Document of The World Bank FOR OFFICIAL USE ONLY Report No. 66577-LAC INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION AND INTERNATIONAL FINANCE CORPORATION PROGRESS REPORT ON THE REGIONAL PARTNERSHIP STRATEGY FOR THE ORGANIZATION OF EASTERN CARIBBEAN STATES (OECS) FOR THE PERIOD 2010-2014 April 1, 2012 Caribbean Country Management Unit Latin America and Caribbean Region International Finance Corporation Latin America and Caribbean Region This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank’s Policy on Access to Information. The last Regional Partnership Strategy for the OECS was discussed by the Executive Directors on June 8, 2010. CURRENCY EQUIVALENTS Currency Unit: Eastern Caribbean Dollar (EC$) US$1.0 = EC$ 2.70 $ in the text refers to US$ unless otherwise stated. FISCAL YEAR Antigua and Barbuda, St. Kitts and Nevis, St. Vincent and the Grenadines: January 1 – December 31; Grenada, St. Lucia: April 1 – March 31; Dominica: July 1 – June 30 IBRD IFC Vice President Hassan Tuluy Vice President Thierry A. Tanoh Country Director Françoise Clottes Regional Director Paolo M. Martelli Task Team Leader Rolande Pryce Task Manager Eduardo Wallentin The World Bank Group appreciates the collaboration of the OECS governments and other stakeholders, including the Eastern Caribbean Central Bank and the OECS Secretariat, and the invaluable contributions of the following staff members, during the preparation of this Strategy: Hannah Kim; Ole Jorgenson; Nathalie Picarelli; Elisabeth Mekonnen; Anjali Acharya; Augusto de la Torre; Bruce Courtney; Caroline Cerruti; Chandra Shekhar Sinha; Christina Malmberg Calvo; Christine Richaud; David Warren; Edith Mwenda; Erik Bloom; Galina Sotirova; Harriet Nannyonjo; Juan Navas-Sabater; Justin Locke; Kirk Ifill; Karla McEvoy; Kathy Lalazarian; Lily Chu; Michelle Ottey; Nyaneba Nkrumah, Pedro Andrés Amo; Shiyan Chao; and Tiguist Fisseha. ii TABLE OF CONTENTS ORGANIZATION OF EASTERN CARIBBEAN STATES REGIONAL PARTNERSHIP STRATEGY – PROGRESS REPORT I. INTRODUCTION............................................................................................................................... 1 II. POLITICAL, ECONOMIC AND SOCIAL DEVELOPMENTS ....................................................... 2 III. TAKING STOCK AT MID -TERM ................................................................................................... 3 A. Assessing Progress Towards Outcomes .................................................................................. 3 B. Analyzing Portfolio Performance and Implementation ........................................................... 9 IV. ADJUSTMENTS TO THE RPS ......................................................................................................... 9 V. LOOKING AHEAD.......................................................................................................................... 12 VI. RISKS ............................................................................................................................................... 13 TABLES Table 1: Indicative and remaining IDA 16 allocations ............................................................................... 13 APPENDICES Appendix 1: RESULTS MATRIX for the RPS FY10-FY14...................................................................... 15 Appendix 2: Actual and Indicative Lending Program for the RPS FY10 - FY14 ...................................... 20 Appendix 3: Actual and Indicative Trust Funds/Grants Program for the RPS FY10-FY14 ....................... 21 Appendix 4: Actual and Indicative AAA (ESW + TA) Program for the RPS FY10-FY14 ....................... 22 Appendix 5: Actual and Indicative Lending Volumes for RPS FY10-FY14 ............................................. 23 iii STANDARD CAS ANNEXES ANTIGUA AND BARBUDA .................................................................................................................... 24 Annex 1: Country Profile .............................................................................................................. ..24 Annex A2: Country at a Glance ...................................................................................................... 26 Annex B5: Poverty and Social Indicators ....................................................................................... 29 Annex B6: Key Economic Indicators ............................................................................................. 30 Annex B8: (IFC) Committed and Disbursed Outstanding Investment Portfolio ............................ 32 DOMINICA ................................................................................................................................................ 33 Annex 1: Country Profile ................................................................................................................ 33 Annex A2: Country at a Glance ...................................................................................................... 35 Annex B2: Selected Indicators of Bank Portfolio and Management .............................................. 38 Annex B5: Poverty and Social Indicators ....................................................................................... 39 Annex B6: Key Economic Indicators ............................................................................................. 40 Annex B7: Key Exposure Indicators .............................................................................................. 42 Annex B8: Operations Portfolio (IBRD/IDA and Grants) .............................................................. 43 GRENADA ................................................................................................................................................. 44 Annex 1: Country Profile ................................................................................................................ 44 Annex A2: Country at a Glance ...................................................................................................... 45 Annex B2: Selected Indicators of Bank Portfolio and Management .............................................. 48 Annex B5: Poverty and Social Indicators ....................................................................................... 49 Annex B6: Key Economic Indicators ............................................................................................. 50 Annex B7: Key Exposure Indicators .............................................................................................. 52 Annex B8: (IFC) Committed and Disbursed Outstanding Investment Portfolio ............................ 53 Annex B8: Operations Portfolio (IBRD/IDA and Grants) .............................................................. 54 ST. KITTS AND NEVIS ............................................................................................................................ 55 Annex 1: Country Profile ................................................................................................................ 55 Annex A2: Country at a Glance ...................................................................................................... 57 Annex B2: Selected Indicators of Bank Portfolio and Management .............................................. 60 Annex B5: Poverty and Social Indicators ....................................................................................... 61 Annex B6: Key Economic Indicators ............................................................................................. 62 Annex B7: Key Exposure Indicators .............................................................................................. 64 ST. LUCIA.................................................................................................................................................. 65 Annex 1: Country Profile ................................................................................................................ 65 Annex A2: Country at a Glance ...................................................................................................... 66 Annex B2: Selected Indicators of Bank Portfolio Performance and Management ......................... 