The Inter-American Development Bank (IDB) has approved Compete Caribbean, a program to support private sector development and competitiveness in 15 Caribbean countries.
The program, known as Compete Caribbean, is a joint initiative of the IDB, the Canadian International Development Agency (CIDA), and the United Kingdom’s Department of International Development (DFID).
The program will be implemented in Antigua and Barbuda, The Bahamas, Barbados, Belize, Dominican Republic, Dominica, Grenada, Guyana, Haiti, Jamaica, St Lucia, St Kitts and Nevis, St Vincent and the Grenadines, Suriname, and Trinidad and Tobago.
Compete Caribbean will provide technical assistance and investment funding to a variety of activities aimed at establishing productive development policies, implementing business climate reforms, launching clustering initiatives, and promoting small and medium-sized enterprises (SMEs) throughout the region.
The program establishes a US$32.55 million grant facility to support private sector development and competitiveness in the Caribbean region. CIDA is contributing a CAN$20 million grant (around $18.70 million) and DFID is providing a £8.656 million grant (approx. $13.85 million).
The IDB will establish and manage a program coordinating unit in Barbados for the effective implementation of the program. The Bank will also provide the expertise to identify, design and implement the projects included in Compete Caribbean, working in close collaboration with regional institutions, governments and private sector entities.
The program is expected to contribute to an increase in non-traditional exports, from the average 2.2 percent of GDP in recent years to a 5 percent of GDP by 2017. It is also expected to create 8,000 new jobs, and make measurable advances in gender equality indicators. All 15 countries are expected to advance positions in the global rankings measuring competitiveness and business climate.
Caribbean economies were hit hard by the recent global recession, given the inherent constraints of their size and their limited diversification. Tourism dropped, demand for Caribbean exports fell, and foreign direct investment decreased, bringing a reduction in income that significantly affected the countries’ GDP and national reserves.
“As Caribbean countries grapple with the effects of the global downturn the greatest structural challenge confronting their economies is defining new areas of competitive advantage. We hope that Compete Caribbean will help the region overcome some of its constraints to growth, and thus help increase productivity, exports, and employment in strategic sectors”, said IDB project team leader José Jorge Saavedra.