Financial institutions agree on Caribbean action plan

NASSAU, Bahamas: Five leading international financial institutions have reinforced their commitment to ensuring long-term economic growth across the region, resilience to the global financial crisis and effective deployment of assistance for reconstruction efforts in Haiti with agreement on a US$850 million Caribbean Joint Action Plan.

The institutions participating in the landmark agreement are the Caribbean Development Bank (US$300 million), the European Investment Bank (US$100 million), the Netherlands Development Finance Company FMO (US$100 million), the International Finance Corporation – part of the World Bank Group (US$150 million) and PROPARCO – the private sector arm of the Agence Française de Développement Group (US$200 million).

The signing ceremony took place last week at the annual meeting of the Caribbean Development Bank (CDB).

According to a statement from the CDB, the Caribbean Joint Action Plan will enable more effective use of financial and technical assistance by encouraging a stronger focus on each participating institution’s experience and capabilities.

“Joint investment under the plan will concentrate on crucial economic sectors most impacted by the economic slowdown: finance, tourism and infrastructure,” it said.

This approach is expected to further support economic growth in the region by mobilizing international financial institution investment to act as a catalyst for private sector engagement and facilitating national and sub-regional support and policy dialogue among both private and public stakeholders.

Desmond Brunton, CDB’s Vice-President, Operations, said the joint approach to helping the Caribbean countries address their challenges is “critical to the effective use of development assistance, especially in this period of uncertainty”.

Each of the five institutions will finance their own projects within the sector scope with co-financing opportunities being examined on a case-by-case basis.

Specific efforts will also be taken to foster public-private sector policy dialogue in the region, supporting governments’ macro-economic and structural reform and in coordination with International Monetary Fund, World Bank and Caribbean Development Bank programs.

The institutions involved expect to commit the US$850 million over a two to three year period, starting this year.

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