US$80 million to reduce vulnerability and greenhouse gas emissions
The Inter-American Development Bank (IDB) approved a US$80 million loan to help Trinidad and Tobago incorporate the consideration of the impact of climate change into national policies and institutions.
“The program will strengthen and modernize the regulatory, institutional and policy framework to develop and promote instruments to assess and reduce vulnerability and risks associated with climate change,” said IDB team leader Gerard Alleng. “Mitigation and adaptation measures will be key in an island state highly vulnerable to the impact of global climate change.”
The impacts from climate change in this and other Caribbean states are expected to stem from rising temperatures, reduced precipitation and sea level rise. For Trinidad and Tobago, these conditions will affect the biophysical and socio-economic situation in areas such as agriculture, human health and settlements, coastal zones and water resources.
“This initiative will also promote carbon markets and policies to reduce greenhouse gas emissions,” added Claudia Perazza, the other IDB team leader. “This financing is the first of a program of two policy-based loans to support the Government of Trinidad and Tobago design and implement a reform process to follow a low-carbon development path.”
As an oil and gas producer, the government of Trinidad and Tobago recognizes the potential to engage in significant greenhouse gas emissions reductions as part of its response to climate change. The government identified the financial requirements to adequately address these climate change issues and the importance of developing the policy framework to transition to a low carbon development path. Special focus will be placed on improving the country's ability to adapt to climate change and to strengthening the institutions responsible for the management of climate change related issues.
The loan is for a 20-year term, with a four-year grace period, at a variable interest rate based on LIBOR. The Ministry of Finance will be in charge of the project.