Multilateral Partners Commit US$6.7B to Jamaica’s Post-Hurricane Recovery

Jamaica is set to benefit from a comprehensive package of up to US$6.7 billion over three years, designed to strengthen recovery and reconstruction efforts in the aftermath of Hurricane Melissa.

The funds will be facilitated through CAF – Development Bank of Latin America and the Caribbean, the Caribbean Development Bank (CDB), the Inter-American Development Bank (IDB) Group, the International Monetary Fund (IMF), and the World Bank Group (WBG).

This was disclosed in a release issued by the IMF on Monday (December 1).

The coordinated effort was undertaken at the request of Prime Minister, Dr. the Most Hon. Andrew Holness. The Prime Minister will hold a call with representatives from the international financial institutions to discuss implementation plans.

With damage estimated at US$8.8 billion, the IMF has noted that Jamaica’s recovery will require significant resources and sustained long-term investments.

It stated that comprehensive recovery planning is already under way, with a focus on critical priorities and the reinforcement of resilience.
“CAF, CDB, IDB Group, IMF and WBG are working closely with the Government of Jamaica and other partners to support this process,” the release stated.

To that end, a new financial support package of up to US$3.6 billion could be made available to finance the Government’s recovery and reconstruction programme over the next three years.

This will comprise up to US$1 billion from CAF for priority areas identified by the Government of Jamaica, up to US$200 million from the CDB to support resilient national and community infrastructure and small businesses, and up to US$1 billion from the IDB in sovereign financing for priority areas where its technical expertise and long-standing engagement can have sustained impact.

Jamaica has also requested access from the IMF to financing under the large natural disaster window of the Rapid Financing Instrument (RFI), which could amount to a loan of up to US$415 million.

The World Bank is also providing up to US$1 billion in sovereign financing, encompassing budget support, partial risk guarantees, and investment projects in critical sectors.

“To ensure Jamaica’s recovery is effective, resilient, and informed by global best practices, the five institutions are also providing technical assistance and policy advisory services —funded by grants—that draw on global experience and best practices in disaster response,” the release stated.

Thus far, US$12 million in grants has already been mobilised from the IDB, the WBG and CAF, with additional support expected.

Meanwhile, the IMF noted that engaging private capital will be essential, not only to scale up recovery efforts but also to safeguard fiscal space.

“The IDB Group’s and World Bank Group’s regional platforms are designed to blend public and private solutions from the outset. Together, IDB Invest and the World Bank Group’s International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) are actively working to attract and mobilise an initial estimate of US$2.4 billion in private investment to support Jamaica’s recovery and reconstruction – split equally between the IDB Group and the World Bank Group,” the release outlined.

Jamaica’s robust disaster risk financing framework enabled the rapid mobilisation of funds to meet urgent response needs. This framework facilitated an immediate inflow of critical liquidity to supplement the Government’s own contingency resources, for a total of US$662 million.