Blue loan for Bahamas
THE INTER-AMERICAN Development Bank, IDB, says it has approved a US$60-million conditional credit line for investment projects to foster sustainable development in The Bahamas targeted at stimulating MSMEs, or micro, small and medium-sized enterprises, in the country’s blue economy.
The first loan to be issued under the line of credit for the Local Sustainable Development in the Blue Economy Programme amounts to US$30 million.
“The Bahamas’ geography and climate give it enormous potential in the blue economy, which is an approach that yolks together economic growth, environmental sustainability and healthy marine ecosystems by maximising the value of ocean, marine and coastal resources,” said the Washington-based development bank that finances countries of the Caribbean and Latin American region.
According to IDB estimates, the blue economy currently accounts for approximately 21.5 per cent of The Bahamas economy, and up to 50 per cent if indirect impacts are included.
But it still has potential to expand, especially in the ‘family islands or the ‘out islands’, that is, the 700 islands that make up The Bahamas. They exclude New Providence Island, where the capital, Nassau, is located, and Grand Bahama Island, the IDB noted.
Claudia Stevenson, an IDB specialist at the Competitiveness, Technology, and I nnovation Division, said the blue economy programme would “facilitate sustainable tourism, expand research in agriculture and marine sciences, and strengthen marine protected areas in the family islands region”.
The programme is targeted at around 120 MSMEs, which will receive both financing and technical assistance; aims to award 160 scholarships for science degrees and 120 scholarships for specialised training for tour guides; and support public institutions such as the Bahamas Agriculture and Marine Science Institute and the Bahamas National Trust.
The programme is structured around three components: promoting growth among MSMEs operating in the blue economy, through adoption of innovations and technology; developing specialised human capital and scientific knowledge, in coordination with Bahamas Agriculture and Marine Science Institute; and financing management plans for existing marine protected areas. The latter component also includes actions to raise community awareness, scale up coral and mangrove restoration, and collect data for marine species monitoring.
The conditional credit line for investment projects consists of two individual and sequential loans over the course of 10 years. The first loan of US$30 million has a 25-year repayment term, a 5.5-year grace period, with interest based on the IDB’s Secured Overnight Financing Rate, or SOFR, which currently ranges between 5.33 per cent and 5.39 per cent.