WASHINGTON, CMC – 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 by stimulating micro, small, and medium-sized enterprises (MSMEs) in the country’s blue economy.
The Washington-based financial institution said this line of credit for the Local Sustainable Development in the Blue Economy Programme includes a first individual loan of 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 maximizing the value of ocean, marine, and coastal resources.”
According to IDB estimates, the blue economy currently accounts for approximately 21.5 percent of The Bahamas’ gross domestic product (GDP) and up to 50 percent if indirect impacts are included.
The IDB noted that it still has the potential to expand, especially in the Family Islands or the Out Islands, the 700 islands that make up The Bahamas, excluding New Providence Island, where the capital Nassau is located, and Grand Bahama Island.
“The Local Sustainable Development in the Blue Economy Programme will help Bahamian MSMEs thrive in the blue economy. It will facilitate sustainable tourism, expand research in agriculture and marine sciences, and strengthen marine protected areas in the Family Islands region,” said Claudia Stevenson, an IDB specialist at the Competitiveness, Technology, and Innovation Division.
The IDB said the Local Sustainable Development in the Blue Economy Programme will boost the productive capacity and potential of approximately 120 MSMEs in the Family Islands by providing financing and technical assistance.
It will also award 160 scholarships for science degrees and 120 scholarships for specialized training for tour guides. The operation will also build up public institutions such as the Bahamas Agriculture and Marine Science Institute and the Bahamas National Trust.
The program’s marine protection initiatives will benefit the population in general, particularly the approximately 25,000 inhabitants of the Andros and Abaco areas.
The program is structured around three components.
The first will promote growth among MSMEs operating in the blue economy, helping them become more extensive and more efficient by adopting innovations and technology and facilitating the expansion of sustainable tourism-related businesses.
The second component will develop specialized human capital for the blue economy in coordination with the Bahamas Agriculture and Marine Science Institute. This component will also foster the production of scientific knowledge and its incorporation into industry.
Finally, the third component will enhance the blue economy’s sustainability by financing the implementation and improvement of management plans for existing marine protected areas. This component also includes actions to raise community awareness, scale up coral and mangrove restoration, and collect data for marine species monitoring, among others.
The conditional credit line for investment projects consists of two individual and sequential loans over ten years. The first loan, US$30 million, has a 25-year repayment term, a 5.5-year grace period, and an interest rate based on the Secured Overnight Financing Rate (SOFR).
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