In a move to combat the rising costs associated with supercharged hurricanes, Prime Minister Philip “Brave” Davis announced yesterday a new financing facility, The Bahamas Sustainable Investment Programme, to help tackle the fight against climate change.
“We are going to survive an era of supercharged storms by creating supercharged win-win investment partnerships,” said Davis at the Clinton Global Initiative in New York.
“With our strategic advisors, Resilience Capital Ventures, we will work with regional and global capital market leaders to underwrite and place an innovative financing facility with a target of $500 million.
“Our priorities include climate-resilient infrastructure, our clean energy transition, coastal zone conservation, reducing biodiversity loss, regenerative agriculture, carbon sequestration, and participation in natural asset-backed carbon credit programs.
“Blended finance is a smart way to close the climate financing gap at a time when solutions cannot be postponed.”
Davis has emerged as a leading voice on climate change and the need for action.
“We’re working with other small island nations to fight for emissions reductions,” he said.
“We’re strengthening our ability to respond to hurricanes, and we’ve launched a National Youth Guard, so that young Bahamians can work alongside our disaster response teams and our national security forces.
“A cruel irony is that those four massive hurricanes cost us billions, leaving us without the fiscal space we need to get ready for the next storms.
“Topping the lists of countries most vulnerable to climate change makes borrowing more expensive. Every single day, we are paying for the hurricanes we’ve already suffered and the ones still ahead of us.
“In addition, our nation’s middle-income designation leaves us unable to access fair and concessional financing for recovery and adaptation. This traps us in a cycle in which the servicing of our debt leaves very little to invest in building our resilience.
“We urgently need new and creative solutions to our climate financing.
”The Bahamas Sustainable Investment Programme is a “multi-year investment and economic development program that seeks to position The Bahamas at the forefront of sustainable investment trends and deliver socioeconomic benefits to the people of the country”.
The program, designed by Resilience Capital Ventures, utilizes three components: The Bahamas Sustainable Investment Strategy, The Bahamas Sustainable Investment Facility, and The Bahamas Sustainable Investment Infrastructure.
“The strategy component will include a communication and engagement effort that develops and shares thematic messages to various audiences identifying and engaging specialists in these activities,” Resilience Capital Ventures said.
The financing component focuses on financing with a blended architecture “taking stakeholder engagement, including with policy and legislative authorities, as core to execution”.
The infrastructure component “involves the design of an inward investment institutional framework that improves the effectiveness of investment attraction, screening and selection”.
Resilience Capital Ventures said the financial investment to deliver the entire program over five years is estimated at $25 million.
“To achieve the envisaged outcomes, the government of The Bahamas is inviting financial contributions to meet this budgetary commitment from foundations, development partners, development finance institutions, and private sector investors including impact investors and foundations,” it said.
“The [Bahamas Sustainable Investment Programme] will draw on multiple sources and types of financing while maintaining ownership for the strategic direction of the program.
“A unique feature of the program is the blended finance strategy that foregrounds a capital markets approach to financing and funding sustainable development.“This is intended to be a smart partnership between a sovereign and a number of commercial and development partners.”