Bahamas-Barbados, Policy Note, IDB
IDB has realized that governments’ capacity to efficiently plan, develop necessary financial incentives and access, as well as to absorb and coordinate international climate change mitigation financing is key to enhancing countries’ effectiveness in responding to climate change and promote sustainable energy. National development banks and other key players in domestic capital markets could play a critical role in promoting climate change mitigation financing and particularly energy efficiency programs.
To hold a policy dialog with the Barbados and Bahamas governments, IDB wished to prepare a note about the assessment of green financing in the production sector and offer viable and appropriate solutions to address the problems restricting sustainable growth in these countries.
Econoler performed an up-to-date analysis to provide inputs for the policy note being developed by several IDB departments.
In its report about each country, Econoler included:
- A summary of the existing challenges and opportunities in both energy efficiency (EE) and renewable energy (RE) sectors;
- A list of priorities in addressing the challenges faced by the country to manage and develop the sectors;
- A summary of the government strategy and work plan for the sectors;
- An analysis of the support other donors are providing to green financing or the perspectives of the support of the next administration;
- An update on current financing instruments available to support key activities aimed at the transition to a green economy, especially RE and EE projects in Bahamas and Barbados;
- A study of the possibilities and opportunities/ importance of structuring second-tier funding that could promote credit lines to finance RE and EE by local first-tier financial institutions;
- Estimation of the market potential and size of EE and RE investment programs.
- An analysis of experience with first-tier and second-tier funds and the capacity of local financial institutions (including MFI) to develop such schemes in Barbados and the Bahamas and the Caribbean in general;
- A proposed financial mechanism adapted to each country, including a description of the roles of different parties and sectors.
For Barbados, several interviews with local banks and other market stakeholders provided inputs to the analysis.
These two analyses were included into policy notes and will be transmitted by IDB to the two governments