Caribbean SIDS Investment Proposal
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Caribbean SIDS Investment Plans and Opportunities |
The Proposal
In 2024, the Hand-in-Hand Regional Initiative for the Caribbean is being launched, participating for the first time in the third edition of the Investment Forum.
Caribbean countries have been severely impacted by climate change and the difficulty of maintaining production across a six to eight-month dry season. Increased water variability (i.e., scarcity and flooding), pollution, watershed degradation, and saline intrusion affect the feasibility of sustained cultivation of key crops, increasing risks of food insecurity and limiting the growth potential of smallholder livelihood. Climate change is worsening the severity of these challenges, and response capacities are aggravated by increasing intensity of extreme weather events (like hurricanes and thunderstorms) that cause sudden and long-lasting material, human, environmental, social and financial losses.
Barbados, Jamaica and Saint Vincent & the Grenadines all have the potential to implement efficient and sustainable year-round irrigation systems, which can bring many benefits to farmers, including increasing agricultural productivity, augmenting production cycles (up to five harvests per year in the case some vegetables), and improving water security to sustain human and ecosystem needs. Sustained production capabilities are crucial to promote resilience in the face of climate challenges and raise the annual incomes of smallholders to fulfill their growth potential, driving an inclusive and sustainable rural transformation.
The investment proposal for the HIH Regional Initiative in the Caribbean is currently under development through a strong partnership with the Caribbean Community (CARICOM). The proposal package intends to enhance food and income security through sustainable irrigation projects responsive to local constraints and opportunities, improving overall agricultural productivity in the Caribbean region through year-round access to sustainable water for irrigation, improved water management practices, and finally, strengthened capacities for irrigation and crop cultivation.
It’s expected to cost USD 21.12 million, at an average internal rate of return (IRR) of 23.8% and total net present value (NPV) of approximately USD 20.26 million. Together, the governments of Barbados, Jamaica, and Saint Vincent and the Grenadines have contributed over USD 1.9 million to fund institutional, technical, and financial support in preparation for the projects, leaving an investment gap of USD 19.2 million for which external funding is sought. The proposals will directly benefit 635 families and indirectly support the livelihoods of 4,000 individuals. On average, per capita incomes are expected to increase by USD 1,235 per hectare, per year.
Lastly, the proposals align with CARICOM’s 25 x 2025 goal related to enhancing sustainable irrigation systems to improve domestic productivity, lower food import costs by 25% by 2025, sustain import substitution, and increase local production of healthy and nutritious foods.
Total Investment | USD 5.64 Million |
Investment Identified | |
NPV Value | USD 4.92 Million |
IRR Value | 21% |
Total Beneficiaries | 798 |
Indirect Beneficiaries | 698 |
Direct Beneficiaries | 100 (families) |
per capita income increase | USD 1,157 per hectare/year |
EXACT TOOL |
Total Investment | USD 7.58 Million |
Investment Identified | |
NPV Value | USD 6.05 Million |
IRR Value | 20.9% |
Total Beneficiaries | 4,492 |
Indirect Beneficiaries | 1,292 |
Direct Beneficiaries | 200 (families) |
PER CAPITA INCOME INCREASE | 1,311 USD per hectare/year |
EXACT TOOL |
Total Investment | USD 5.99 Million |
Investment Identified | |
NPV Value | USD 9.28 Million |
IRR Value | 29.6% |
Total Beneficiaries | 2,345 |
Indirect Beneficiaries | 2,010 |
Direct Beneficiaries | 335 (families) |
PER CAPITA INCOME INCREASE | 1,236 USD per hectare/year |
EXACT TOOL |
Caribbean SIDS Typologies
Poverty
Potential
Efficiency
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Initiative of Caribbean SIDS: Investment cases in the Caribbean SIDS
Caribbean SIDS Investment Cases and Interventions
 | Rainwater Harvesting Pond - Barbados5.64 Million USD798 Beneficiaries |
The project aims to construct a rainwater harvesting pond system to capture runoff from the Spring Hall/Chance Hall watersheds for existing and planned farms in the surrounding area. These irrigation ponds seek to provide a sustainable water source for farmers during the dry season (January to May) in Saint Lucy Parish. Existing natural ponds are set to be deepened and connected to smallholder farms via pipelines. The technical capacity of such ponds to provide year-round irrigation was demonstrated following a feasibility study carried out by Stantec Consulting Caribbean for the Barbados Agricultural Development and Marketing Corporation (BADMC).
