The Caribbean Development Bank (CDB) is set to unlock hundreds of millions of dollars in concessional funding over the next three years to bolster hurricane preparedness, disaster response, and climate adaptation in member countries, the bank has announced.
This significant financial commitment comes in the wake of Hurricane Beryl, which devastated the region in 2024 as the earliest recorded Category 5 storm.
The Barbados-based CDB has already secured over $87.5 million in climate financing for 2025, with expectations to unlock $750m in concessional funding over the next three years, as it steps up efforts to help member countries strengthen hurricane preparedness, disaster response, and climate adaptation.
While Barbados was spared the worst of the hurricane, damage to the fishing industry and coastal areas underscored the need for greater investment in resilience-building projects, according to the bank.
Speaking at its annual news conference, the CDB’s Division Chief for Economic Sustainability, Valerie Isaac, said the bank’s focus on climate resilience is more critical than ever.
“For our countries, CDB’s support is vital to enhance climate and disaster resilience. Resilience is not merely part of our work—it forms the foundation of everything we do,” she said.
Isaac noted that the bank has already approved over $70 million in climate finance for 2025 and is on track to secure more than $800 million in concessional funding for resilient transport, agriculture and food security, water, and energy over the medium term.
The bank is also accelerating post-disaster funding by rolling out two new disaster risk financing instruments—the Disaster Response Policy Operation and the Contingent Emergency Response Component—to give borrowing member countries faster access to funds after hurricanes, floods, and other extreme weather events.
“We expanded our disaster risk financing instruments to include a disaster response policy operation and a contingent emergency response component tool, both of which we launched last year,” Isaac said.
“These instruments reduce the financial burden on Borrowing Member Countries and provide quick access to funds after disasters, helping governments and communities respond more effectively.”
She also noted that the Caribbean Catastrophe Risk Insurance Facility (CCRIF) disbursed approximately $72 million to Grenada, Jamaica, and St Vincent and the Grenadines in the wake of Hurricane Beryl, with $5.6m allocated to social protection systems.
CDB has further secured approval from the Green Climate Fund to expand its project financing capacity to $250m per initiative—a fivefold increase that will allow for large-scale investments in energy security, food sustainability, and climate adaptation.
CDB’s Acting Director of Projects, O’Reilly Lewis, noted the bank’s commitment to major resilience-focused infrastructure projects, including $22 million for Saint Lucia’s John Compton Dam, ensuring water security for 33 000 households; $15m for coastal protection in Grenada, strengthening defences against storm surges and shoreline erosion; and $5m for Haiti’s first rural electrification project, providing over 2 000 new electricity connections to communities reliant on candles, kerosene, and charcoal.
The CDB-funded 10-megawatt geothermal power plant in Dominica, set to be operational in 2026, will lower electricity costs and enhance energy security, Lewis said.
The bank officials revealed that as Caribbean economies expected a 2.5 per cent growth rate in 2025, concerns over high debt levels and economic shocks remained.
Nearly half of CDB’s borrowing member countries have debt-to-GDP ratios exceeding 60 per cent, raising concerns about fiscal sustainability in the face of climate disasters.
CDB President Daniel Best stressed that faster, more effective financial support is critical to ensuring the region can recover quickly from climate-related shocks.
“Hurricane Beryl underscored the importance of this risk-pooling mechanism,” Best said.
“The region is seven times more likely to be impacted by a natural hazard than a larger country. We can no longer be surprised when these events happen. We must prepare, and we must finance that preparation properly.”
(SM)
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