Hurricane Beryl fails to trigger catastrophe bond in Jamaica
October 16, 2024
The World Bank’s catastrophe (or “cat”) bonds, meant to offer immediate assistance to countries following catastrophic natural disasters, were not offered to Jamaica in the wake of the Category 4 Storm Hurricane Beryl, reports the Bretton Woods Project. Bloomberg describes cat bonds as “a bet on the probability of huge natural disasters… If the calamity doesn’t occur, investors who bought the bond stand to make big returns that could be hard to find elsewhere. If it does, buyers could lose some or all their money.”
Jamaica had specific conditions for triggering its cat bond - which were not reached during Hurricane Beryl, meaning the country did not receive the financial assistance it needed. These conditions, however, were not unique to Jamaica; most cat bonds have conditions that are incredibly specific and oftentimes difficult to meet. The former special envoy to Barbados Prime Minister Mia Mottley, Avinash Persaud, warned against the financial complexities of cat bonds, and instead urged countries to find financing to build longer-term resilience infrastructure.
As the Bretton Woods Project notes, “Cat bonds must be sufficiently profitable to attract investors, which means they can be potentially costly for climate-vulnerable countries already suffering from a severe lack of grant-based and concessional climate finance.” Bloomberg also highlights the difference between the payout received by Floridians in the wake of Hurricane Milton and the lack of assistance offered to Jamaica, opining that cat bonds “can leave vulnerable nations out of luck when disaster strikes.” The Caribbean, which is the most exposed region to climate-related natural disasters, according to the IMF, has “estimated adaptation investment needs of more than $100 billion, equal to about one-third of its annual economic output.”
Climate Justice
A new report by the Climate & Community Institute draws attention to the intertwined challenges of climate and fiscal crises, and the acute effects of both on the Global South, particularly the climate-vulnerable Caribbean.
Antigua and Barbuda, Belize, Dominica, Grenada, Guyana, Saint Lucia, St Kitts and Nevis, and St Vincent and the Grenadines have been recognized by UN special rapporteur Astrid Puentes Riaño for signing on to the Escazu Agreement and committing to protect environmental defenders. (report to the UN General Assembly available here)
If approved, a Chinese development project, currently under consideration by the Government of Grenada, will destroy 5 acres of “unique coastal and marine environment” that is home to critically endangered species. (Coral Grove Grenada)
The Resilient and Sustainable Islands Initiative (RESI) recently contributed a policy brief to the Think20, a G20 engagement group that brings together think tanks and research centers from various countries and organizations. RESI made the following recommendations for the leaders of the G20 countries to consider at the upcoming T20 Summit in Brazil:
“1. The G20 should increase Small Island Developing States (SIDS) representation by creating a ‘G20-SIDS committee’ tasked with enhancing access to concessional resources for this vulnerable group of countries, and lead the way in normalizing the use of the UN Multidimensional Vulnerability Index (MVI) to supplement GNI per capita measures with consideration of structural vulnerability in their own development assistance programmes;
2. G20 states that are members of the Green Climate Fund (GCF) Board should seek to create a minimum annual funding allocation for SIDS, the most climate-vulnerable states; and
3. The aforementioned G20-SIDS committee should work with the Paris Club to propose new measures to build confidence in the Common Framework, and increase eligibility and uptake from SIDS to improve long-term debt sustainability and increased fiscal space for resilience investments.”
In Trinidad and Tobago, the Cari-Bois Environmental News Network is training teenagers to become citizen journalists at the forefront of reporting on the threat of climate change in their community. (LatAm Journalism Review)
A 4-year old episode of the Climate Conscious Podcast is as relevant today as when it was first published: “Dr. Keston Perry advocates for a system of climate reparations for climate, environmental and economic justice. He challenges the entrenched economic systems as well as the proposed green recovery strategy. The prevailing crises presents both an immense challenge and an immense opportunity for shaping recovery and resilience. It's not about bouncing back but rather moving forward to our common future.”
