UK Caribbean Infrastructure Partnership Fund

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On September 30, 2015 in Kingston, Jamaica, United Kingdom (UK) Prime Minister, David Cameron announced that his government would invest £300 million in vital new infrastructure such as roads, bridges and ports to help drive economic growth and development across the Caribbean region.

The Prime Minister announced the new fund on the first leg of a two-day visit focused on reinvigorating the relationship between the UK and the Caribbean countries. It will make the UK one of the largest bilateral donors to the region.

The Caribbean Development Bank (CDB) and the Department for International Development (DFID) have partnered in the implementation of the game changing UK Caribbean Infrastructure Programme (UKCIF).

UKCIF is a generous and ambitious investment by the Government of the United Kingdom in nine Caribbean countries by way of the provision of grant funding to improve or create new infrastructure.

DFID will provide up to £300m grant financing from January 2016 to March 2020 to establish a UK Caribbean Infrastructure Partnership Fund with the Caribbean Development Bank. The UKCIF will support eight ODA-eligible Commonwealth Countries and one ODA-eligible Overseas Territory to create critical economic infrastructure in the Caribbean to set the foundations for growth and prosperity, reducing poverty and increasing resilience to climate change.

The CDB will administer the fund and has set-up a dedicated team for that purpose.

The infrastructure fund will use money from the UK’s existing aid budget to provide grants over the next few years for a range of projects that will help boost growth and trade across the region and create jobs.

The Caribbean countries involved are: Antigua and Barbuda, Belize, Dominica, Grenada, Guyana, Jamaica, Saint Lucia, Saint Vincent and the Grenadines and the UK Overseas Territory – Montserrat.

Purpose

The UKCIF will provide grants to build economic infrastructure in DFID’s focus ODA-eligible countries in the Caribbean: Antigua and Barbuda, Belize, Dominica, Grenada, Guyana, Jamaica, Saint Lucia, Saint Vincent and the Grenadines and the UK Overseas Territory – Montserrat.

CDB’s allocation formula for its Special Development Fund will form the basis of the allocation of funds among beneficiaries. The UKCIF will be used to fund discrete or visible component parts of larger projects and, while co-financing may be used on larger projects for other components, the UKCIF will always constitute the majority financing.

CDB and DFID will determine whether a contingency allocation should be made as part of the initial allocation process to allow UKCIF to respond to emergencies and natural disasters that may occur during the programme. CDB and DFID will jointly assess the progress of implementation at the beginning of year 3 of the programme. Following which, a reallocation of uncommitted resources may be undertaken. Countries that cease to be ODA-eligible will no longer be beneficiaries of UKCIF as it is an ODA financed fund.

Eligibility

ODA-eligible countries are Antigua and Barbuda, Belize, Dominica, Grenada, Guyana, Jamaica, Saint Lucia, Saint Vincent and the Grenadines and the UK Overseas Territory – Montserrat. Countries that cease to be ODA-eligible will no longer be beneficiaries of UKCIF. Access Allocation Request Form.

UKCIF Priority Projects

  • Capital projects as well as projects of a Technical Assistance nature are eligible for financing from the UKCIF.  Technical assistance interventions from feasibility, through to preparation, implementation and evaluation will be eligible.
  • Projects designed to provide critical infrastructure which lay the foundations for growth and prosperity, poverty reduction and increased resilience to climate change in the Caribbean.
  • Project located within one of the eight ODA eligible counties or the one ODA eligible overseas territory.
  • Projects must be submitted by their national governments to CDB for consideration.
  • Projects must be of an infrastructure nature.  Examples would include roads; bridges; sea defences; seaports; airports; water/sanitation/wastewater; and irrigation.  Renewable energy and energy efficiency projects are also eligible for financing.
  • All interventions must be anchored within CDB’s strategic objectives to support inclusive and sustainable growth and development; and promote good governance.
  • Only projects that are assessed to be critical drivers of economic growth and able to deliver an Economic Rate of Return of at least 12% or similar qualitative benefits will be approved for financing.  Project proposals will also be assessed to ensure that adequate environmental, social and gender safeguards, in accordance with the appropriate CDB polices/guidelines, are incorporated into project design. 

