BRAZIL – At COP30 in Belém, the Inter-American Development Bank (IDB), CAF – Development Bank of Latin America and the Caribbean – and the Caribbean Development Bank (CDB) announced the Caribbean Multi-Guarantor Debt-for-Resilience Joint Initiative.
The Inter-American Development Bank (IDB), CAF – Development Bank of Latin America and the Caribbean, and the Caribbean Development Bank (CDB) launched Thursday at COP30 the Caribbean Multi-Guarantor Debt-for-Resilience Joint Initiative, a landmark regional effort designed to boost disaster preparedness while easing debt pressures across the Caribbean.
By leveraging guarantees from MDBs and private sector actors, the initiative will create fiscal space for countries to invest in priority resilience measures and regional public goods, enabling action before disasters strike and without adding new debt.
The Joint Initiative will focus on three goals:
- Scale up debt-for-resilience swaps to generate fiscal space for enhanced resilience.
- Strengthen coordination among MDBs, governments, and private sector partners to scale and streamline interventions, particularly debt-for-resilience swaps in the region.
- Improve transparency, monitoring, and evaluation standards to attract more investment.
The Joint Initiative intends to create a facility under a Framework Agreement designed to facilitate coordination among guarantors for debt-for-resilience swap transactions, while respecting each institution’s mandates, internal approvals, and formalisation processes. Debt-for-Resilience transactions will be tailored to align with national development and sovereign debt management strategies, in accordance with each guarantor’s policies.
The institutions will work together to establish common principles for guarantee terms, define shared taxonomies and key performance indicators (KPIs) for resilience investments, aligned with global benchmarks.
This initiative is expected to streamline multi-guarantor debt swaps, attracting new and non-traditional guarantors, enabling larger transactions, lowering costs, and accelerating execution, while enhancing access to investors through robust reporting and monitoring frameworks. Each debt swap transaction should include a regional public-goods component, reinforcing collective resilience across the Caribbean.
