IDB estimates blue economy indirectly contributes to up to 50 percent of Bahamas’ GDP, up to 73 percent of employment
NASSAU, BAHAMAS — Nearly 2,000 people employed in the blue economy are set to benefit from a $200 million policy-based guarantee (PBG) recently approved by the Inter-American Development Bank (IDB).
While the blue economy is already a major contributor to the country’s GDP, both directly and indirectly, this $200 million injection is anticipated to bolster its economic viability even more.
Highlighting the sector’s potential, the IDB pointed out that “95 percent of the 260,000 square miles that make up the country’s exclusive economic zone is the marine space — its largest development area”.
“Nearly 21.5 percent of The Bahamas’ GDP — which rises to 50 percent including indirect impacts — along with 54.5 percent of wages and 73 percent of employment are attributed to the blue economy,” the IDB stated.
“Properly managed and protected, marine resources can become a major source of economic production for the country’s MSMEs (micro, small and medium-sized enterprises), which make up 98 percent of the country’s businesses…”
It added, “The project will benefit the country’s population and firms in general, particularly those involved in the blue economy, including 249 MSMEs that employ 1,666 workers.
“This includes women-led firms, which are often smaller and younger than average, and operate in low-growth, low-profit markets.
“They also tend to be more affected by extreme weather events that tend to impact vulnerable populations, especially women and girls.
“Non-individual direct beneficiaries will include other actors in the blue economy sector through initiatives to promote their development.”
Bolstering the blue economy in times of crisis
The IDB stressed the importance of bolstering the blue economy in small island developing states like The Bahamas particularly amid rising concerns about climate change, as well as the push for economic diversification among tourism-dependent nations in the wake of the devastating COVID-19 pandemic.
It noted that the $200 million PBG will advance The Bahamas in “creating a social and inclusive blue economy” while financing projects to “promote a healthier and more productive ocean”.
“The initiative also includes reforms geared at promoting digitalization in the blue economy, strengthening the resilience of the blue economy through improved climate risk management in coastal and offshore areas, promoting better management of marine resources and reducing marine pollution,” the IDB said.
Additionally, the PBG is “expected to leverage additional resources in the international capital markets, supporting budgetary needs in a time of crucial environmental, social and economic need”.