St Vincent and the Grenadines will receive US$40 million to strengthen its fiscal sustainability efforts and improve its climate and disaster resilience to future shocks.
In the short term, the funds will also boost the country’s response to the ongoing coronavirus pandemic.
“This operation supports the efforts of Saint Vincent and the Grenadines to maintain fiscal resilience and protect lives and livelihood during the COVID-19 pandemic, which has led to severe socio-economic impacts.”— World Bank Country Director for the Caribbean Tahseen Sayed
Yesterday, the World Bank Board of Executive Directors approved a 40-year loan to support the Caribbean country’s Second Fiscal Reform and Resilience Development Policy Credit with Catastrophe Deferred Drawdown Option (Cat DDO).
“This operation supports the efforts of Saint Vincent and the Grenadines to maintain fiscal resilience and protect lives and livelihood during the COVID-19 pandemic, which has led to severe socio-economic impacts,” Tahseen Sayed, World Bank country director for the Caribbean, stated in a release.
The Cat DDO also provides a US$20-million contingent line of financing in the event of future natural or health-related disasters.
According to Sayed, “The contingent financing component protects people against the effects of a natural disaster and helps the country become more disaster-resilient.”
Due to the COVID-19 prevention measures, Saint Vincent and the Grenadines has experienced a loss of economic activity. The country is also at high risk of natural hazards, especially hurricanes.
With financing from the World Bank Cat DDO, St Vincent and the Grenadines can now support reforms that strengthen the legal and institutional frameworks for disaster risk management, protect jobs and livelihoods, and enhance fiscal resilience. The operation also supports reforms to protect the country’s coastal and marine assets by supporting the sustainable use of natural resources.