69 Annex B5: Poverty and Social Indicators ....................................................................................... 70 Annex B6: Key Economic Indicators ............................................................................................. 71 Annex B7: Key Exposure Indicators .............................................................................................. 73 Annex B8: Operations Portfolio (IBRD/IDA and Grants) .............................................................. 74 ST. VINCENT AND THE GRENADINES ............................................................................................... 75 Annex 1: Country Profile ................................................................................................................ 75 Annex A2: Country at a Glance ...................................................................................................... 77 Annex B2: Selected Indicators of Bank Portfolio Performance and Management ......................... 80 Annex B5: Poverty and Social Indicators ....................................................................................... 81 Annex B6: Key Economic Indicators ............................................................................................. 82 Annex B7: Key Exposure Indicators .............................................................................................. 84 Annex B8: Operations Portfolio (IBRD/IDA and Grants) .............................................................. 85 iv ABREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities ICT Information and communications technology Bank World Bank IDA International Development Association BAICO British American Company IDF Institutional Development Fund BNPP The Bank Netherlands Partnership Program IFC International Finance Cooperation CAD Canadian Dollars IFI International Financial Institution CARICOM Caribbean Community IMF International Monetary Fund CARTAC Caribbean Regional Technical Assistance LAC Latin America and the Caribbean CAS Country Assistance Strategy MSME Micro, small and medium sized enterprise CDB Caribbean Development Bank NCD Non-communicable diseases CIDA Canadian International Development NLTA Non-lending technical assistance Agency CLICO Colonial Life Insurance Company OECS Organization of Eastern Caribbean States CPA Country Poverty Assessment P4R Program for Results CPI Corruption Perception Index PPCR Pilot Program for Climate Resilience CPPR Country Portfolio Performance Review PPP Public Private Partnership DEMPA Debt Management Performance PSDP Private Sector Development Partnership Assessment DFID Department for International Development SPL Saint Lucia Labour Party DPL Development Policy Loan SDR Special Drawing Rights DVRP Disaster Vulnerability Reduction Project SIDS Small Island Developing States Sustainable DOCK Energy Initiative ECCB Eastern Caribbean Central Bank ECCU Eastern Caribbean Currency Union SEMCAR Supporting Economic Management in the Caribbean ECERA Regional Energy Regulator Program SME Small and Medium Enterprise EGRIP E-Government for Regional Integration SWAp Sector -wide approach Project EPIC Entrepreneurship Program for Innovation RDVRP Regional Disaster Vulnerability Reduction in the Caribbean Project ESMAP Energy Sector Management Assistance RPS Regional Partnership Strategy Program ERL Emergency Recovery Loan TAC Technical Assistance Credit FDI Foreign Direct Investment TFSCB Trust Fund for Statistical Capacity Building FY Fiscal Year UK United Kingdom GDP Gross Domestic Product UNDP United Nations Development Program GEF Global Environment Facility UNICEF United Nations Children’s Fund GFDRR Global Facility for Disaster Risk Reduction UN United Nations Entity for Gender Equality and Recovery Women and the Empowerment of Women (previously DAW, INSTRAW, OSAGI, and UNIFEM) GNI Gross National Income US United States HDI Human Development Index WB World Bank HMIS Health Management Information System IBRD International Bank for Reconstruction and Development v   I. INTRODUCTION 1. In June 2010, the Board of Executive Directors of the World Bank (Bank) discussed a joint Bank/IFC Regional Partnership Strategy (RPS or Strategy) for the six independent territories of the Organization of Eastern Caribbean States1 (OECS) (Report No. 53762 – LAC). The Strategy covers a five year period which coincides with the duration of the election cycles in all six countries, although the timing of the elections in the countries is not aligned. The inter-related strategic objectives of the RPS are: (a) building resilience; and (b) enhancing competitiveness and stimulating growth over the medium term. This Progress Report assesses the implementation of the Strategy at the mid-term and outlines how the Bank will position itself strategically for the remainder of the RPS period. 2. The OECS countries were among the countries in the world hardest hit by the global financial and economic crisis and have experienced a significant lag in recovery relative to other countries in the Latin American region. Economic growth in the OECS has been severely undermined, with ripple effects across the economies, particularly through a decline in tourism activity and the FDI related construction sectors upon which these countries depend. Furthermore, the agriculture sector contracted due to pest infestation, drought and Hurricane Tomas in October 2010. The global slowdown also exacerbated existing weaknesses in the financial sector, increasing the risk of spillovers across countries. In addition, limited fiscal space, the result of high debt and debt service, severely constrained the governments’ ability to implement countercyclical policies to cushion the impact of the crisis. As a consequence, vulnerability across the region has increased and remains a major element of concern going forward. On the positive side, however, the OECS continued to pursue ambitious goals for further political and economic integration with the implementation of the OECS Economic Union. 3. The interventions proposed under the RPS remained valid and have targeted critical vulnerabilities that the countries face. The Bank has deployed a suite of instruments, including knowledge service coupled with development policy loans and investment loans in the following areas: (a) improving fiscal and debt sustainability; (b) protecting and improving human capital; (c) strengthening climate resilience; (d) strengthening the domestic financial sector; and (e) improving access to quality services for a more competitive business environment. 4. Progress has been slow but in most cases RPS outcomes remain achievable. For the most part, the investment projects and development policy loans programmed in the RPS are on track, albeit with adjustments in timing and level of financing to ensure effective use of IDA and leverage additional highly concessional financing from other sources. In the first half of the RPS (FY10-12), the Bank has provided record support to the OECS, with $85 million in lending projects, $32.7 million in grants and a sizeable increase in Bank-executed technical assistance. 5. While the Strategy remains relevant, going forward, increasing vulnerabilities and global economic conditions call for flexibility to permit the Bank to be responsive to client demands. In the second half of the RPS period, rising debt levels, financial sector vulnerability 1 While the OECS comprises six independent countries and three British Overseas Territories, this Strategy covers only the six independent countries, namely: Antigua and Barbuda; Dominica; Grenada; St. Kitts and Nevis; Saint Lucia; and St. Vincent and the Grenadines. Excepting St. Vincent and the Grenadines which did not join IFC, all are members of the World Bank Group. 