The Caribbean Development Bank (CDB) is moving to create a “financing ecosystem” to support the rescue, recovery and repositioning of its Borrowing Member Countries’ (BMCs) economies to meet immediate needs and propel long-term growth and development.
CDB President, Dr Gene Leon said the institution will marshal financing for a range of innovative instruments that will enable its BMCs to reorder their economies for future growth and prosperity even while continuing to navigate recovery amidst current challenges.
“To meet the region’s development needs, and for the attainment of the SDG goals, we need to approach our financing needs in a wholesome manner, addressing both the existing debt stock problem and flow financing for development. This would require a wide spectrum of financing instruments that is underpinned by a strong regulatory environment and a well-developed financial market infrastructure,” Dr Leon said at the CDB’s Annual News Conference, held virtually.
Propositions outlined by the Bank President included contingent debt instruments to incentivise countries to undertake reforms to lower their debt risk, which will make future financing more affordable. He also cited Special Drawing Rights-denominated resilience bonds for climate financing; and Sustainable Development Goals (SDG) themed bonds for activities designed to meet specific SDGs.
The adroit financing framework was one of several anchors Dr Leon outlined in his presentation entitled “Priorities for Growth and Development in the Caribbean”.
Another proposal is for the creation of a secure, zero-divide regional digital network grid to facilitate enhanced services in trade, education, health, commerce, security and justice, and government service delivery.
The CDB President also recommended greater focus on fostering social resilience by leveraging digital technology, to enhance health services, and to increase capacity by promoting problem solving, knowledge creation and innovation in regional education systems. He also prescribed greater use of renewable energy sources and energy efficiency to accelerate the region’s shift to sustainable energy.
In addition, Dr Leon stressed the importance of improving implementation capacity in BMCs by strengthening technical capacity, improving planning and delivery mechanisms and enhancing monitoring, evaluation and governance.
“Our development challenge is not merely to recover lost ground and close the distance to achieving the Sustainable Development Goals, but to fundamentally alter the development path so that our societies can be placed on a higher and more sustainable welfare path in the future,” Dr Leon said.