Three Caribbean Com­mu­ni­ty (CARI­COM) coun­tries are to ben­e­fit from as­sis­tance from the World Bank for dis­as­ter risk man­age­ment projects.

The Wash­ing­ton-based fi­nan­cial in­sti­tu­tion said that the US$70 mil­lion Dis­as­ter Risk Man­age­ment De­vel­op­ment Pol­i­cy Fi­nanc­ing project will as­sist St. Lu­cia, Bar­ba­dos and St. Vin­cent and the Grenadines.

Ac­cord­ing to the World Bank, the US$20 mil­lion project for St. Lu­cia will help the coun­try quick­ly ac­cess fi­nan­cial re­sources in case of an emer­gency, so it can re­spond faster and sup­port its peo­ple.

“The high costs of re­cov­ery and re­con­struc­tion fol­low­ing a nat­ur­al dis­as­ter strains pub­lic fi­nances, con­tributes to in­creased debt and lim­its coun­tries’ abil­i­ty to in­vest in de­vel­op­ment and high­er liv­ing stan­dards,” said Lil­ia Bu­run­ci­uc, World Bank Di­vi­sion Di­rec­tor for the Caribbean.

“This project helps St. Lu­cia ad­dress these chal­lenges by ad­vanc­ing key re­forms and pro­vid­ing rapid ac­cess to fi­nanc­ing in the event of a dis­as­ter. It al­so re­duces the need for cost­ly emer­gency bor­row­ing and en­ables faster, more fis­cal­ly re­spon­si­ble re­cov­ery, ben­e­fit­ing all St Lu­cians,”  she added.

The project will en­hance St. Lu­cia’s ca­pac­i­ty to pre­pare for and re­spond to nat­ur­al haz­ards and health-re­lat­ed crises. It in­cludes a Cat­a­stro­phe De­ferred Draw­down Op­tion (Cat DDO) – an in­no­v­a­tive World Bank fi­nanc­ing in­stru­ment – that will pro­vide a fast-ac­cess line of cred­it to sup­port a time­ly and ef­fec­tive re­sponse once an emer­gency is de­clared.

“This mile­stone comes as St.Lu­cia con­tin­ues to con­front grow­ing risks. Lo­cat­ed in the hur­ri­cane belt, the is­land is in­creas­ing­ly vul­ner­a­ble to ex­treme weath­er events, in­clud­ing hur­ri­canes, floods, land­slides, and droughts—many of which are in­ten­si­fy­ing,”  the World  Bank said.

It not­ed the es­ti­mat­ed an­nu­al loss­es from hur­ri­canes alone amount to near­ly US$9.5 mil­lion in dam­age to the is­land’s build­ing stock, rep­re­sent­ing ap­prox­i­mate­ly 0.4 per cent of its 2023 gross do­mes­tic prod­uct (GDP).

“With near­ly half of the pop­u­la­tion in St. Lu­cia liv­ing with­in five kilo­me­tres of the coast­line, the risk to peo­ple and prop­er­ty is ris­ing. These haz­ards not on­ly strain gov­ern­ment fi­nances but al­so jeop­ar­dize key eco­nom­ic sec­tors such as tourism and agri­cul­ture, while dis­pro­por­tion­ate­ly af­fect­ing the most vul­ner­a­ble.”

The World Bank said that in re­sponse to these es­ca­lat­ing risks, the Cat DDO of­fers St. Lu­cia im­me­di­ate liq­uid­i­ty in times of dis­as­ter. It said to ac­cess this con­tin­gent line of cred­it, St. Lu­cia has com­plet­ed a tar­get­ed set of pol­i­cy re­forms struc­tured around two main pil­lars: strength­en­ing phys­i­cal and da­ta in­fra­struc­ture for cli­mate and dis­as­ter risk man­age­ment, and im­prov­ing the coun­try’s fi­nan­cial readi­ness to re­spond to fu­ture shocks.

As part of the first pil­lar, the gov­ern­ment took steps to up­date and im­ple­ment phys­i­cal plan­ning reg­u­la­tions that pro­mote safer land de­vel­op­ment and will en­sure that new in­fra­struc­ture and ur­ban ex­pan­sion are guid­ed by risk-in­formed stan­dards.

The sec­ond pil­lar fo­cus­es on in­creas­ing St. Lu­cia’s fis­cal re­silience.

The gov­ern­ment has adopt­ed Pub­lic As­set Man­age­ment reg­u­la­tions to pub­lic in­ven­to­ry to eval­u­ate and mon­i­tor the con­di­tion and vul­ner­a­bil­i­ty of pub­lic in­fra­struc­ture. At the same time, a new Dis­as­ter Risk Fi­nanc­ing Strat­e­gy was adopt­ed, out­lin­ing fi­nan­cial in­stru­ments and poli­cies that can be used to bet­ter man­age the eco­nom­ic fall­out of dis­as­ters.

The World Bank said that these re­forms will com­ple­ment na­tion­al ef­forts al­ready un­der­way to strength­en re­silience through bet­ter plan­ning, reg­u­la­tion, and fi­nan­cial pre­pared­ness.

St.  Lu­cia joins oth­er Caribbean na­tions that are us­ing Cat DDOs to build fi­nan­cial buffers and in­sti­tu­tion­al ca­pac­i­ty to han­dle in­creas­ing dis­as­ter risk, in­clud­ing St. Vin­cent and the Grenadines, Grena­da, Ja­maica, Do­mini­ca, and Bar­ba­dos.

In the case of Bar­ba­dos, the US$30 mil­lion Dis­as­ter Risk Man­age­ment De­vel­op­ment Pol­i­cy Loan will help Bar­ba­dos build stronger sys­tems to man­age nat­ur­al dis­as­ters and health emer­gen­cies.

