An IDB program to provide loans and grant financing to Jamaican private sector groups and community-based organizations for initiatives to reduce their risk to natural disasters and adapt to the impacts of climate change will be carried out with financing from the Pilot Program for Climate Resilience (PPCR).
Examples of initiatives that would be financed by the PPCR resources include activities related to water conservation, harvesting and management, land management, climate-smart agriculture and food security, climate proofing facilities and operations, and community based disaster risk reduction. . At present, funding is extremely limited in Jamaica to carry out such initiatives on a sustained basis.
The project. The Financing Mechanisms for Sustained Adaptation Initiatives by Private Sector and Community Based Organizations project will be managed by the IDB and financed with a US$6.4 million PPCR loan.
The project will establish a line of credit to provide loans to farmers and other agricultural sector businesses for climate change adaptation and disaster risk reduction initiatives. The aim of the initiatives is to improve the resilience of the agricultural sector, protect livelihoods, and increase incomes. Studies will be carried out to determine the nature and extent of demand for financing to ensure that the resources are utilized in a timely manner. The line of credit will be managed by the Development Bank of Jamaica and disbursed through its network of People’s Cooperative Banks.
In addition, the project will establish a trust fund to provide grant support for community-based organizations, other civil society groups, and selected public sector agencies to carry out adaptation and poverty-reduction and initiatives to protect livelihoods.
The fund will collaborate with existing agencies engaged in climate change adaptation at the national, regional, and community level to ensure efficiency and effectiveness. An independent but fully accountable board will be established to make investment decisions and determine the amount that will be available annually for project financing. The Board will be comprised of private and public sector members from the Ministry of Finance, the Planning Institute of Jamaica and the Ministry of Water, Land, Environment and Climate Change.
High-priority for adaptation measures. The investment project is being carried out as part of the Jamaican government’sStrategic Program for Climate Resilience (SPCR) to help climate-proof the country’s future development. The SPCR is aligned with Vision 2030 Jamaica, and also addresses gaps and challenges identified in Jamaica’s Second National Communication to the United Nations Framework Convention on Climate Change. The SPCR was developed with input from stakeholders at the national and local levels, and reflects priority areas identified through consultations.
The SPCR identifies lack of access to financing as a major barrier to disaster management and climate change adaptation initiatives for both private sector and community-based organizations. Public sector entities charged with responsibility to implement strategic adaptation and disaster risk reduction activities also lack access to the relatively modest sums required. Grant funding presently available through the Environmental Foundation of Jamaica, the Forest Conservation Fund, and the GEF Small Grants Facility is not sufficient to finance needed projects on a sustained basis.