Barbados has stood out as the strongest performers among five Caribbean countries benefiting from policy-based loans (PBLs) provided by the Caribbean Development Bank (CDB).
That is the finding of an Evaluation of Policy-Based Lending Operations at the Caribbean Development Bank 2017-2025 published by the CDB’s Office of Independent Evaluation.
The analysis, which also included Antigua and Barbuda, Dominica, St Lucia and The Bahamas concluded overall that the CDB “should continue using PBLs but ensure clear policy and institutional additionality through complementary operations grounded in technical assistance”.
A section of the report focused on Why Barbados Worked – Lessons From A High-Ownership Model, and it noted that “the Barbados case stands out as the strongest performer among the five PBL countries evaluated”.
“Several factors differentiated it from other cases and offer transferable lessons for future PBL design,” the report stated.
In this regard, the following takeaways were outlined as transferable from Barbados to other countries using CDB PBLs.
A home-grown reform programme with a medium and long-term vision preceding the PBL.
Having a multi-partner coordination framework.
A programmatic design with built-in continuity. Strong technical specificity in prior actions. Dedicated technical assistance from specialised partners complemented the PBL.
Benefiting from a Social Partnership oversight mechanism.
Combine budget support
“PBLs achieve strongest results when they support nationally-owned reform programmes that pre-exist the financing request, operate within multi-partner coordination frameworks, combine budget support with dedicated technical assistance, and embed oversight mechanisms that extend beyond the Ministry of Finance,” the section dedicated to Barbados stated.
Barbados’ PBL efforts were anchored on the Barbados Economic Recovery and Transformation (BERT) programme.
“BERT was developed by the Government of Barbados before seeking international financial institutions’ support, not in response to donor conditionality,” the evaluation report noted.
“Prior actions reflected policy commitments embedded in the Government’s own reform agenda, rather than measures introduced primarily to meet external financing requirements.”
In terms of geographic distribution, the CDB publication said the institution’s PBL resources were concentrated among the smallest and least developed CDB members, except for Guyana in 2025, which totalled US$125 million.
“The Bahamas accounted for the largest volume of approved funding, with two programmatic operations – each consisting of two tranches – totalling US$265 million, followed by Barbados – one programmatic operation totalling US$150 million, St Lucia – two PBLs totalling US$61.9 million, and the British Virgin Islands – one PBL totalling US$50 million,” the report shared.
Sustained reforms
The evaluation indicated generally that PBLs are more likely to contribute to sustained reforms when they are cross-sector integrated from the outset, rather than primarily economics-led; anchored in coherent reform trajectories coordinated across sectors and development partners; designed around broader reform pathways rather than discrete prior actions; and supported by grounded technical assistance designed alongside the operation and focused on institutionalising reforms beyond disbursement.
“The analysis further shows that reliance on ex post evaluation and limited post-disbursement follow-up constrains the depth of reform and organisational learning. This insight points to the need for a more systematic engagement that builds on CDB’s comparative advantage, learning, and adaptation,” the report stated.
It added that such an approach should enable sector-integrated course correction during implementation; strengthen PBL governance and incentive arrangements that support reform continuity and sustainability; and prioritise development impacts rather than speed of disbursement.
“In practical terms, this would require institutionalising structured post-disbursement engagement through ongoing evaluation and a diversified set of monitoring, evaluation, and learning methods embedded within dynamic learning loops,” the evaluation report advised.
“These systems would enable continuous feedback, adaptive course correction, and sustained policy dialogue beyond loan closure.” (SC)