1 and the impact of a possible double dip recession create a high degree of uncertainty for the OECS. Policy discussions with the authorities on these matters have intensified over the RPS period and once they mature, and the appropriate policy responses are identified, the countries will signal the type of Bank support they prefer. Whatever the outcome of that dialogue, the key objectives of fostering a regional approach to building resilience and in addressing structural constraints to growth remain highly relevant in these small and vulnerable economies, given the perverse interaction between vulnerability and small size. II. POLITICAL, ECONOMIC AND SOCIAL DEVELOPMENTS 6. Although there have been some changes in the political landscape, policies at a regional level have remained relatively consistent. Prime Minister Dr. Ralph Gonsalves of St. Vincent and the Grenadines was re-elected for a third consecutive term by a one seat majority over the opposition in December 2010. Prime Minister Dr. Kenny Anthony of Saint Lucia (hereinafter referred to as St. Lucia) triumphed over the incumbent to win 11 of 17 seats during the November 2011 elections. The Revised Treaty of Basseterre Establishing the OECS Economic Union came into force on January 21, 2011, with the ratification of five Member States: Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, and St. Vincent and the Grenadines. The implementation of the Revised Treaty has been slow but steady, a daunting undertaking for any group of countries but especially for the small states of the Eastern Caribbean in light of their inherent constraints. Some Member States have not enacted the required enabling legislation to bring the Revised Treaty into effect as yet, however, the Member States have taken practical steps to implement the free movement of persons. 7. The impact of the global economic and financial crisis in 2009 was deeper in the OECS than in the rest of the Latin America and Caribbean region and there has been a significant lag in recovery. In the period 2003-08, real GDP grew at an annual rate of about 5 percent average annual growth. However, in 2009, growth contracted by 5.7 percent manifested by a steep decline in tourism activity (9.2 percent) and the FDI-related construction sector (21.7 percent). Contraction persisted in most of the OECS member countries in 2010, at an average of -2.2 percent of GDP. The effect of Hurricane Tomas on St. Vincent and the Grenadines and St. Lucia in the last quarter of 2010 contributed to the slower recovery. Recovery remained subdued in 2011 as real GDP growth is expected to reach 0.6 percent owing to a weaker than expected pick up in construction and tourism activity. Growth will be spearheaded by St. Lucia and Dominica, while Grenada, St. Kitts and Nevis, and Antigua and Barbuda are expected to stagnate. Only St. Vincent and the Grenadines is still expected to mildly contract (-0.4 percent of GDP). 8. Total public debt levels surged as a consequence of the global downturn, with the overall OECS public debt rising by 13 percent of GDP between 2008 and 2010 to 85 percent of GDP at year-end 2010, thus keeping interest and debt service payments between 17 and 33 percent of current revenues in 2011. Given tight fiscal constraints, the capacity of OECS countries to implement counter-cyclical policies to cushion the impact of the crisis was limited. Most governments, guided by the Eastern Caribbean Currency Union (ECCU) Eight Point Stabilization and Growth Programme, underwent some degree of fiscal consolidation. As a result, the overall fiscal deficit in the OECS diminished from 6.9 percent of GDP in 2009 to 3.8 2 percent of GDP in 2010. However, the countries’ fiscal position remained fragile in 2011, with a deficit of 3.9 percent of GDP. 9. The 2009 global financial crisis also aggravated existing weaknesses in the OECS financial sector. The global crisis affected the main sources of growth, in particular tourism and real estate, and resulted in difficult macro-economic conditions in the OECS. Financial sector health indicators have deteriorated, as non-performing loans have increased, putting pressure on profitability and capital levels. Further, the weakness of the real estate market makes it difficult for banks to realize real estate collateral. In July 2011, the largest domestic bank in Antigua and Barbuda which accounts for 3.2 percent of the total assets of the ECCU banking system was taken over by the Central Bank. Meanwhile, the resolution of the failed insurance companies, British American Insurance Company (BAICO) and Colonial Life Insurance Company (CLICO), is still ongoing. It is estimated that the exposure of the OECS countries to CLICO and BAICO is about 12 percent of GDP and the loss of income from these insurance policies is, among other things, weighing on growth. Going forward, financial sector instability, high vulnerability to natural disasters, a protracted demand slump in the US and a potential double–dip recession due to conditions in Europe, pose significant risks to fiscal sustainability, given the OECS countries’ ranking as some of the most highly indebted countries in the world. 10. OECS countries rank between 60 and 85 of 187 countries and are categorized as having high human development according to the 2011 UNDP Human Development Index (HDI). At 60, Antigua and Barbuda ranked the highest of all the OECS countries and at 85 St. Vincent and the Grenadines ranked the lowest. This places the OECS above the global small island developing states average for each indicator measured: life expectancy at birth, mean years of schooling; expected years of schooling and gross national income. The HDI also places the OECS countries slightly above the Latin America and Caribbean regional average and above other Caribbean countries like the Dominican Republic, Guyana and Suriname, but below Barbados and The Bahamas. Poor school retention and achievement among boys is one of the most important gender challenges confronting the OECS Member States. Boys have on average 1.1 percentage point more drop outs than girls. Secondary dropout rates for males can impose large social cost with high rates of idleness and criminality. To generate evidence on what works to retain boys in school and perform well while there, the Bank has been implementing the Boys at Risk Initiative in the Caribbean to enhance local capacity for monitoring and evaluation of successful interventions with at-risk youth. Finding consistently compiled and comprehensive social data, including progress towards achieving Millennium Development Goals, however, is a persistent challenge that was underscored in the RPS. The Bank in partnership with the OECS Secretariat has embarked on a number of complementary initiatives targeted at enhancing the collection of social data and supporting the establishment of mechanisms targeted at capturing, tracking and analyzing social indicators and statistics more systematically. III. TAKING STOCK AT MID-TERM A. Assessing Progress Towards Outcomes 11. Progress towards RPS outcomes has been moderate; with some notable advances in protecting and improving human capital and strengthening climate resilience and slow progress on improving access to quality services, while progress has been mixed on 3 strengthening the domestic financial sector with significant achievements in the insurance sector and slower progress on banking. Approximately a third of the outcomes have been achieved, with the others on track to be met by the end of the RPS period. The focus of the RPS thus far has been to provide urgent remedial measures to address the crippling effects of the global and regional crisis; however, in practice this has meant attempting to institute measures to address critical vulnerabilities which, if successful, will have positive effects in the short and medium terms. The results matrix in Appendix 1 summarizes progress to date across the Bank program. 12. Implementing the sub-regional/multi-country approach, while essential to support the OECS’ regional integration efforts, has been challenging. OECS Member States acknowledge that deepening regional integration is indispensable to improving institutional capacity and addressing scale economy constraints thereby building resilience. In fact, the strong focus on institutional capacity building across a number of sectors including financial sector, public financial management, energy, is expected to improve governance across the region. In that connection, while highlighting the challenges inherent in this approach, the RPS proposed to focus the delivery of Bank support in lending, grant and knowledge activities on sub- regional/multi-country operations where consistency in policy and action would produce significant cross-border benefits, to avoid further fragmentation among what are already small units. Leading with technical assistance at the regional level to build constituency, develop action plans and share knowledge, and supporting that further with analytical work, has borne fruit but has taken time. Due to capacity constraints and the need for coordination, often times at the highest political levels, deploying sub-regional/multi-country projects has been slow. Thus, there have been delays in project preparation and effectiveness. 