NASSAU, BAHAMAS — The Inter-American Development Bank (IDB) has approved a US$200 million loan to promote competitiveness and environmental resiliency in The Bahamas.
This will be done by improving the business climate; supporting the micro, small and medium enterprises (MSMEs) continuity; modernizing the institutional and legal framework to protect the natural resources; and economic diversification by promoting scientific and institutional developments in the Blue Economy, according to a statement.
The IDB loan of US$200 million has a repayment term of 20 years, a grace period of five and a half years and an interest rate based on LIBOR – a global benchmark.
The program reportedly supports the mandate and vision of the Bahamas Economic Recovery Committee of providing for a resilient, dynamic, inclusive, and sustainable economy and promotes private sector-led growth under a stronger comprehensive environmental framework.
It is the first of two operations under the modality of Programmatic Policy-Based Loan (PBP), to be contractually independent and technically related.
The project seeks to improve and modernize the business climate by strengthening the transparency and governance of capital markets and facilitating the process of obtaining business licenses for low risk companies.
It also supports the continuity of MSMEs and the strengthening of their technical capacities in the short and medium term period.
At the same time, the program modernizes the legal and regulatory framework for environmental resiliency, with the creation of the Ministry of the Environment, new legislation for control of plastic pollution, environmental impact assessment, sustainable procurement practices and the promotion of scientific resources to develop the Blue Economy.
It also supports the governance and financial management of Marine Protected Areas, which is part of the ambitious strategic goal of the Bahamas to protect 20 percent of its marine and coastal environment by 2020.
The policy reforms of the program are a combination of initiatives that support both public and private sector entities, that strengthen the environment of doing business in a sustainable and resilient manner, while protecting the natural assets of the country.
In addition, different actors of the Blue Economy sector will benefit from the initiatives to promote its development; and the citizens of the country in general that will enjoy the benefits of the marine protected areas (better natural barriers for environmental resilience and more sustainable fishing) including positive externalities from the measures to control plastic pollution.