BRIDGETOWN, Barbados, Tuesday December 17, 2019 – The Bahamas is in line for US$50 million to help it recover from the devastating Hurricane Dorian which left Grand Bahama and Abaco in shambles when it hit at the beginning of September.
The Board of Directors of the Barbados-based Caribbean Development Bank (CDB) said today that it has approved an Exogenous Shock Response Policy-Based Loan of US$50 million.
“The loss of life and massive destruction caused by Hurricane Dorian has placed a heavy burden on The Bahamas. The loan will support the people and the country during the recovery and maintain the momentum of the ongoing reform programme to foster fiscal discipline and build resilience against natural disasters,” said CDB President Dr Warren Smith.
As at October 2019, there were 67 confirmed deaths and 282 people still missing. Some 29,500 inhabitants, equivalent to over 40 per cent of the combined population of Abaco and Grand Bahama, suffered severe damage to homes and assets.
According to the United Nations, the total value of the damage and loss is equivalent to 25 per cent of gross domestic product (GDP), which exceeds by far the damage and loss – equivalent to 4.9 per cent – incurred from Hurricane Mathew in 2016.
The Exogenous Shock Response Policy-Based Loan is an instrument to provide resources for financing needs that arise from external and natural hazards shocks that have a significant economic and social impact.
In addition to providing finance for the ongoing recovery, the loan will support the implementation of the comprehensive reform programme of The Bahamas that aims to achieve fiscal sustainability and enhance economic and physical resilience to external shocks and natural disasters, while bolstering growth and job creation.
CDB Staff have estimated the impact of Hurricane Dorian on economic growth in The Bahamas over the short and medium term. Economic growth has been revised downwards from 1.7 per cent to one per cent in 2019 and from 1.8 per cent to 1.5 per cent in 2020. This translates to a total impact on GDP of one percentage point. Economic growth is expected to return to its long-term average of approximately 1.8 per cent by 2021.