13. The Bank is committed to the sub-regional/multi-country approach that capitalizes on its experience in accompanying OECS Member States in the establishment of regional institutions and the successful execution of multi-country operations. The Eastern Caribbean Telecommunications Regulatory Authority was established and supported with financing and technical assistance from the World Bank. Multi-country operations in education and health, that provided opportunities for harmonization of policies, exploiting economies of scale in procurement of goods and services, and shared learning, were supported through Bank financing and technical assistance. The Bank has observed the significant benefits associated with pursuing the sub-regional/multi-country approach within the OECS, including enhancing overall development impact, permitting access to a larger pool of concessional resources through regional IDA and improving project implementation and the cost-effectiveness of Bank services, and remains committed to this course. 14. Due to small scale and related challenges unique to the OECS, there are limited opportunities for IFC investment services; however, there has been significant uptake in IFC advisory services during the first half of the RPS period. The IFC’s program is based on four strategic pillars: crisis response; financial inclusion and job creation; regional integration and competitiveness; and climate change. IFC continues to scope investment opportunities in the areas of infrastructure, distressed assets and offshore medical/education services. With the support of CIDA, IFC has established an advisory services team resident in the region. The advisory services focus in the OECS includes: improving investment climate, facilitating PPPs, tourism, and access to finance. As part of IFC’s crisis response and regional integration strategy, IFC invested US$175 million in two insurance companies that operate across the Caribbean 4 including the OECS (one Trinidad-headquartered and the other Barbados-headquartered). As part of its financial inclusion strategy, IFC is actively working on establishing a credit bureau to serve the OECS. In addition, IFC launched the SME Toolkit in the leading bank in Grenada, helped establish an SME unit and provided trade finance to the leading bank in St. Lucia. Under regional integration and competitiveness, IFC has been actively working to improve the investment climate in the OECS. It is at an early stage of looking at tourism competitiveness in St. Lucia as well as on structuring PPPs in Grenada and St. Lucia. Under the climate change pillar, IFC is engaging with Dominica to provide advisory services for the exploitation of its geothermal resources. 15. Strengthening collaboration with sub-regional organizations and development partners and leveraging significant concessional resources, has supported the successful implementation of the first half of the RPS. The OECS have leveraged highly concessional regional IDA resources significantly increasing borrowing beyond national IDA allocations. The sub-regional institutions, particularly the OECS Secretariat and the Eastern Caribbean Central Bank (ECCB), have been champions in the execution of sub-regional operations, hosting knowledge sharing and capacity building events and facilitating regional policy dialogue and constituency building. The ECCB has been the main counterpart in interventions relating to: access to finance, investment climate, the financial sector and debt management. The OECS Secretariat has taken the lead in the social sectors and on climate resilience. The OECS countries are also benefitting from large regional programs funded by CIDA (approximately CAD 70 million combined) but administered by the Bank, the IFC or World Bank Group-related agencies, such as Entrepreneurship Program for Innovation in the Caribbean (EPIC), focused on private sector development, and administered by infoDev, Private Sector Development Partnership for the English-speaking Caribbean (PSDP) administered by the IFC, and Supporting Economic Management in the Caribbean (SEMCAR), focused on improving public financial management, and implemented jointly by the Bank and the IMF. Pillar One: Building Resilience Results Area 1: Promoting Fiscal and Debt Sustainability 16. OECS Member States have steadily implemented activities aimed at promoting fiscal and debt sustainability and are on track to achieve the RPS outcomes. Through a suite of complementary interventions, the countries have made progress in improving public service delivery, containing the wage bill and strengthening debt management. 17. Debt management functions have been strengthened, through capacity building and technical assistance interventions deployed at a sub-regional level, with a view to improving debt sustainability. During the first half of the RPS period, both Antigua and Barbuda and St. Kitts and Nevis have entered into Stand-by Arrangements with the IMF that included comprehensive public debt restructuring that is critical to the achievement of debt sustainability in these countries. The ECCB continues to lead capacity building efforts on various aspects of debt management including conducting Debt Management Performance Assessments (DeMPAs) and debt sustainability analysis and preparing medium term debt strategies. At the request of the Caribbean countries, the Bank has helped define a comprehensive debt reduction framework for small developing countries, the 4-3-2 Comprehensive Debt and Growth Framework. The Caribbean Development Bank (CDB) and the International Monetary Fund (IMF) have 5 expressed interest in collaborating on disseminating and implementing the framework in interested OECS countries. 18. Significant steps have been taken in enhancing public sector management and the quality of public expenditures. Development policy loans to Grenada and St. Lucia were critical in supporting the Governments’ efforts to contain the economic and social repercussions of the global financial crisis, also helped to stimulate counter-cyclical spending. Grenada, St. Lucia, and Antigua and Barbuda conducted functional reviews and human resource audits in critical ministries as a first step to containing the public sector wage bill. The EGRIP and the SEMCAR programs, focused on reforms in public financial management, tax and customs across the sub-region, will move from the current diagnostic phase and capacity and constituency building interventions to implementing tangible reforms in the outer years of the RPS. Results Area 2: Protecting and Improving Human Capital 19. To position itself to mitigate the effects of the global economic and financial crises, the OECS pursued, as a matter of urgency, interventions aimed at strengthening social protection systems. This has provided a launching pad for informed and coordinated action within the sub-region. The OECS Secretariat led the delivery of technical workshops and seminars where government officials shared experiences and received information on best practices with a view to building consensus on the actions that could be taken at sub-regional and national levels to strengthen social safety nets systems. Simultaneously, social safety nets assessments were conducted in five OECS countries by the Bank, in collaboration with UNICEF and UN Women, and these assessments provided the basis for policy reforms that are being implemented by governments. Excellent progress has been made to rationalize social safety net programs and implement targeting mechanisms in Dominica and Grenada. 