Building Back Better: Green Finance for The Caribbean

The Caribbean was hit hard by the Covid-19 pandemic, with economies heavily reliant on tourism and commodity exports suffering acute rises in poverty and inequality. The region is also among the most exposed to climate change and natural disasters - losing an estimated 3% of annual GDP to climate-related events over the past two decades. The recovery from these twin shocks is an opportunity to build back better, channelling investment towards a low-carbon, climate-resilient future. MSMEs, as the backbone of Caribbean economies, have a central role to play in shifting towards more sustainable production and consumption. 

Objectives

Scaling up green finance to drive the Caribbean's sustainable recovery 

The project works to expand the market for green finance across the Caribbean, helping the region's economies transition to a more sustainable model aligned with the Global Gateway Investment Agenda for Latin America and the Caribbean. It supports small-scale climate action and environmental sustainability investments, channelled primarily through MSMEs and intermediated by public sector banks, acceptable bodies and microfinance institutions. 

Project activities

The project has two main components: 

• MSME-relevant green investments across a range of areas, including energy efficiency, integrated renewable energy solutions - such as solar control films, cool roofs, rooftop solar photovoltaic installations, LED lighting retrofits in commercial buildings, hotels and tourist establishments, and wind and solar power - as well as activities to turn Sargassum algae into an economic opportunity, and other projects contributing to greenhouse gas emissions reduction and environmental sustainability
• Technical assistance, financed by LACIF, to support five Caribbean financial institutions in adopting green and sustainable practices and creating demand for green finance through awareness-raising among final beneficiaries 

(Expected) Results

The project contributes to: 

• Green investment by MSMEs in priority sectors, with equal access for women and socially excluded entrepreneurs
• Greater awareness of the economic benefits of green investment
• Improved capacity of MSMEs to present green investment proposals
• Employment creation, particularly for women, socially excluded individuals and communities affected by climate change, driving greater financial inclusion and expanded leadership opportunities 

Implementing partners

European Investment Bank (EIB)