO. This will be discussed at the Vancouver sessions, which continue through April 19.

The u.S. is by far the largest financial supporter of the IADB, but currently is behind in its pledges, as is true for commitments to other international financial institutions.

For the fiscal years 1976 through 1978, Congress authorized $600 million a year for the IADB, including $200 million in paid-in contributions to the FSO, and $400 million in ordinary capital, of which 10 percent is paid-in and the balance callable. A Treasury spokesman said that as of last Friday, the U.S. was behind $264.1 million in total pledges. The IADB was formed in 1959 by the United States and 19 Latin American countries. Canada, in 1972, was the first country outside of the southern hemisphere to join up. Since then , the membership has expanded to Europe, Asia, and the Middle East.