20. Slow but steady progress is being made in increasing the proportion of qualified teachers and better skilled post-secondary workers in the OECS. New policy measures for teacher development at the primary and secondary levels have been agreed and are being implemented by the authorities resulting in an increase in the proportion of qualified teachers, with a view to improving the quality of education. The demand-driven technical and vocational training program, financed by the Bank, has supported the establishment of institutions and structures required for training and certification of post-secondary workers. However, training and certification of trainees have been slower than anticipated. 21. Acknowledging that non-communicable diseases (NCDs) are the major cause of death in the sub-region, OECS Member States have taken steps to improve their ability to prevent and manage NCDs. A growing portion of health spending in the OECS is dedicated to managing NCDs and policies and programs could focus more on prevention at a lower cost and for better results. National NCDs strategies by OECS Member States will be informed by analytical work supported by the Bank that identified a variety of policy options. Data on the epidemiology of NCDs in the OECS is limited, so the OECS Secretariat, in collaboration with the Bank, has been supporting interventions to improve the availability and use of data to further inform policy making, as well as to define a set of common regional indicators to monitor NCDs. Dominica and St. Lucia are exploring mechanisms to create incentives for achieving better results in the health sector applying the principles of results-based financing. Results Area 3: Strengthening Climate Resilience 6 22. Good progress has been made in strengthening climate resilience and enhancing the environmental sustainability of OECS countries. The frequency with which the countries experience natural hazards underscores the critical nature of investments in this area. The fact that infrastructure investments made under a series of Bank-financed operations in St. Lucia aimed at disaster vulnerability reduction withstood the passage of Hurricane Tomas evidences the progress made. 23. Good progress is being made towards improving understanding of the vulnerability of critical infrastructure and reducing the number of communities at risk to landslides. An inventory of public buildings and critical infrastructure in Grenada and St. Vincent and the Grenadines has been created as a first step in establishing a database for the conduct of vulnerability assessments. These activities are being supported through an innovative and sizable regional program that leverages grant and highly concessional financing from the Pilot Program for Climate Resilience. Further, thirteen communities in St. Lucia that have benefitted from the implementation of drainage works and guttering to ensure stable slopes for protection against flooding also withstood Hurricane Tomas. 24. Management of priority terrestrial and marine protected areas has improved but slow progress has been made in the establishment of long-term financing mechanism for critical ecosystems. Monitoring and evaluation systems that include biodiversity monitoring at the site level have been established for six OECS protected areas (one in each member state). Initial steps have been taken to establish a Caribbean regional endowment fund (which is expected by June 2012) and national trust funds for the OECS to promote conservation of priority coastal and marine ecosystems, although the effort has suffered delays due to coordination issues and a change in project implementing arrangements. Pillar Two – Enhancing Competitiveness and Stimulating Sustainable Growth Results Area 4: Strengthening Domestic Financial Sectors 25. Steady progress is being made on addressing financial sector vulnerability and strengthening the regulatory and supervisory framework for the financial sector; however, the complexity of the issues and the high level of regional coordination required make progress slow. The Economic and Social DPLs supported actions aimed at improving the regulatory environment for the insurance sector in Grenada and St. Lucia, through the implementation of national insurance legislation. Although the orderly resolution of CLICO Barbados and BAICO (two regional insurance giants that collapsed in the aftermath of the financial crisis in late 2009) has been slow, significant progress has been achieved with the support of the Bank’s technical assistance, including sale of the property portfolio, completed in May 2010; reduction of BAICO’s liabilities through the sale of non-OECS subsidiaries by the Judicial Managers; development of a plan for the sale of the traditional portfolio of BAICO, endorsed by the OECS Government and CARICOM in early 2011; launch of the Health Insurance Support Fund in May 2011; systemic risk assessment of CLICO and BAICO; and the preparation of an issues paper on the restructuring of the OECS insurance industry. With regard to insurance regulation and supervision, ECCU Monetary Council has endorsed recommendation of the Core Committee on Insurance to establish a single regional insurance supervisor and the elaboration of its structure is in progress. The OECS Member States have established a task force, led by the ECCB, to prepare a strategy to strengthen the bank resolution framework, 7 restructure and consolidate the domestic banking sector and strengthen the framework for prudential supervision of banks. The CDB, the IMF and the Bank are members of the task force. The Bank’s technical assistance on the financial sector is being financed in part through the support of UK Department for International Development (DFID). 26. Progress, albeit slow, is being made on the establishment of a sub-regional credit bureau as a means to increase private sector access to capital. The ECCB, with the support of the IFC, has begun elaborating draft legislation to facilitate establishment and operation of the credit bureau and engaging financial institutions to enlist their participation in the bureau. Results Area 5: Improving Access to Quality Services for a more Competitive Business Environment 27. OECS countries have taken concrete steps to improve their business environments through regulatory reforms that increase legal certainty and streamline administrative processes, however progress towards defined outcomes has been slow. The reforms focused on simplifying procedures for starting a business and trading across borders, supported by the IFC investment climate advisory services, are being implemented in parallel across the OECS in order to generate regional synergies and improve conditions for regional integration. Progress has been slow as the OECS face serious capacity constraints in legal drafting and the approval process for legislation and regulations is lengthy. Despite these constraints, draft bills and regulations have been prepared to implement business entry reforms and to regulate electronic transactions. 28. The OECS countries have sharpened their focus on leveraging private sector capital and expertise to achieve public policy objectives; in this regard, the IFC is supporting the identification, design and implementation of related projects. On the transaction implementation front, IFC is currently supporting Grenada in structuring and executing a PPP for its general hospital. Dominica is negotiating a Memorandum of Understanding with the IFC to develop the island’s geothermal energy resources. This agreement contemplates a first phase to complete the necessary studies on the geothermal reserves, which, if confirmed, may lead to a second phase for the structuring of a PPP transaction. This will aid Dominica and potentially the broader OECS to reduce external vulnerability through diversification of energy sources away from fossil fuels. 29. Slow progress has been made on the establishment of a regional electricity regulator which was delayed due to deterioration in the political consensus. The Bank has successfully advocated for grant resources through the SIDS DOCK partnership (a joint initiative of the Alliance of Small Island States, UNDP and the Bank, launched with a pledge from the Government of Denmark) to lower the cost of establishment of the regulator by the OECS and secure participation of other interested countries. 