The investment cost is estimated at about USD 5.64 million, with 40 hectares of irrigable areas being reached. The main value chains that will be reached by the new irrigation ponds and be cultivated over an unprecedented two to three yearly production cycles include beans, beets, cassava, cucumber, lettuce, okra, onions, pumpkin, squash, sweet pepper, sweet potato, tomato, watermelon, yams, spinach, and carrots. Increased production is expected to raise per capita incomes by USD 1,157 per hectare per year, among the project's 698 beneficiaries. This investment has an estimated internal rate of return (IRR) of 21% and a net present value (NPV) of over USD 4.92 million. Barbados’ Government has committed USD 564,000 to the project, leaving a gap of approximately USD 5.08 million to be filled by external investors.
| Surface Pump Irrigation Infrastructure - Jamaica7.58 Million USD4,492 Beneficiaries |
Implementing Surface Pump Irrigation Infrastructure in Lucky Hill Pen (Jamaica)
This project focuses on building irrigation infrastructure in the White River watershed (located at the Lucky Hill Pen area in St. Mary parish). Specifically, the project will install surface pump irrigation systems to irrigate 400 hectares of land, on which 200 smallholder farms cultivate Irish potato, pumpkin, and sweet potato. Empowered by reliable infrastructure services and technical assistance programs increasing smallholder capacity to manage water usage, production, and commercialization, the project is expected to increase production by 60%. Besides contributing to increase per capita incomes, knowledge transfers will support the sustainability of investment outcomes in the long-term.
It is estimated to cost USD 7.58 million, which entails installing power supply, pump stations, energy saving devices, pipe network and farm service connections, and technical support. 1,292 people are expected to receive benefits from this project, including a per capita income increase of USD 1,311 per hectare per year. The Jamaican Government has dedicated USD 758,000 to the project, leaving an investment gap of approximately USD 6.82 million for which external funding is sought. The project’s estimated IRR is 20.9%, while its NPV is approximately USD 6.05 million.
 | Rabacca Irrigation System - Saint Vincent & the Grenadines5.99 Million USD2,345 Beneficiaries |
The Saint Vincent & the Grenadines project focuses on rehabilitating irrigation infrastructure located in the Rabacca region, and to provide better irrigation services to farmers operating lands in these areas. This will involve renovating existing pipelines, installing new pipe connections and water storage tanks, as well as new pipe connections linking new and rehabilitated infrastructure to smallholders. The Rabacca River has a large base flow but is normally dry at its mouth because of the high permeability of the riverbed material. The project will therefore install a pipeline directly in the riverbed, responding to this systemic bottleneck.
The project aims for consistent production throughout the year (including dry season) by enabling production and reducing price fluctuations, increasing yields per hectare, enhancing ability of farmers to fertilize crops through an irrigation system, and strengthening economic activity in the northeastern side of the island. The main crops cultivated in the area, whose production will be supported with year-round water security, include bananas, plantains, root crops, vegetables, and tree crops.
The project cost is estimated at about USD 5.99 million and will supply water to 324 hectares of land managed by about 335 family farms. Per capita incomes are expected to increase by USD 1,236 per hectare per year, for the project's 2,010 beneficiaries. The project’s IRR is estimated to be 29.6%, at an NPV of USD 9.28 million. The national government has committed USD 599,000 to lay the groundwork for this project, leaving a gap of USD 5.39 million, for which external investment is sought.
