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Emerging Markets

Hurricane-ravaged Caribbean islands demand polluters pay for rebuild

Gaston Browne 100

Gaston Browne thinks that developed countries are contributing to the frequency and savagery of hurricanes with their carbon emissions and that they therefore should write off debts and help his country rebuild

Gaston Browne
Browne: debt swaps

Antigua and Barbuda’s prime minister, Gaston Browne, wants wealthy nations responsible for much of the world’s pollution to pay for the reconstruction of his islands following a devastating hurricane in  September that flattened a large part of his country. 

“We need to look at novel instruments, such as climate for debt swaps,” Browne told GlobalMarkets. “Countries in the Caribbean are negligible polluters so there ought to be a mechanism for us to write off debt to create fiscal space to fund greater resiliency and adaptation to climate change.

“We think that the developed countries are contributing to the frequency and atrociousness of these storms with their carbon emissions. They have some liability and should help us to rebuild,” he said.  

Browne estimates that about $250m will be needed to rebuild Barbuda, which was destroyed by Hurricane Irma. The country has received around $10m in grants and is looking to the World Bank and Caribbean Development Bank for up to $100m in loans, but new loans could have a negative impact for the already highly indebted nation. 

The country’s debt has dropped in the past few years from 102% of its $1.4bn GDP to 75%, but this will creep up again as it rebuilds. 

“We have made enormous gains in the past three years, but those gains will be eroded as we start taking loans,” he said. 

Branson Marshalls plan

Browne and other Caribbean leaders have endorsed a call by Richard Branson, founder of the Virgin Group, to launch a “Marshall Plan” for the Caribbean that would build resiliency to natural disasters. 

“Richard Branson has shined a spotlight that this is the consequence in no small part of rising temperatures creating greater energy in storm systems that could quite possibly be a recurring problem. If the rebuilding does not emphasise resilience we could see this again and that is a pretty harrowing scenario to envision,” said Roy Torbert, of the Island Energy Program at the Branson-backed Carbon War Room-Rocky Mountain Institute. 

A key component is energy, transitioning the Caribbean from fossil fuels to renewable energy, primarily solar and wind power, and redesigning grid systems to get electricity lines underground instead of poles. 

Torbert said the cost for nine Eastern Caribbean islands to move from fossil fuels is estimated at up to $3bn over the coming 20 years. The investment would be offset by at least $1bn in savings on fuel. Fuel is one of the largest expenditures for regional governments. Antigua and Barbuda spends the equivalent of 12% of GDP on fuel imports. 

Barbuda could shape up as a test case. Browne said the reconstruction was not only going to make the island resilient, but also green. “Within the next 12 months we expect Barbuda to become the only totally green island on the planet, powered exclusively by alternative energy,” he said. 

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