The Caribbean and the World
A Stimson Center policy memo explores the need to reform the UN and UN Security Council and its significance for the Caribbean region. CARICOM member states have become increasingly vocal advocates of reform. Furthermore, “Amid the shifting balance of power, CARICOM member states—all of which are small states—deem a seat at the UNSC table as working not just to their own advantage but to the advantage of some other countries as well. (Namely, others like them with whom they have made common cause in foreign policy-related issue areas.)”
Human Rights
The Inter-American Commission on Human Rights (IACHR) has announced a technical cooperation, promotional and follow-up of recommendations visit to Belize. A delegation is visiting the country October 15th to 18th with a focus on the rights of indigenous peoples, including the Maya indigenous communities in Toledo. (press release)
Development and Finance
Marla Dukharan, Caribbean economist and advisor, spoke about tax justice for the Caribbean in her keynote speech for the Owen S. Arthur Memorial Lecture.
Antigua and Barbuda’s Sir Ronald Sanders critiques at CNG a recent World Bank report and event on Taxing Wealth for Equity and Growth: “The report fails to mention critical measures, such as: adopting the multidimensional vulnerability index as a criterion for concessional financing – a proposal actively advocated by Small Island Developing States (SIDS) and CARICOM at various global forums but not yet fully integrated into global financial policies. Additionally, debt relief, through mechanisms such as forgiveness and restructuring, remains a critical issue for the region.”
Migration
Amid the Dominican Republic’s campaign for the mass deportation of Haitian migrants (see last week’s Just Caribbean Updates), “Some of the Haitian migrants are being detained even though they have documentation and legal status in the country, with some observers questioning a lack of due process. Allegations of extortion by Dominican soldiers have also surged,” explains Jordi at Americas Migration Brief.
“Local leaders in the town of Linden (in Guyana) have criticized the national government for a lack of engagement surrounding tensions over increasing numbers of Venezuelan migrants in the community.” (News Source Guyana; via Americas Migration Brief)
Public Health
In her blog, Petchary brings attention to the mental health crisis in Jamaica, in particular the mental health of those in more vulnerable situations such as the elderly and the unhoused, among others.
Philanthropy
In a new report, the Bridgespan Group published its findings on funder collaboratives and the impacts these have on global philanthropic efforts.
Culture
A new documentary by St. Lucian nonprofit Helen’s Daughters will premiere on Wednesday, October 16. The documentary, titled “Roots of Resilience: Stories of Caribbean Women in Agriculture,” will be shown on the YouTube page of the Organization of Eastern Caribbean States (OECS).
Events
Climate Analytics Caribbean is hosting a webinar on the rising debt profiles caused by Loss and Damage in the Caribbean, additionally exploring viable solutions for the region. The event will be Wednesday, October 23rd from 10:00am - 12:30pm AST. More information available here.
Caribbean Broadcasting Corporation hosted a webinar on "Republicanism in the Commonwealth Caribbean.” A recording and more information are available here.
The World Bank is launching the 2024 World Development Report on the “middle income trap” in the Caribbean on October 17th, 10am EST. More information available here.
Opportunities
The UN Climate Technology Centre & Network (CTCN) Youth Climate Innovation Programme is holding a “comprehensive virtual initiative designed to empower young climate innovators across developing countries,” including a 7-day online event focused on generating and refining innovative climate solutions. Winning ideas advance to greater opportunities, including a 12-week intensive incubation period and potentially a 4-week acceleration program. More information available here.
The Panta Rhea Foundation is looking for a Regional Partnerships Manager focused on the Caribbean and the Americas. More information available here.
“Are you a dedicated social-change leader committed to combatting inequality? If so, the Atlantic Fellows for Social and Economic Equity (AFSEE) Fellowship program invites you to apply for their innovative, fully-funded initiative based at the International Inequalities Institute at the London School of Economics and Political Science.” More information available here.
UNDP and ILO have multiple paid internship opportunities. More information available here.
A reminder that the Commonwealth Foundation annual grants deadline is fast approaching on October 24th. Check your eligibility here. More information about these £15,000 to £30,000 grants is available here, and Frequently Asked Questions (and answers!) are available here.