Government is in the process of finalising arrangements for Barbados
to be a part of and have access to the Inter-American Development
Bank’s Contingent Credit Facility for Natural Disaster Emergencies.
That’s according to Minister in the Ministry of Economic Affairs and
Investment Marsha Caddle, who stated this facility is a rapidly
disbursing fund that was created recently to respond to natural
disasters. She said should disaster strike, the country would be able
to bypass all of the regular processes, and have immediate access to
liquidity. She spoke about that facility earlier this week during the
debate on the Catastrophe Fund Bill, as she defended Government’s
decision to include pandemics in the types of catastrophe covered
under the Fund.
“If ever there was something that was a catastrophe, it is the
COVID-19 pandemic and in fact, the international community has
responded and taken all of its similar instruments and expanding them
to include pandemics. So it is not only Barbados that is realising
that in fact things like COVID-19 are by definition unforeseen shocks
– they are disasters, they are catastrophes,” she maintained.
Referring to the facility from the Inter-American Development Bank
(IDB), she said that once Barbados signs on to it, it would provide
much-needed liquidity should the country face any disaster in the
future.
“The climate resilience issue, the disaster preparedness and
resilience issue is two-fold. We have to build in resilience
beforehand, but then we also have to make sure we have access to cash
after the fact. And so I do take the point of the Honourable Member
for St. Michael West that yes, the CCRIF [Caribbean Catastrophe Risk
Insurance Facility] was not enough, but the Contingent Credit Facility
for Natural Disaster has two modalities as it stands now, and is now
adding two further modalities,” she stated.
She explained that the first modality which covers earthquake,
hurricane and extreme flooding, allows a country to access US $300
million or 2 per cent of the country’s GDP, whichever is less. She
said based on agitation and advocacy from Barbados and the wider
region, the second mo-dality includes storms, tsunamis and droughts.
“But they want to [go] further; were it up to the IDB and others, they
would also want to include slow onset events, things like beach
erosion. They feel, again based on representation from us as
tourism-dependent economies, that even though this is not based on an
extreme weather event, it is one of those creeping impacts of climate
change and should be considered as a parametric trigger in instruments
such as this,” she stated.
Caddle told the Lower House that when COVID-19 started to affect the
region, the IDB, based on discussions with its members, added two
other modalities – one focused on COVID-19 itself, and the other on
health risks.
“More and more the world is realising that it is not just about
natural disasters – that there are so many ways in which the people
and the economy of a country can be exposed to an unforeseen shock
that was not in anyone’s control,” she added. (JRT)