30. Convinced of the importance of ICT as an enabler of growth, diversification, integration and competitiveness more broadly, OECS countries have taken steps to improve the access and quality of telecommunications and internet services. The sub-region has more than doubled the general population’s access to ICT services as compared with 2005, with the financing and technical assistance of the Bank deployed through regional ICT programs. 8 B. Analyzing Portfolio Performance and Implementation 31. Portfolio performance has deteriorated slightly during the first half of the RPS period. Most indicators remained steady during the implementation period. However, total commitments at risk increased from 7.3% in June 2010 to 29.2% in February 2012. The large increase is due to the reduction in total number of projects from 16 to 12, while the number of projects at risk increased from two to four. The four projects currently at risk are: Grenada Public Sector Modernization TAC (P082392); Grenada Technical Assistance Credit (P101322); OECS (St. Lucia) Skills for Inclusive Growth (P097141); and St. Lucia Hurricane Tomas ERL (P125205). The disbursement rate has remained steady at about 20%. Current projections for close of FY12 keep the disbursement ratio at 19.6%. The average delay in effectiveness has improved significantly from 16.9 months in July 2009 to 8.1 months in January 2012, lower than the LCR average of 13.5 months. Most projects receive extensions, and some more than once, especially in the case of regional projects, which are extended by an average of 22 months. As a result of recurring extensions, the average project age for OECS projects is higher than the Caribbean region and LCR averages. Two projects out of the twelve operations in the OECS portfolio have moderately unsatisfactory ratings for progress towards the achievement of project development objectives. The last Country Portfolio Performance Review focused on effectiveness delays and the slow pace of implementation which leads to project extensions. Governments agreed to identify strong champions for the project early and take steps to try to maintain them throughout project preparation and implementation. The Bank committed to intensify project implementation support and provide opportunities for capacity building. Going forward, these issues will continue to be closely monitored. IV. ADJUSTMENTS TO THE RPS 32. While all aspects of the Strategy remain relevant, there have been a number of adjustments to the program occasioned by: changes in timing and financing of the operations, the introduction of emergency operations, a new lending operation to support a newly engaging client and provision for the outer years, the exercise of selectivity due to Bank resource constraints and the introduction of additional knowledge and technical assistance interventions due to strong client demand. The results matrix has been modified accordingly, by refining the outcomes and indicators, introducing new indicators where necessary and revising target dates. Appendix 2, 3, and 4 present summaries of the actual and indicative lending, trust funds and AAA programs under the RPS. Appendix 5 presents the actual and indicative lending volumes. 33. The strategic objectives, the sub-regional/multi-country approach and the five results areas of the Strategy remain valid and the Bank’s mode of engagement appropriate. In fact, as the countries have been buffeted by exogenous shocks, the relevance of the Bank Group’s planned interventions has been underscored. The Bank’s mode of engagement has been to share knowledge and build constituency at a sub-regional level through analytical work and technical assistance and to follow with lending upon client demand. This mode of engagement is slower and more deliberate but it creates greater ownership and, in the process, encourages sub- regional action fostering better integration. It has been well received by the OECS countries and sub-regional institutions. The Bank has successfully consolidated its OECS portfolio; focusing on preparing larger lending operations and replicating those across a number of countries to maximize development impact and improve cost-effectiveness of Bank services by spreading the 9 fixed cost of preparing and monitoring programs. These large multi-country projects are inherently more time-consuming to prepare and riskier to implement, but the Bank has experience and a comparative advantage in this relative to other donors. The Bank is convinced of the indispensability of this approach for countries grappling with deepening integration and will continue on this course. 34. The investment projects and development policy loans programmed in the RPS continue to feature in the lending program, albeit with adjustments in timing and level of financing. Most of the lending operations proposed in the Strategy, with the exception of the OECS Financial Sector Strengthening and Regulation Project and the OECS Education Sector SWAp were or will be delivered. Regarding the Financial Sector Project which was envisioned as a US$6 million technical assistance project, the discussions aimed at reaching consensus for borrowing among the six countries were protracted. Rather than awaiting clarity on the issues surrounding the preparation of a lending project, the Bank responded swiftly; deploying technical assistance financed through grant resources, complemented by financing from DFID and its own resources to support technical assistance for financial sector resolution. The Education Sector SWAps will not be processed in FY12 as proposed; insufficient progress has been made in the elaboration of the national education sector strategies that would form the basis for Bank support to the sector. The Bank continues to pursue technical assistance and knowledge sharing to support the preparation of national and regional education sector strategies. To ensure effective use of IDA and to leverage additional highly concessional financing from the Pilot Program for Climate Resilience, the first phase of the OECS Regional Disaster Vulnerability Reduction Program (RDVRP) (comprising Grenada and St. Vincent and the Grenadines) was advanced to FY11. The second phase comprising St. Lucia and Dominica is scheduled to go to the Board in FY13. The Bank successfully leveraged national and regional allocations and PPCR grant and highly concessional resources, making the RDVRP projects the largest within each of the national portfolios. At the request of the St. Lucian and Vincentian authorities, the Bank team rapidly prepared US$20 million in Emergency Loans from IDA resources to support recovery and reconstruction efforts post-Hurricane Tomas. A project concept note for a Global Environment Fund (GEF) Sustainable Land Use Planning and Management Project will be presented to the GEF in June 2012. The GEF/Adaptation Fund Climate Resilience Energy Provision has been dropped from the RPS. 35. Due to the challenges of coordination and complexity of multi-country operations, there have been delays in concluding project preparation for certain sub-regional/multi- country operations. Negotiations of the OECS Regional Energy Regulator Program were delayed by one year due to challenges in maintaining broad political consensus for the creation of this regional institution. Acknowledging the anticipated benefits of a regional energy regulator for the OECS, three interested countries, Grenada, St. Lucia and Antigua and Barbuda agreed to proceed with the establishment of same in FY11. The Caribbean Regional Communications Infrastructure Program is now scheduled to go to the Board in FY12 and will include Grenada, St. Lucia and St. Vincent and the Grenadines as well as the Dominican Republic. 36. The Bank program has been augmented to include the first lending operation to Antigua and Barbuda to support the government’s efforts to transform its public sector and strengthen its social protection system. This loan, scheduled to go to the Board in FY13, is a follow-on to a grant that focused on enhancing the efficiency of public expenditures. During the first half of the RPS, Antigua and Barbuda engaged the Bank and other international financial 10 institutions (the IMF and the CDB) and sought assistance in executing its strategic response to the global financial and economic crises, the National Economic and Social Transformation Plan. The authorities successfully implemented the first year of a very stringent IMF Stand-by Arrangement, however, disbursements under the IMF program have stalled until a sustainable plan is articulated to resolve ABI Bank that was intervened by the ECCB in July 2011. 