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European Union

EU and Barbados Announce Groundbreaking Debt for Climate Swap to Upgrade Water Infrastructure

Strategic Insights

— 2 min read

The European Commission and the European Investment Bank have joined forces with the Inter-American Development Bank and the Government of Barbados to launch a novel debt-for-climate swap, aiming to upgrade Barbados' climate-resilient infrastructure for clean water. This initiative aligns with the Global Gateway investment agenda, a commitment made at the EU-CELAC Summit in July to deliver digital, green, and fair transitions with Caribbean partners. The partnership will provide approximately €276 million in funding for the upgrade of the Barbados South Coast Sewage Treatment Plant, a multi-faceted project that will increase water supplies, mitigate climate change impacts, and generate employment opportunities.

Key Takeaways:

  • The EU and Barbados announced a debt-for-climate swap to upgrade the Barbados South Coast Sewage Treatment Plant, valued at approximately €100 million.
  • The partnership involves the European Commission, the European Investment Bank, the Inter-American Development Bank, and the Government of Barbados.
  • The debt swap will provide €276 million in funding, of which €140 million will come from the European Investment Bank and €120 million from the Inter-American Development Bank, backed by a €280 million guarantee.
  • The project is aligned with the Global Gateway investment agenda, a commitment made at the EU-CELAC Summit in July to deliver digital, green, and fair transitions with Caribbean partners.
  • The initiative aims to enhance climate resilience, reduce water shortages, and improve wastewater systems in Barbados.
  • The project will generate employment opportunities for the local population and contribute to the reduction of environmental impact on marine life and the local ecosystem.

Statistics:

  • €276 million: The approximate amount of funding provided through the debt-for-climate swap.
  • €100 million: The total estimated cost of upgrading the Barbados South Coast Sewage Treatment Plant.
  • €140 million: The total amount provided by the European Investment Bank as a guarantee.
  • €150 million: The total amount provided by the Inter-American Development Bank as a guarantee.
  • €280 million: The total amount of the guarantee for the debt swap.
  • 17th July 2023: The date the EU-LAC Global Gateway Investment Agenda was presented at the EU-CELAC Summit in Brussels.

Sources:

  • European Commission: "Commissioner for International Partnerships, Jutta Urpilainen, announces EU support to upgrade Barbados' climate-resilient infrastructure for clean water" (Press corner detail, 10 November 2023)
  • European Investment Bank: "The European Investment Bank and the Inter-American Development Bank provide funding to boost climate resilience in the Caribbean" (EIB News release, 10 November 2023)
  • European Union - Latin America and the Caribbean Global Gateway Investment Agenda (GGIA) (Presented to the EU-CELAC Summit in Brussels, 17th July 2023)

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