The Caribbean Development Bank (CDB / the Bank) and the Green Climate Fund (GCF) have signed a Funded Activity Agreement (FAA) for the Climate Resilience of the Water Sector in The Bahamas project, unlocking a transformative US$65.2 million initiative to safeguard the country's freshwater supply against intensifying climate threats. The project is expected to deliver direct benefits to over 215,000 people while providing indirect benefits to the entire country. 

The FAA was signed by Dr. Isaac Solomon, Vice President (Operations), CDB, and Ms. Kristin Lang, Director, Department of the Latin America and the Caribbean Region, GCF. 

The initiative is being delivered by CDB as the Accredited Entity, in close collaboration with The Bahamas Water and Sewerage Corporation (WSC), the Office of the Prime Minister (as the GCF National Designated Authority for The Bahamas), and other key water sector stakeholders. 

Highlighting the potential impact of the project, Dr. Solomon said, “This agreement marks an important step in strengthening climate resilience across the Caribbean. Water security is vital to every Bahamian community, and this project will help protect critical resources from growing climate threats. We thank the GCF and the people of The Bahamas for their partnership in delivering transformational outcomes.” 

The Bahamas is frequently exposed to extreme weather events. According to the feasibility study prepared for the project, 83 percent of the country’s land area lies less than five metres above sea level, making it one of the world’s most climate-vulnerable nations. The study also notes that 81 percent of the country’s water production comes from energy-intensive desalination, increasing both costs and vulnerability. As a result, the country’s water supply infrastructure faces growing threats from hurricanes, storm surges, overland flooding, and sea level rise. 

Underscoring GCF’s commitment to supporting climate adaptation, Ms. Lang said, “The Bahamas exemplifies the urgent challenges facing small island developing states on the front lines of climate change. This project represents a paradigm shift—moving an entire water sector toward integrated, climate-resilient management while reducing dependence on vulnerable desalination. GCF is proud to partner with CDB to bring durable and resilient water security to the people of The Bahamas.” 

The project will address national water infrastructure challenges by strengthening governance, institutional capacity, and climate-resilient infrastructure across six vulnerable islands: South Andros, North and Central Andros, Mangrove Cay, Abaco, Acklins, and New Providence. The initiative is expected to strengthen water sector policies, legislation, regulations, improved water resources data and planning, and investments in water supply infrastructure and operations. Collectively, these interventions will support a system-wide transition to integrated, climate-resilient water resource management. 

Welcoming the project as a critical investment in national resilience, Ms. Rochelle Newbold, Special Advisor for Climate Change and Environmental Matters, Office of the Prime Minister of The Bahamas, said, “For The Bahamas, water security is a matter of national survival, and this project will deliver lasting protection for communities across our country. We thank the Caribbean Development Bank and the Green Climate Fund for their partnership in advancing a more resilient, sustainable future for present and next generations of Bahamians.”

Emphasising the benefits of the project for The Bahamas, Mr. Robert C. Deal, Jr., General Manager, WSC, said, “We are excited to serve as Executing Agency of this transformative initiative as it aligns closely with our broader commitment to strengthening water security, improving service reliability, and building a more sustainable and resilient water sector for The Bahamas. It will improve efficiency, strengthen infrastructure, reduce climate vulnerabilities, and ensure customers have reliable access to safe, potable water.” 

The project is supported by US$50.05 million in financing from the GCF, comprising a grant of around US$37.51 million and a concessional loan of about US$12.54 million. CDB and partners are contributing a further US$15.15 million in loan and in-kind co-financing. Implementation is expected to begin in 2027 and continue over seven years.  The investment builds on CDB’s enhanced GCF accreditation, which allows the Bank to develop and deliver individual GCF-financed initiatives of up to US$250 million.