37. Bank resource constraints required a high degree of selectivity in determining which interventions would be pursued. The selections were carried out based on expressed priorities. Internal resource constraints have affected planned analytical work and technical assistance more than lending. The analytical work that focuses on Renewable Energy and Island Interconnection was not initiated in FY11; however, discussions ensue as to the scope and financing for this work in future. The OECS PER, Debt Reduction and Public Sector NLTA and the Investment Climate Assessments, proposed for FY11 and FY12, respectively were dropped. 38. In response to strong client demand, the Bank and the IFC are providing technical assistance in key strategic areas to support the implementation of the OECS Economic Union, in close collaboration with sub-regional institutions. As part of a broader regional effort to stimulate sustainable growth in the Caribbean through informed and more inclusive dialogue, the Bank has initiated the Caribbean Growth Forum, in collaboration with the IDB, DFID and CIDA. Further, the Bank and IFC are contributing members to the ECCU Task Force for Growth and Development, along with other development partners such as the IMF and CDB. The Task Force is convened by the ECCB, and its objective is to analyze and recommend actions aimed at addressing the constraints to growth in light of the high debt levels that exist in the OECS. To help address the dearth of reliable and comprehensive social statistics, the Bank initiated activities in FY10 on an OECS Regional Statistics NLTA as a complement to the existing Trust Fund for Statistical Capacity Building (TFSCB) grant being implemented by the Secretariat to improve the compilation, analysis and dissemination of social statistics. Additional resources have been leveraged to broaden this work, and to support the OECS Secretariat in the preparation of an OECS Development Strategy and the establishment of a mechanism for monitoring and evaluating the progress of Economic Union implementation. 39. The FY2010-2014 RPS results framework has been revised to reflect adjustments in analytical work programs and implementation progress. RPS outcomes were refined in a few instances to reflect progress of implementation and the state of activities under implementation. For example, the outcome relating to the establishment of the electricity regulator has been scaled back to preparation of the draft treaty to enact the institution in view of delays. The outcome relating to strengthening the financial sector, now reflects both the need to restore financial sector stability and strengthen the regulatory and supervisory framework. Some indicators have been modified to account for changes in the timing of new projects, progress in program implementation and policy changes that invalidate existing indicators. For example, given delays in the implementation of OECS Skills for Inclusive Growth Projects, the indicator has been changed from percentage of trained youth employed to number of youths trained. The indicator on reduced debt levels as a proxy for improved debt management function has changed to the preparation of debt management strategies by multiple countries. While debt levels relative to GDP have reduced significantly, this is due to the GDP rebasing exercise undertaken by all OECS countries and would not be appropriately correlated with the countries’ efforts to strengthen the debt management function. In other cases, indicators have remained substantively 11 the same and target values or dates for achievement of targets have been adjusted to reflect implementation progress, or to text refined to better reflect the actual activities on the ground. V. LOOKING AHEAD 40. Going forward the Bank Group’s engagement will remain focused on addressing the increasing vulnerabilities that confront the OECS through structural reforms supported by development policy lending. As the policy agenda is still uncertain, a high degree of flexibility in defining the Bank’s future program is required to respond to changing circumstances and client demand. Rising debt levels, financial sector instability, high vulnerability to weather events and other exogenous shocks and sluggish growth place the sub- region at extreme risk, particularly if a double dip recession materializes, due to very tight fiscal space and limited room to increase public debt. The policy dialogue around these challenges has intensified over the RPS period, but this dialogue has not matured to the level required to clearly outline the future program. 41. It is anticipated that the Bank will rely more heavily on development policy and results–based lending instruments rather than investment loans to support key structural reforms and complement the substantial program of technical assistance that has been undertaken in the early part of the RPS period. The Bank will continue to seek out opportunities to lead with knowledge and technical assistance to define appropriate responses to existing and emerging challenges. Ongoing knowledge and technical assistance interventions across the program are reflected at Appendix 4. The Bank’s technical assistance in support of financial sector stability is ongoing. It is anticipated that development policy loans will follow to support policy reforms contributing to financial sector stability and/or the implementation of the 4-3-2 Comprehensive Growth and Debt Framework, and dialogue has commenced with the countries to this effect. The Framework is an outcome of analytical work initiated by the Bank in FY11 at the request of Caribbean countries. IT focuses on the following four pillars: i) private sector development; ii) fiscal sustainability; iii) debt sustainability; and iv) climate change resilience. The Framework has been discussed with the IMF and the CDB; both have expressed interest in partnering in its implementation in interested countries. Like Antigua and Barbuda, St. Kitts and Nevis has requested Bank support to advance the governments’ efforts in public sector modernization and strengthening social safety nets. If there is interest from the countries and conditions are conducive for lending, results-based lending may be utilized. The volume of lending for each operation reflected in Appendix 5 is indicative only. Table 1 below reflects the indicative and remaining IDA allocations under IDA 16 which coincides with the end of the RPS period. Actual IDA allocations will depend on: (a) the countries’ performance; (b) their performance relative to that of other IDA recipients; (c) the total resources available to IDA; (d) changes in the list of active IDA-eligible countries; (e) the terms of financial assistance provided (grants or loans); and (f) the amount of compensatory resources received for the Multilateral Debt Relief Initiative. Additionally, the indicative IBRD lending program is up to a maximum of $20 million for each OECS country for the period of the RPS (FY10-14). The actual volume of IBRD lending will depend on country creditworthiness, IBRD’s lending capacity during the period of the RPS, and exposure management parameters. 12 Table 1: Indicative and remaining IDA 16 allocations Indicative Remaining Remaining IDA 16 (SDR) IDA 16 (SDR) IDA 16 (US$) Dominica 11.6 11.6 17.4 Grenada 11.6 6.7 10.1 St. Lucia 14.7 13.0 19.5 St. Vincent and the Grenadines 12.7 10.8 16.2 Total 50.6 42.1 63.2 42. IFC advisory services will continue to provide support to: improve the investment climate in the OECS; improve the tourism strategy; focus on competitiveness and access to finance; and facilitate private sector involvement in PPPs. IFC is aiming at improving the investment strategy for industry competitiveness, particularly in the tourism industry, by: identifying competitive advantages to be exploited by countries; facilitating access to SMEs to make the most of the cruising industry, reducing transactions costs through trade facilitation and fostering dialogue between governments and the private sector to identify issues constraining competitiveness. Technical assistance by the Bank targeted at addressing the vulnerabilities facing the financial sector and strengthening the regulatory environment will pave the way for the IFC will explore options to crowd in private sector participation to help strengthen the financial sector in the OECS. In this regard, the IFC will explore potential structures that could be implemented for distressed assets and potential opportunities for the involvement of its insurance partners. In addition, IFC could provide trade finance and micro, small and medium enterprise (MSME) services (investment and advisory) as well as advisory services to enhance risk management and corporate governance within the financial sector. 