The Caribbean Development Bank (CDB) is ramping up its research activity to help regional governments better tackle challenges related to environmental sustainability, economic and fiscal resilience, and implementation.
CDB’s Director of Economics, Dr. Justin Ram, announced this at the Bank’s annual news conference, held recently in Barbados. “Taking it a step further, this year, the bank proposes to publish research that focuses on assessing and measuring the vulnerability and resilience of our borrowing member countries. This work will improve the measurement and therefore the utility of the index as one of the tools CDB uses to allocate our most concessional resources,” Ram stated.
The Director stressed the urgent need for reform and action to build macroeconomic resilience, environmental sustainability, productivity and competitiveness, and human capacity — a position outlined in the bank’s study, entitled “A Policy Blueprint for Caribbean Economies.”
Reviewing the economic support CDB provided to help countries build resilient economies and societies, the Director highlighted investments in Anguilla and the British Virgin Islands (BVI) in the wake of Hurricanes Irma and Maria in 2017.
In Anguilla, CDB provided an initial US$5.6 million hurricane recovery support loan to help the government meet external debt payments. The bank followed this with a US$9.3 million exogenous-shock policy-based loan (PBL), which aims to restore fiscal sustainability and enhance the country’s resilience against natural disasters. The BVI benefitted from an emergency relief loan of US$67 million which CDB approved in December 2017. The bank expanded this support with a US$50 million PBL in March 2018.
Ram noted that economic and financial volatility and uncertainties were at play in a number of BMCs (Borrowing Member Countries). “As such, building economic and fiscal resilience and the shoring-up of financial buffers were high priorities of the borrowing members and the bank,” he said. One such intervention included a US$75 million PBL to the government of Barbados to support implementation of the Barbados Economic Recovery and Transformation Program.
The bank is also working to assist BMCs in improving their implementation rates, another issue underlying the region’s economic and social challenges. This challenge is outlined in “Implementation: Delivering Results to Transform Caribbean Society,” a research product the Bank published last year.
“One reason why our development goals tend to be difficult to achieve is that transformation in this region is usually a slow process. Implementation rates for public projects are as low as 20 percent in some countries. In 2017, the bank was keen to better understand, and propose solutions for addressing these implementation challenges. In doing so, we investigated regional and global best practices for achieving quicker and better development results,” Ram stated. Subsequently, the government of St. Lucia approached CDB for assistance and is now benefitting from a US$5 million project to support the establishment of an implementation and delivery mechanism.
Ram said the bank’s research which includes forthcoming publications on digital transformation and regional energy markets, worked alongside the bank’s economic interventions as tools in building stronger economies and accelerating economic transformation in the region. “Transformation requires fiscal discipline, human development, environmental resilience, and an improved business environment. Our publications seek to provide our policymakers with the tools needed to chart this transformational path,” he stated.