1. IFC in the Caribbean
Presentation on Small States December 11, 2008

2. Caribbean Profile – Region of Diversity
13 countries
o/w 5 IDA and 8 non-IDA, 8 small states
11 island economies
30% living under $2/day
High unemployment
Anemic growth since early 1990s
OECS –
IFC Members
Antigua and Barbuda
Bahamas
Barbados
Dominica
Grenada
St. Kitts & Nevis
St. Lucia

3. Development Challenges of the Caribbean
Public
Private
High unemployment, poverty and inequality
Rising crime
High HIV/AIDS incidence
Gap in education, skills and productivity
Brain drain
Labor cost is high relative to skills
High levels of public debt:
7 out of 10 (14 out of 30) most indebted countries in world;
Average debt rose from 67% of GDP (1997) to 96% (2003)
high tax rates
Small and fragmented market sizes
Economies vulnerable to disasters and external shocks
Lagging growth and investments, especially FDIs
Non-uniform regulatory climate
Increasing competition in tourism market
Few indigenous successes and little linkages to local economy
Infrastructure constraints
Inefficient Ports and Customs
Costly Power and Water
Air/sea freight – Inadequate and expensive route structure
Agriculture increasingly uncompetitive
Preferential access [US, EU] removed

4. Challenges for IFC
What products?
What delivery model?

5. Strategy and Results Focus Areas Results 2000-2008
PRIORITY SECTORS:
Access to Finance
Infrastructure
Healthcare & Education
ITC
Tourism
* Funding means IFC plus mobilization (which incl. co-funding)
** Including DR and Haiti
Five main sources of demand consistent with our development mandate
Comparative Advantage – Tourism (Grenada, Guyana, Regional) some natural resources (T&T and Guyana)
Competitiveness – Cement, Retail, Telecom, Textiles
Infrastructure – Airports, Power
Smaller Economies – Financial, Telecom, Cement, Retail
Funded US$1.3* billion in 48 investments, plus
14 Technical Assistance in the region
* IFC’s own account + B-loan + co-funding

6. Results: Reversing a Declining Trend
In 2009, a doubling of business
More complex projects requiring industry and advisory focus

7. Recent IFC Business Development Efforts

8. Coordination between WBG, Govt, Donors and Private Sector Important
Systemic Efforts
Infrastructure
Energy Independence
World Bank study on alternative energy
(March-June 2009)
Geothermal (current)
A2F
Transportation
Inter-island Ferry (OECS)
Low-cost airline (East Caribbean)
Small businesses
Microfinance, SME
Credit bureau
Direct small investments (< $5.0 mm)
Sustainable Tourism
Linkages
Agribusiness
Vocational training
Coordination between WBG, Govt, Donors and Private Sector Important