A successful partnership Inside the Caribbean Foreword As the World Bank Group, we are providing a wide range of financing, knowledge and convening services. Together with our Caribbean partners, we are working on strengthening macroeconomic management, support reached more than $2 billion in the region by September 2017 – of which almost $1 billion is in concessional financing from the World Bank’s International Development Association (IDA). Under supporting growth-enhancing reforms, promoting opportunities for all, the three year IDA18 cycle, US$630 million will be available to six and building resilience to climate change in order to put the region back eligible CARICOM countries: Dominica, Grenada, Guyana, Haiti, Saint The Caribbean has signif- on a path for sustainable and inclusive growth. As part of the World Lucia, and Saint Vincent and the Grenadines. This is complemented by icant economic potential Bank Group’s overall engagement with CARICOM countries, ongoing substantive analytic and advisory support. and growth opportuni- ties. It also faces serious challenges on account of Growth its high volatility, expo- FOSTERING GREATER FOCUS ON RESULTS, PILOTING PV SOLAR IN sure to external econom- TRANSPARENCY AND ACCOUNTABILITY THE EASTERN CARIBBEAN ic shocks and high public Launched in 2012 in partnership with the Caribbean Development Bank, To reduce the high cost of energy and ease the Inter-American Development Bank, and other partners, the Caribbean Caribbean countries’ dependence on oil and debt levels. One of the Growth Forum has evolved into a region-wide social compact that engages fossil fuels, the World Bank is supporting greatest challenges is its governments, businesses, and civil society to craft and deliver pro-growth diversification of the region’s power sector by 2,500 reforms. To date, some 2,500 people have contributed to Forum discussions, increasing production of renewables and other vulnerability to climate and 12 participating countries have passed over 100 reforms to boost skills clean energy sources. In the Eastern Caribbean, change and natural disasters, unleashing and productivity, strengthen logistics and connectivity, and improve the this involves working with Saint Lucia, business climate. people have Grenada, and Saint Vincent and the Grenadines damages that in the case of some small na- contributed to Forum to demonstrate the use of commercial-scale Examples of successful reforms include: a one stop shop for entrepreneurs tions can be even larger than annual GDP. in the Dominican Republic that cut the time to register a business from 45 discussions, and 12 solar photovoltaics (PV) on rooftops. participating countries BRIDGING THE INFRASTRUCTURE GAP to seven days, and a new commercial court in St Lucia which helps expedite THROUGH PUBLIC-PRIVATE PARTNERSHIPS Recognizing these challenges, building resilience and resolve commercial disputes. have passed over is a key priority for the countries. Their natural 100 In May 2015, the World Bank Group, in collaboration with the Caribbean Development Bank and Inter-American Development Bank, launched the beauty and reputation as tourist destinations is reforms Public Private Partnership Support Facility to increase the technical capacity a major draw for key North American and of Caribbean governments in infrastructure development. Last September, the IMPROVING INVESTMENT initiative sponsored a series of infrastructure “boot camps” that trained private European markets. Their rich ocean resources CLIMATE IN JAMAICA sector, government staff and practitioners from 20 Caribbean governments drive the “Blue Economy” in these small in key aspects of PPP development and implementation. A project screening To strengthen competitiveness facility has been launched, helping countries to screen their pipeline and economies. Their small size also makes them and facilitate growth of new and providing advice on PPP projects. The Facility will also manage a web-based nimble and agile as they respond to opportunities existing Jamaican businesses, PPP Toolkit to assist governments on project-level challenges, and a “Regional the World Bank launched the PPP Unit” to provide them with ongoing advice on PPP policies and projects. for innovation and competitiveness. Foundations for Competitiveness and Growth Project. The project is To take advantage of the region’s advantages providing technical assistance to The project helps and address these challenges, innovative ap- undertake due diligence for public expand access private partnerships, ranging from to training and proaches are required both at national and re- airport, ports, economic zones, finance for gional levels. Together with our partners, the water generation, waste water and more than 300 sewage, schools and renewable World Bank Group is committed to leveraging energy. It is mobilizing private public and private resources to promote inclu- capital for strategic