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CDB offers support

The Caribbean Development Bank is mobilising funds to help its Borrowing Member Countries, including The Bahamas, through the expected economic downturn generated by the Coronavirus outbreak. 

Wednesday, March 25, 2020
Wednesday, March 25, 2020

The Caribbean Development Bank (CDB) is mobilising funds to help Borrowing Member Countries (BMCs), including The Bahamas, through the expected economic downturn generated by the Coronavirus outbreak.

“The CDB stands ready to provide support to its BMCs as they weather the COVID-19 storm, and for us to be a partner in the post-crisis period,” said CDB President Dr William Warren Smith who added that the Bank would seek commitments from its partners to help the region access much-needed financial relief.

“We recognise that, given the magnitude of the crisis that we face, the level of support needed cannot be the remit of any single agency. This is a global crisis and, as such, it requires a global response with strong partnerships,” he said. “The CDB is willing to play the role of coordinator of resources, mobilised on behalf of the region. We can leverage our longstanding relationships with bilateral and mulitlateral development partners and we have already begun that engagement and we are very optimistic about the support that we have.”

The Bank currently has access to $90 million worth of resources and is repurposing those loans to target the most vulnerable island nations following engagement with BMCs to see where the need is greatest. “It needs to be coordinated so we can get the best bang for our buck,” said Dr Smith.

The Bank can also issue External Shock Response Policy Based Loans, typically used in the aftermath of natural disasters.

CDB economists are projecting a severe decline in some islands as the pandemic takes hold, suggesting that nations with high debt such as Barbados could see their GDP fall by as much as 20 per cent.

“For our region as a whole, the impact of COVID-19 is expected to be much more profound than it is in other parts of the world,” said Dr Smith. “The likely scenario for 2020 is a sharp contraction in economic activity. Those countries that don’t have fiscal buffers are going to find themselves in an especially difficult position.”

The Caribbean Hotel and Tourism Association is hopeful that the region's tourism industry will rebound and "emerge stronger" once the current Coronavirus pandemic has passed, citing the sector's resilience to economic shocks.

The Ministry of Finance has advised that the deadline for economic substance filing is extended by three months for all entities reporting for fiscal year 2019. Read the public notice here.

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