Barbados will promote environmental sustainability and economic development with a U.S. $100 million guarantee approved by the Inter-American Development Bank (IDB) that will enable the island to create a long-term instrument to finance measures related to sustainability and marine conservation.
The government has set an aspirational target of 30 per cent of the island, which has 92 kilometres of coastline, to be dedicated to conservation as a Marine Managed Area (MMA).
The IDB guarantee will help reduce borrowing costs for the country as it seeks to raise funds for conservation activities, which includes the creation of a conservation trust fund, known as the Barbados Environmental Sustainability Fund.
“The operation, which is structured as a policy-based guarantee, will also support reforms to improve environmental governance and sustainable debt management in Barbados,” the IDB said.
“In addition, it will support capacity-building in project execution within the responsible Ministry of Finance, Economic Affairs and Investment.
“The beneficiaries of this project will be the citizens in Barbados who will enjoy the environmental and economic benefits of new protected areas and an enhanced natural capital.”
The project is the first where the IDB employs a guarantee to help a country create a long-term financing framework to use sustainable bonds for conservation measures.
This is also the first IDB public sector guarantee being delivered in collaboration with a non-governmental organisation – The Nature Conservancy, a global environmental non-profit organisation, is expected to provide a co-guarantee of U.S. $50 million.
The IDB guarantee has a maximum duration of 20 years.
(CMC)