investments such as the Logistics Hub Initiative, small and sive growth, eradicate extreme poverty and while aiming to more fully integrate medium boost prosperity. Jamaica’s SMEs into global value enterprises. chains. It is also supporting the Our engagement builds on a long-standing design of an urban plan to redevelop Downtown Kingston. partnership with the Caribbean countries, bringing together a rich combination of financ- PROMOTING ENTREPRENEURSHIP IMPROVING ACCESS TO CREDIT FOR ing and knowledge support. We hope you will AND INNOVATION ENTREPRENEURS IN THE EASTERN CARIBBEAN enjoy learning more about our work in the Cultivating an ecosystem of entrepreneurship and Limited access to finance for micro, small LEVERAGING PRIVATE SECTOR FINANCING region.. innovation is key to boosting growth and job-creation and medium sized enterprises in the Eastern in the region. To this end, with support from the Caribbean is a key obstacle to growth in these The World Bank Group is working on a new approach to development Tahseen Sayed government of Canada, the Entrepreneurship Program countries. With no credit bureau, lending financing or “Cascade approach.” In the Caribbean, this involves allocating for Innovation in the Caribbean has provided tailored is over-collateralized, while the cyclical more resources to help governments create the right conditions for Country Director for the Caribbean training and finance to 260 entrepreneurs in the In Jamaica, the Youth effects of high non-performing loans from boosting private investments in transport, connectivity, technology, as well high-growth sectors of digital innovation and climate Employment in Digital the 2008 financial crisis have raised credit as climate resilience. In addition, the International Finance Corporation (IFC), technology, while the Women Innovators Network in & Animation Industries risk for SMEs. In response, the World Bank is helping establish an the largest global development institution focused on the private sector in Project will benefit the Caribbean has connected and offered capacity- SME credit guarantee scheme to facilitate access to credit. The emerging markets and member countries of the World Bank Group, has a 15,000 building services to more than 350 promising women scheme will be combined with support to SMEs to better prepare portfolio of $520 million (as of July 2017) across a broad range of sectors in entrepreneurs. In Jamaica, the Youth Employment in loan applications as well as support to lenders to better appraise the Caribbean, including financial markets, infrastructure, information and Digital & Animation Industries Project will benefit youth SME loans. communication technology, and manufacturing and services. This includes with training, digital work opportunities, and seed youth with training about $135 million mobilized from partnering institutions. investments in the digital and animation industries. Inclusion and opportunities for all STRENGTHENING SOCIAL SAFETY NETS IN JAMAICA The World Bank is supporting the government of Jamaica’s conditional cash transfer initiative, the Program of Advancement through Health and Education (PATH), in its goal to reach nearly 1 in 5 Jamaicans living in poverty. By offering regular payments to project participants, PATH has helped increase school attendance and vaccination rates among Cash support reaching nearly vulnerable Jamaicans. Through this support, the Ministry of Labour and Social Security is reaching the country’s poorest children and has launched a complementary scheme – Steps to Work – to help PATH beneficiaries find quality employment through job readiness, skills, and 1 in 5 Jamaicans living in poverty Macroeconomic and entrepreneurial trainings. Fiscal Sustainability Fiscal gaps and elevated public debt pose key threats to macroeconomic stability, growth, and social protection across the Caribbean. The World Bank has worked with regional partners to help Caribbean countries better manage public spending and reduce debt to sustainable levels while also protecting poor and vulnerable populations. In the context of global economic downturn, the Bank provided Development Policy Financing to Jamaica, Grenada, and the Dominican Republic to support Quality education, affordable health care, and equitable social safety pro-growth reforms and help create fiscal space. nets are key ingredients in building inclusive societies. In the Caribbean, several countries have launched innovative efforts to provide the most vulnerable, including children, with the knowledge, skills, and health SUPPORTING JAMAICA’S PRO-GROWTH they need to excel. REFORMS Jamaica has embarked on a set of ambitious reforms to fill the large infrastructure gap, and reduce the CHAMPIONING EARLY CHILDHOOD high cost of electricity and dependence on oil, DEVELOPMENT IN JAMAICA while putting its fiscal house in order. These efforts Jamaica’s comprehensive National Stra- early childhood development