Barbados has received its second loan for the year from the Inter-American Development Bank (IDB) less than 30 days after its first.
This loan is double the amount approved in January, yet it has a shorter repay time and a shorter grace period.
This latest loan is to help the country complete the Sustainable Development Policy Program.
On January 11, 2024, Barbados was approved for a US $50 million loan to help the island boost the climate resilience of its coastal areas and foster climate-resilient economic development.
Yesterday, Wednesday, February 7, 2024, the IDB approved a US $100 million loan that allows Barbados to continue modernising its policies, laws and regulations as it strives to achieve sustainable development. The operation is the third in a series of three policy-based loans designed to enhance how Barbados plans its land use, controls development, and manages its water resources, natural assets, resilience, and disaster risk.
According to IDB press release, in Barbados, sustainability is key because most development opportunities are related to tourism and natural assets which are largely located in coastal areas.
“The way land and environmental risks are managed in these areas is critical. Also, Barbados gets its drinking water from underground, so pollution risks must be controlled in the context of changing rainfall patterns. The country’s location and exposure to climate change also make disaster risk policies especially important in safeguarding lives, investments, and the economy.
“The operation is expected to benefit the country’s entire population of nearly 300,000 people. Programs for coastal zone management, resilience, and disaster management will have a larger effect on low- and middle-income households, which are more vulnerable to climate impacts.
“The loan, which has been approved by the IDB’s Board of Executive Directors, will help advance ongoing regulatory reforms to improve land-use planning, control over development, water resource management and natural asset management. The reforms also aim to enhance resilience and disaster management. Other measures include protocols for more systematic private sector involvement in disaster response which will strengthen a facet of post-disaster governance. This affected households. Another reform includes policies and protocols for retrofitting low and middle-income homes to improve their resilience in the face of hurricanes and storm-force winds.”
This IDB loan has a 20-year repayment term, a 5.5-year grace period and an interest rate based on the Secured Overnight Financing Rate (SOFR). Meanwhile, the US $50 million loan from last month for coastal resilience has a 23.5-year repayment term, a seven-year grace period and an interest rate based on the SOFR.