Impact and Outcome

Impact

Laying the foundations for enhanced and sustained economic growth.

Outcome

Improved critical infrastructure spurs increased trade, tourism and private investment.

Output 1

Key critical infrastructure built in DFID focus countries.

Output 2

Best practice models of infrastructure developed (e.g. climate resilient and/or social impact) and replicated across the region.

UKCIF direct results up to May 2020

  • at least two major or possibly one larger infrastructure project, delivered in each of the focus countries and territories in the following sectors (roads, bridges, renewable energy, water, sea defences and ports, sanitation/wastewater management);
  • projects that deliver at least a 12% economic return on investments; and
  • flagship projects that demonstrate resilience in design and are capable of withstanding extreme weather events.

Other tangible benefits

  • operation and maintenance plans for the UKCIF’s projects in place; and
  • improved capacity in governments for the management of operation and maintenance of their infrastructure stock.

Indirect benefits

The UKCIF will deliver jobs and improvements in livelihoods and help incentivise positive policy action in the region.

  • Jobs and improvements in livelihoods

Although not directly measured by this programme, wider benefits will be delivered to the poor. The poor will benefit directly through employment in the construction, maintenance and operations of the built assets, and by using the infrastructure services generated by the built assets.

These assets allow them to access markets, health and education facilities, while lower prices for energy would increase overall disposable income and reduce business costs.

The poor can also benefit indirectly as a result of the spill-over effects from the economic growth generated by the infrastructure services. New, cheaper and reliable infrastructure services allow businesses to grow through lower production and transaction costs leading to an increase in trade. The poor can benefit from the jobs created by these businesses, self-employment opportunities and from governments investing the additional tax revenue generated by the economic growth in public services.

  • Incentivising positive action

The UKCIF offers the UK the opportunity to promote a world-class approach to delivering infrastructure that is fully transparent, free from corruption, and consistent with good governance and wider economic reforms that promote growth.

  • Reducing gender inequality

The promotion of gender equality will be actively pursued in this programme. Investment in infrastructure is seen as an important means to improve the access to services, markets and economic opportunities for both men and women.  Possible benefits include improved incomes, better health and improved safety.

Resources and Documents

Brochure: The UK Caribbean Infrastructure Programme

United Kingdom Caribbean Infrastructure Partnership Fund: Ratification of Contribution by the Government of the United Kingdom of Great Britain and Northern Ireland, through the Department for International Development

News

UKCIF funds for study to rehabilitate road from Linden to Mabura Hills in Guyana
CDB approves grant to finance study for road rehabilitation in Belize
Grant to support study for rehabilitation of sea defences in Guyana
Essex Valley farmers to benefit from GBP35.5 million grant
GBP13.9 mn road rehabilitation project launches in Antigua and Barbuda
CDB approves grant for study on water and sewerage facilities in Grenada
CDB approves GBP13.9 mn grant to rehabilitate road network in Antigua and Barbuda
CDB approves USD194 mn programme of assistance for Guyana
UKCIF funds for road rehabilitation study in Belize
UKCIF Funds to rehabilitate Road Networks in Antigua and Barbuda, Dominica
Caribbean Development Bank UK Road Show: UK Firms to be Exposed to Potential Commercial Opportunities from the UK-Caribbean Infrastructure Fund
UK Prime Minister David Cameron announces £300 million fund for Caribbean Infrastructure
The Caribbean Council and British Expertise brief 70 participants on the £300 million UK Caribbean Infrastructure Fund

UK Caribbean Infrastructure Fund Open for Business 

Guyana to benefit from UK’s Caribbean Infrastructure Fund
Britain launches $300 million Caribbean Infrastructure Fund
CDB delegation visits Guyana

 

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