services to have started restoring confidence in the Jamaican tegic Plan on early childhood development help improve parenting, care, and school economy. To strengthen support for reforms, the is the first of its kind in the region. Ja- readiness for children from zero to six; and World Bank has approved a series of Development maica is one of the few countries in the provide diagnosis and early stimulation Policy Loans aimed at improving the investment region that guarantees free pre-primary for children at risk. Early years support climate and competitiveness, and public financial management. education and has the highest proportion is essential to help every child be better of children enrolled in preschool. The prepared for school and better equipped World Bank supports the scaling up of to fulfill their full potential. STRENGTHENING PUBLIC FINANCIAL MANAGEMENT IN THE DOMINICAN REPUBLIC The World Bank provided budget support to the Dominican Republic to STRENGTHENING help the government strengthen its management of public expenditures, EDUCATION IN THE and enhance the transparency and monitoring of government operations. DOMINICAN REPUBLIC In the Dominican Republic, the government recently estab- lished a National Pact for Educa- tion to improve the quality of pre-university education. The World Bank’s Support to the Na- tional Education Pact project supports the recruitment and training of primary and second- ary school to help improve stu- dent learning; better assess- MORE SUPPORT FOR INCLUSIVE ment of student learning at the GROWTH AND CLIMATE primary and secondary level; RESILIENCE IN GRENADA strengthening of early childhood RESPONDING TO ZIKA As a small and middle income island economy, Grenada development services; and the In response to the international public health emergency of Zika, the World Bank was hit hard by the 2008 global financial crisis. decentralization of public school developed a Rapid Needs Assessment tool to evaluate a country’s level of readiness Grenada’s economic recovery accelerated in 2014, management. in a health emergency, identify key gaps, and develop cost estimates of the resources driven by a strong performance of tourism and agriculture. To support needed for a scaled-up response. Guyana was one of the first countries in the region to the government’s reforms, the World Bank provided a series of budget complete the Rapid Needs Assessment and is receiving assistance to address the gaps support operations to help create sustainable conditions for private identified in equipment and procedures. investment, improve public resource management, strengthen the banking sector, and boost resilience against natural disasters. Overview of the portfolio* LIST OF ONGOING PROJECTS PER SECTORS (as of July 2017 – in US$ million) CARIBBEAN PORTFOLIO IFC COMMITMENTS IN THE CARIBBEAN AGRICULTURE SOCIAL PROTECTION & LABOR US$ millions – excluding Haiti OECS Agriculture and US$ 8.30 Jamaica Social Protection US$ 80.00 Portfolio: Grants and Co-financing: IFC commitments: IFC Mobilized Grenada Safety Net Advancement US$ 5.00 33 $196M 445.3M + $152.9M Financial Institutions 145.1 25.0 EDUCATION Dominican Republic Integrated Social active projects in trust fund mobilized Protection & Promotion US$ 75.00 13 Knowledge FY17: MIGA guarantees: Manufacturing, Agri. & Services 39.4 11.8 Jamaica Early Childhood Development US$ 26.93 Saint Vincent and the Grenadines Human countries, with commitments of 39 $107M Infra & Nat. Resources 195.4 105.7 Dominican Republic Support to the Development Service Delivery US$ 10.70 about ongoing analytics and for infrastructure National Education Pact US$ 50.00 CTT 65.6 10.5 $1B advisory services worth Guyana University of Guyana Science SOCIAL, URBAN, RURAL AND $18M Total 445.4 152.9 and Technology Support US$ 13.66 RESILIENCE Guyana Secondary Education Caribbean Regional Disaster Improvement US$ 10.00 Vulnerability Reduction US$ 56.52 Total World Bank Project Financing Under Implementation by Country WB Resources By Strategic Pillar – FY17 Guyana Early Childhood Education US$ 13.33 Saint Lucia Disaster Vulnerability 2.6% Reduction US$ 42.62 Belize Private Sector Belize Climate Resilient Caribbean 3.5% 89.6% Climate Growth ENERGY & EXTRACTIVES 6.9% 47% Infrastructure US$ 30.00 Dominica Resilience Eastern Caribbean Energy 8% Dominican Republic 17.5% Regulatory Authority US$ 5.60 Dominica Disaster Vulnerability Grenada 66.9% Jamaica Energy Security & Efficiency Reduction US$ 17.00 Macro 11% Guyana 19.3% Enhancement US$ 15.00 Jamaica Integrated Community Jamaica 38.4% Dominican Republic Distribution Grid Development US$ 42.00 OECS Countries 56.4% Jamaica Disaster Vulnerability 34% Modernization & Loss Reduction US$ 120.00 St. Vincent and the Grenadines Reduction US$ 30.00 St. Lucia Geothermal Resource Social Protection Development US$ 8.00 Guyana Flood Risk Management US$ 11.89 & Social Capital Belize Marine Conservation and Jamaica Youth