DISASTER LOAN

By Shawn Cumberbatch shawncumberbatch@nationnews.com

Barbados could be on the verge of strengthening its disaster and climate resilience through $60 million in assistance from the World Bank.

On April 10, the international financial institution’s board of executive directors is expected to consider a Disaster Risk Management Development Policy Loan of that amount, with a Catastrophe Deferred Drawdown Option (Cat DDO).

This would be separate financing from the $108 million Beryl Emergency Response and Recovery Project which the World Bank’s hierarchy approved on November 21 last year “to support Barbados’ recovery from the impacts of Hurricane Beryl”.

The proposed loan with Cat DDO, which is to be implemented by the Ministry of Finance, Economic Affairs and Investment, “is to enhance the Government of Barbados’ institutional, technical and financial capacity to manage risk, resulting from the occurrence of natural or health-related hazards, including the adverse effects of climate change and disease outbreaks”.

Details are shared in a programme information document prepared by World Bank senior disaster risk management specialist Doekle Geert Wielinga and senior economist Anton Dobronogov.

It stated that the planned loan arrangement “is a stand-alone operation designed to strengthen Barbados’ disaster and climate resilience”.

“The proposed [loan] with Cat DDO operations aligns with and directly supports the Government’s efforts to enhance disaster risk management and resilience, as articulated in the Barbados National Comprehensive Disaster Management (CDM) Policy 2022 and the CDM Country Work Programme 2019-2023,” the document explained.

“These key policy frameworks establish a strategic vision for managing disaster risks and building resilience to natural hazards, climate change and public health emergencies.

“The Cat DDO strengthens the Government’s capacity to implement these frameworks by providing timely and predictable financing, ensuring fiscal resilience in the face of disasters while incentivising the continued implementation of disaster risk reduction reforms.”

The World Bank document added that “the operation’s expected key results are designed to enhance Barbados’ disaster resilience in key sectors and financial preparedness, in alignment with the country’s strategic priorities for addressing natural and climate-driven hazards and their fiscal impacts”.

The expected “key results” from the loan programme include an increase in the percentage of fiscal instruments available for immediate disaster response, ensuring timely financial mobilisation during emergencies; a reduction in the time required to disburse emergency funds after a disaster declaration, enabling more rapid recovery and response; and enhanced resilience in the fisheries sector, combined with an improved coastal zone and storm water management, which will contribute to sustainable development and disaster risk reduction.

The document further outlined that the Cat DDO operation supports two pillars.

The first one is strengthening financial resilience against natural hazards and climate change.

This programme “is expected to improve financial preparedness, enabling Barbados to quickly mobilise resources and mitigate the economic impacts of disasters and public health emergencies; support fiscal resilience against natural hazards and climate change; and strengthen the institutional framework to better manage public assets and post-disaster expenditures”.

The second pillar is integrating climate and disaster resilience into sector development, which includes “sectoral reforms to reduce disaster risks and promote sustainable development aims to enhance the resilience of Barbados’s blue economy, particularly by safeguarding tourism, fisheries, and coastal resources”.

The World Bank document said the [loan] with Cat DDO operation was aligned with the priorities outlined in the institutions new country engagement note for Barbados.

On February 11, the World Bank Group announced its endorsement of the new country engagement note for Barbados, “formally marking a new phase of engagement with Barbados and the country’s return to the International Bank for Reconstruction and Development (the World Bank Group’s lending arm).

“The new Country Engagement Note will focus on knowledge and analytics, pipeline programmes, and partnerships on two key objectives – strengthening climate resilience through disaster mitigation and greening the energy and water sectors [and] improving conditions for growth by attracting more private investments and improving education and skills,” the World Bank said.