The Wash­ing­ton-based fi­nan­cial in­sti­tu­tion said that this project ar­rives at a crit­i­cal time for Bar­ba­dos, not­ing that de­spite its strong eco­nom­ic re­cov­ery, the coun­try re­mains high­ly vul­ner­a­ble to nat­ur­al haz­ards.

In 2024, Hur­ri­cane Beryl passed with­in 150 kilo­me­ters of the is­land, caus­ing dam­age es­ti­mat­ed at 1.4 per cent of GDP and se­vere­ly af­fect­ing the fish­eries and tourism sec­tors. Ris­ing sea lev­els and stronger hur­ri­canes are pre­dict­ed to in­ten­si­fy risks in the years ahead. Pub­lic health emer­gen­cies, such as the COVID-19 pan­dem­ic, have al­so shown the im­por­tance of hav­ing re­li­able, flex­i­ble fund­ing to re­spond rapid­ly and pro­tect es­sen­tial ser­vices.

“Bar­ba­dos, like many small states, is work­ing to build re­silience amidst se­vere and grow­ing shocks. The Cat­a­stro­phe Draw­down Op­tion will strength­en the coun­try’s abil­i­ty to re­spond swift­ly when dis­as­ters strike and pro­tect its peo­ple and com­mu­ni­ties,” said Bu­run­ci­uc.

The ini­tia­tive com­ple­ments the re­cent­ly ap­proved Bar­ba­dos Beryl Emer­gency Re­sponse and Re­cov­ery Project, that sup­ports the re­ha­bil­i­ta­tion of the fish­eries sec­tor, Bridgetown Port, and crit­i­cal in­fra­struc­ture dam­aged by Hur­ri­cane Beryl. To­geth­er, these op­er­a­tions form an in­te­grat­ed ap­proach to re­silience and dis­as­ter pre­pared­ness in Bar­ba­dos.

The World  Bank’s as­sis­tance to St. Vin­cent and the Grenadines amounts toUS$20 mil­lion sup­port­ing com­pre­hen­sive pol­i­cy re­forms to en­hance na­tion­al pre­pared­ness and re­silience. It in­cludes the Cat DDO  and builds on pre­vi­ous ini­tia­tives, in­clud­ing the Sec­ond Fis­cal Re­form and Re­silience De­vel­op­ment Pol­i­cy Cred­it with a Cat DDO, which pro­vid­ed crit­i­cal fi­nanc­ing in the af­ter­math of the La Soufrière vol­canic erup­tion in 2021.

The bank said that while St. Vin­cent and the Grenadines has made im­por­tant progress in re­cent years, sig­nif­i­cant vul­ner­a­bil­i­ties re­main.

“More fre­quent and in­tense storms, shift­ing rain­fall pat­terns, and wors­en­ing coastal ero­sion are plac­ing grow­ing strain on in­fra­struc­ture, ecosys­tems, and liveli­hoods. Pro­longed droughts are af­fect­ing wa­ter se­cu­ri­ty and agri­cul­ture, and the com­bi­na­tion of steep ter­rain and un­reg­u­lat­ed de­vel­op­ment in­creas­es the like­li­hood of land­slides and flash flood­ing.

“These com­pound­ing pres­sures threat­en pub­lic safe­ty, dis­rupt es­sen­tial ser­vices, and re­veal gaps in dis­as­ter pre­pared­ness and long-term plan­ning. This was al­so demon­strat­ed by the im­pact of Hur­ri­cane Beryl, the most pow­er­ful hur­ri­cane to im­pact the coun­try since 1875, which made a land­fall on Ju­ly 1, 2024, caus­ing es­ti­mat­ed eco­nom­ic dam­age of US$230.6 mil­lion, 22 per cent of its 2023 GDP.”

“This pro­gramme re­flects St. Vin­cent and the Grenadines’ strong com­mit­ment to proac­tive dis­as­ter risk man­age­ment and re­silience build­ing,” said Bu­run­ci­uc.

“By com­bin­ing time­ly fi­nanc­ing with strate­gic pol­i­cy re­forms, the Cat­a­stro­phe Draw­down Op­tion is help­ing the coun­try bet­ter pro­tect its peo­ple, econ­o­my, and fu­ture from the grow­ing threat of nat­ur­al haz­ards,”  she added.

The projects are fi­nanced by the In­ter­na­tion­al De­vel­op­ment As­so­ci­a­tion, the arm of the World Bank Group which sup­ports low-in­come coun­tries and small is­land economies. IDA’s grants and low-in­ter­est fi­nanc­ing help coun­tries in­vest in their fu­tures, im­prove lives, and cre­ate safer, more pros­per­ous com­mu­ni­ties around the world.

Tech­ni­cal as­sis­tance was pro­vid­ed for the pol­i­cy re­forms with fi­nan­cial sup­port from the Eu­ro­pean Union through the EU Re­silient Caribbean Pro­gramme and the Cana­da-Caribbean Re­silience Fa­cil­i­ty, both man­aged by the Glob­al Fa­cil­i­ty for Dis­as­ter Re­duc­tion and Re­cov­ery and the Caribbean: Strength­en­ing Fis­cal Risk Man­age­ment Trust Fund.

Con­tribut­ing coun­tries in­clude the Unit­ed King­dom, Ger­many, France, Japan, Cana­da, Nether­lands, Eu­ro­pean Com­mis­sion, Nor­way, Aus­tralia and the Unit­ed States.

WASH­ING­TON, Apr 11, CMC –

CM/ag/ir/2025