Employment in Climate adaptation US$ 5.53 Digital and Animation US$ 20.00 ENVIRONMENT & NATURAL TRADE & COMPETITIVENESS RESOURCES Jamaica Foundations for Jamaica Climate Data and Information Competitiveness & Growth US$ 50.00 Management US$ 6.80 OECS Regional Tourism Belize Management and Protection of Competitiveness US$ 26.00 Key Biodiversity Areas US$ 6.09 TRANSPORT & ICT FINANCE & MARKETS Caribbean Communication Guyana Payments System US$ 5.00 Infrastructure US$ 25.00 GOVERNANCE WATER Jamaica Strategic Public Sector Dominican Republic Water & Sanitation Transformation US$ 35.00 in Tourist Areas US$ 27.50 MACRO ECONOMICS & FISCAL MANAGEMENT Grenada Resilience Building US$ 9.34 Jamaica Second Competitiveness and Fiscal Management Development Policy Financing US$ 70.00 * Excluding Haiti SURINAME Resilience to Climate Change and Natural Disasters BUILDING RESILIENCE Hurricanes Irma and Maria were a stark reminder that growing Storm Irma exposure to natural disasters represents a real threat to development prospects in the Caribbean. The World Bank initiated projects to support climate resilience and enhance disaster preparedness and emergency response in the islands of Dominica, Grenada, Saint Lucia, and Saint Vincent and the Grenadines. The focus is mainly on making infrastructure more adapted to extreme weather events and natural hazards and improving government capacity to monitor, prepare for, and finance climate risks. Securing access to financial resources before a disaster strikes is also important. In response to Hurricane Irma, the World Bang Group has also expedited preparation for a contingency line of credit like the Catastrophe Deferred Drawdown Option for the Dominican Republic, and other countries are discussing the option. Following hurricane Irma, a fast track emergency recovery project is also being prepared for Antigua and Barbuda. INSURING AGAINST NATURAL ADAPTING TO CLIMATE DISASTER RISK CHANGE IN BELIZE Nine countries in Central America and the Caribbean With a low-lying coastline and more experienced natural disasters with economic impact than 1,060 small islands, Belize is that exceeded 50 percent of annual GDP in the past one of the most vulnerable countries three decades. To address the problem, the CARICOM in the world to climate change. It has requested assistance from the World Bank to create the largest barrier reef in the Amer- the world’s first pooling mechanism to help countries icas, which supports livelihoods for access affordable insurance coverage against communities, vibrant tourism, and hurricanes, earthquakes, and excessive rainfall in fishing industries, and shelters the order to reduce their financial vulnerability. The country’s long coastline from high coastline and more than initiative resulted in the creation of the Caribbean velocity winds that cause erosion 1,060 Catastrophe Risk Insurance Facility (CCRIF), funded and coastal damage. With World by donors including Canada and the United States. Bank support to protect the country’s Following recent hurricanes Irma and Maria, seven barrier reef and marine ecosystem, small islands, Caribbean countries, Antigua & Barbuda, Anguilla, Belizeans will not only be able to sup- Dominica, Haiti, Saint Kitts & Nevis, The Bahamas, port their tourism industry, increase and Turks & Caicos Islands, will be receiving payouts their marine resources and provide amounting to US$ 48.6 million, less than 15 days sustainable livelihood opportunities • Belize after the devastating events. This regional insurance to local communities, but also miti- mechanism takes advantage of risk pooling to provide gate the effects of climate change in liquidity to respond quickly to disasters. More than 20 the most vulnerable areas. Caribbean countries can now access low cost, high quality sovereign catastrophe risk insurance. THINKING BLUE GROWTH Harnessing marine resources while preserving the Caribbean Sea’s health can help countries address key challenges such as high unemployment, low growth, food security, poverty and resilience to climate change. World Bank report “Toward a Blue Economy: A Promise for Sustainable Growth in the Caribbean” estimates that the Caribbean Sea generated $407 billion in 2012, representing almost 18 percent of Caribbean GDP, including mainland Caribbean coastal countries. The World Bank Group is accelerating progress in this area by supporting the implementation of the Eastern Caribbean Regional Oceanscape Policy (ECROP) endorsed by all 11 heads of state of the Organization of the Eastern Caribbean States (OECS), and advising governments on concrete actions to generate sustainable blue growth. World Bank Caribbean Office www.worldbank.org/caribbean Follow us on Twitter: @WBCaribbean September 2017 Editor: Christelle Chapoy Production: Alejandra de la Paz, Emily Bartels-Bland Photo credit: Melton Williams, Mary Stokes, iStockPhoto/czekma13, coastcaribbeanimages/Danielle Devaux, Wikipedia, World bank