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Barbados to improve water resources management, agricultural health and food safety standards with new IDB loans for US$70 million

The Inter-American Development Bank approved two loans for a total of US$70 million for Barbados. The first loan seeks to improve the management and sustainability of its water resources, and the second loan aims to strengthen its agricultural health and food safety standards.

Both operations are expected to benefit the local population and the island’s crucial tourism industry.

The IDB recently confirmed its strong support to the Government of Barbados with the announcement of a new Country Strategy for 2009-2013.

The first US$50 million loan will support the Barbados Water Authority's drive to modernize its infrastructure and make its operations more efficient

IDB financing will support the BWA’s efforts to improve its infrastructure, operational efficiency and modernize its institutional framework.

Barbados ranks among the top 15 countries in the world in terms of water scarcity, with current groundwater extraction levels exceeding sustainable yields. As a result, further development, including a proliferation of requests for tourist developments, is constrained by the unavailability of fresh water.

The IDB loan will help modernize BWA’s organizational structure and boost its efficiency through the implementation of a Corporate Business Plan and upgraded billing and collection systems.

The installation of 50,000 new meters and network infrastructure improvements are expected to reduce unaccounted for water–the difference between total water produced and water billed–by at least 10 percentage points, which will in turn help strengthen BWA's financial position.

Also, water turbidity and disinfection rates will be substantially improved, while water pressure will be increased to ensure service continuity.

The problem of wastewater discharge–which affects both public health and the condition of beaches and coral reefswill be tackled through a wastewater treatment action plan, which will enable Barbados to reuse treated water.

As a result of all these measures, the BWA expects to see a 75 percent increase in customer satisfaction, defined as those qualifying the service as good or very good, by the end of the five-year program.

The Bank's loan is for a 25-year term, with a five-year grace period, and carries a variable interest rate based on LIBOR. The Government of Barbados will provide US$3 million in local counterpart funds.

A second US$20 million loan will help raise agricultural health and food safety standards to international levels

This program will help improve public health and increase the quality of local and imported food products by raising agricultural health and food safety standards to international levels. The program will benefit the population as a whole and the tourism industry in particular.

To achieve this goal, the program will support the establishment of the National Agricultural Health and Food Control System (NAHFCS) and the National Agricultural Health and Food Control Agency (NAHFCA).

The program will also underwrite improvements of laboratory infrastructure and surveillance and quarantine facilities, particularly at points of entry to the island, given that Barbados imports most of its food.

Most of the funds will be used to finance the upgrading of inspection and quarantine facilities at entry points and construction of at least two laboratories. The Bridgetown Port Authority surveillance facility will be relocated, expanded, and upgraded to enhance its plant and animal surveillance and quarantine capabilities. The Grantley Adams International Airport surveillance area will be expanded and fitted with equipment and secure space for examination and quarantine activities.

New Plant Pathology and Entomology labs will be built and equipped at a Ministry of Agriculture site, and additional staff will be hired and trained in order to obtain international standard laboratory processes accreditation. 

This IDB loan is for a 25-year term, including a four-year grace period, at a LIBOR-based variable interest rate. The government will provide US$8 million in local counterpart funds.

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