Dominica is a Small Island Developing State (SIDS) which is particularly vulnerable to adverse climatic conditions, as well as to social, economic and environmental shocks. While its traditional economy is based on banana exports, recent changes in the market have led to the development of service sectors, including tourism, offshore medical schools and offshore finance. However, the lack of infrastructures, including the absence of a large international airport, limits the potential of those sectors.
The impact of the recent hurricanes in the Dominica is a clear evidence of the extreme vulnerability of Caribbean small islands states to Climate Change and its consequences. This climate vulnerability exacerbates the already high and inter-linked social, economic and environmental vulnerabilities of the country.
The economy of Dominica relies heavily on agriculture, tourism and investment for development and hence is inherently susceptible to external factors.
The main objective of the development cooperation with Dominica under is to support the Government in its efforts to recover from the effects of the global economic and financial crisis, restore macro-economic stability, and meet the Millennium Development Goals. Following the impact of hurricanes Erika and Maria, recovery and resilience building has been at the core of EU interventions in the country. Linkages between the national and the Forum of the Caribbean Group of African, Caribbean and Pacific ACP States (CARIFORUM) regional programmes will be sought, as will the opportunity to leverage further funds for development interventions; one opportunity for this being the Caribbean Investment Facility (CIF). EU support complements, and is based on, the analysis and projections of the Medium-Term Growth and Social Protection Strategy (GSPS) for 2012-18.
As a small Caribbean island nation with no proven reserves of conventional energy, Dominica is heavily dependent on imported petroleum products for electricity generation, transportation, cooking, and other energy requirements. Under the 11th European Development Fund (EDF) National Indicative Programme (NIP), efforts will focus on supporting the energy sector goals of the government. Tapping the potential of geothermal power production is currently being pursued with EU and French funding channelled through the CIF.
Following the impact of Tropical Strom Erika in August 2015, an additional allocation of €8.9 million was implemented under the 11th EDF. The funds assisted the government with re-establishing the provision of basic services.
Under the 11th EDF, the overall objective of the current programming period (2014-2020) is to support theenergy sector goals of the Government, as reinforced in the Growth and Social Protection Strategy (GSPS). An initiatial allocation of €4 million aims to:
- pursue a reduced-cost energy generation and supply for the benefit of the consumer
- encourage energy conservation
- diversify energy sources and reduce the reliance on fossil fuels
The specific objectives are:
- to contribute to the development of renewable energy, energy efficiency and conservation
- to contribute to technical and institutional capacity building and strengthening on renewable energies and their environmentally sustainable management
- to undertake additional research and analysis to facilitate the development of renewable energies
As a member of the Caribbean Community (CARICOM) and CARIFORUM, Dominica benefits from regional programmes funded under the Caribbean Regional Indicative Programmes. Dominica is also a signatory of the CARIFORUM-EU Economic Partnership Agreement (EPA), a comprehensive free trade agreement with a strong focus on development cooperation.