US $200m approved by IDB
The Inter-American Development Bank (IDB) has approved a US$200 million loan designed to help revive the Barbados economy.
In a statement issued today, the development financing institution said the new Country Strategy would focus mainly on “priority sectors” during the four-year period of the loan.
It said that strategy placed greater emphasis on the foreign currency-earning sectors and was aimed at contributing to the mitigation of risks from external shocks, including changes in commodity prices, natural disasters and the impact of climate change.
Significant attention is also given to support private sector competitiveness and improved efficiency in service delivery within the public sector.
It listed the four priority sectors “for supporting interventions aimed at addressing microeconomic constraints to Barbados’ growth” as tourism, transportation and logistics, energy and integrated coastal zone management and climate resilience.
Public sector modernization and social protection and labour markets are also earmarked for “strategic interventions” during the 2015-2018 period.
“The selection of these priority sectors reflects areas in which the IDB and the Government of Barbados can most readily engage to support growth,” the New York-headquartered bank said.
It said the new Country Strategy for Barbados, prepared in close consultation with the Government, was “validated by many stakeholders” in civil society, the private sector and the donor community.
It further stated that the programme was aligned with the government’s priorities which were included in the 2013-2020 Barbados Growth and Development Strategy.
“The new Country Strategy will support the diversification of source markets for Barbados’ tourism sector, both in terms of geography and traveller segments. The Strategy will also support the upgrade of road works and improvements in air connectivity and maritime logistics, particularly as it relates to the handling of larger container ships,” it explained.
“In the energy sector, the promotion of renewable energy and greater efficiency is expected to have a positive impact on reducing energy costs. Given Barbados’ reliance on coastal tourism for employment and growth, integrated coastal zone management will continue to be an important focus of the new Country Strategy,” it added.
Some of the challenges to be addressed, it said, included the assessment and valuation of the services provided by coastal and marine ecosystems, incorporating innovation in engineering for coastal resilience, financial sustainability of coastal investments and coastal risk governance.
The Bank pointed out that the previous programme from 2009-2013 was already having “a sound impact” on the energy sector and on coastal resilience.
“The reform of the energy sector included the introduction of a new regulatory framework, promoting the use of renewable energy and energy efficiency measures. Coastal infrastructure works have been completed on the West Coast and have controlled erosion, stabilized beaches, improved public access and facilitated recreational activity for locals and visitors.
“In addition, a detailed assessment of coastal hazards and risks, designs for coastal protection on the South Coast and a pilot programme to restore coral reefs are underway,” it said.
The Bank also noted that its longstanding collaboration with the Barbados Government in coastal resilience had resulted in several programmes including that of the Barbados Coastal Zone Management.
“Significant strides were also made in education, and key country systems were modernized in areas such as standards, procurement, and statistics,” it added.
The financing agency said it contributed US$242 million to the Barbados economy between 2009 and 2013 and it is currently the largest multilateral partner supporting the public sector investment programme.