43. The World Bank Group will seek opportunities to strengthen its collaboration with other development partners to maximize development impact and reduce clients’ transaction costs. The World Bank Group’s partnership with CIDA is particularly noteworthy as the Bank is administering approximately CAD 70 million in trust fund resources to implement the SEMCAR, EPIC and PSDP programs, three Caribbean regional programs focused on private sector development and public financial management. The Bank has also leveraged resources from DFID to provide technical support to the financial sector resolution process. VI. RISKS 44. The risks highlighted in the RPS remain and have materialized to varying degrees during the first half of the RPS period. The Bank’s program continues to support mitigation efforts. However, where the correlated risks identified simultaneously impact upon an outcome, as is the case with restoring financial sector stability in the OECS, mitigation is challenging and achievement of the outcome is significantly jeopardized. 45. Exogenous shocks and fiscal slippage. During the first half of the period of the RPS, the OECS have been impacted by: weather–related events necessitating unforeseen public spending; swing in international prices of commodity imports; protracted recovery from the global crisis. These risks are difficult to mitigate, but the Bank’s program with its focus on climate resilience, 13 fiscal prudence and economic diversification through support for critical industries including tourism, helps to manage these risks. 46. Debt. Public debt has surged as a consequence of the global downturn. This risk is exceedingly difficult to mitigate but the Bank’s program is supporting governments’ efforts to reduce debt to sustainable levels or place it on a declining path, by improving debt management capacity among other things. 47. Political will. Varying levels of national ownership of regional reform agendas have led to delays in the implementation of a number of initiatives demanding a high level of regional coordination. To mitigate this risk, the Bank has continued: to engage in country dialogue and capacity building to ensure that clients have sufficient information to facilitate decision making; to empower regional change agents uniquely placed to move the reform agenda; and to strengthen coordination among developing partners to ensure coherence in approaches and consistency in advice. 48. Financial Sector. Liquidity risk, government exposures of some indigenous banks, and a deterioration of the private sector loan quality raise concerns about the vulnerability of the banking system. The collapse in 2009 of insurance sector giants exposed weaknesses in the region’s regulatory framework for non-banks and highlighted the risk of spillovers both across countries and between non-banks and the banking sector. The Bank, the IMF and the CDB are collaborating with the OECS Member States in the design and implementation of a regional resolution strategy and the strengthening of regulations and supervision of the financial sector over the medium term. IFC will begin sounding out private sector interest and provide technical assistance to the OECS governments as they carry out the upstream work aimed at achieving financial sector stability. 49. Implementation capacity. The problem of finding and maintaining critical personnel for project implementation persists and is difficult to mitigate as it is inherent in small states. However, the Bank actively encourages training and capacity building efforts and intensive implementation support to help mitigate this risk. 14 Appendix 1: Results Matrix for the RPS FY10-FY14 Revised RPS Outcome Progress Towards RPS Original RPS Outcome Planned Milestones World Bank Assistance (If applicable) Outcomes Pillar One: Building Resilience Result Area 1: Promote Fiscal and Debt Sustainability  Debt management functions  Comprehensive debt reduction Indicator on debt management Lending: strengthened framework has been implemented functions: GD is expected to  Debt Sustainability Programmatic DPLs Indicator: Reduced debt levels Indicator: Debt management in at least 3 countries by end-2012 prepare a debt strategy under the – FY13/14 (debt/GDP ratio) in all countries strategy in at least 3 countries by 4-3-2 framework by 2012. SKN is  Public and Social Sector Baseline: Average 105.35% 2014 expected to draft a debt strategy Transformation (AB) – FY13 (end-2009) after the 2012 debt restructuring.  Economic and Social DPLs (GD, SLU) Target: Average 90% (2014) SVG has a debt strategy that – FY10 could be improved.  OECS EGRIP (SVG) – FY10  OECS EGRIP – FY08  Fiscally sustainable wage bill  Recommendations from Indicator on public sector wage  GD TAC (FY08) and Public Sector ensuring key public services functional reviews and human bill: AB 7.9; DM 10.6; GD 9.0; Management TAC (FY06) coverage resource audits are implemented to SKN 12.3; SLU 12.6; SVG 11.9  DM Growth and Social Protection TAC Indicator: Public service wage bill contain wage bill growth in at least (2010) – FY07 reduced in the OECS (3 countries) 3 countries by end-2012 Baseline (2008/9):AB 9.8; DM Non-lending: 12.2; GD 13.0; SKN 14.96;  Efficiency in public spending (SKN) SLU 10.6; SVG 12.9 IDF– FY12 Target: < Baseline  Fiscal and Debt Sustainability NLTA (including supporting DeMPAs for  Improved government services  Outcome-oriented regionally Indicator on e-government remaining countries) – FY12 across the region through the focused e-government services: Minor e-government services delivered and major ones  OECS Growth and Development implementation of regionally implementation plan for OECS on track. Strategy NLTA – FY12 integrated e-government services published  ECCB Debt and Growth TA – FY12 Indicator: Number of major new Baseline: 0 (2010)  Caribbean Growth Forum AAA – FY12 e-government services offered Target: 1 (2012) Baseline: 0 (2009)  OECS MTDS TA support to ECCB – Target: 4 (2014) FY12  Crisis Resilience RSR TF – FY12  Greater linkage between public  Capacity of governments for Indicator on efficiency of public  Strengthening PFM, Tax and Customs expenditures and development undertaking M&E of key programs expenditures: An M&E unit has (Caribbean-wide) – SEMCAR TF – FY11 objectives and policies is strengthened been established in Grenada.  Framework Solution for Caribbean Indicator: Integration of Indicator: Establish regular Indicator: Existence of M&E Interest in dissemination of Debt Restructuring AAA – FY11 performance information from reporting mechanism that Action Plans in at least 3 countries performance information is  Efficiency in public spending (AB, GD, M&E mechanisms into the budget contains performance information by end-2012 increasing. SLU) IDF – FY10 process in at least 3 countries by of selected government programs  Institutionalizing M&E in the OECS 2014 in at least 3 countries by 2014 (CARICAD) IDF – FY10  DeMPA (AB, GD, SKN) – FY10 15 Revised RPS Outcome Progress Towards RPS Original RPS Outcome Planned Milestones World Bank Assistance (If applicable) Outcomes Pillar One: Building Resilience Results Area 2: Protect and Improve Human Capital  Rationalized social safety net  Number of countries with Indicator on targeting Lending: systems assessments of social assistance instruments: 3 (2012).  Public and Social Sector Indicator: Countries using Indicator: Countries using programs including Transformation (AB) – FY13 objective, transparent and objective, transparent and recommendations for improvement  Strengthening Social Safety Nets documented targeting instruments documented targeting instruments in targeting SWAp (GD)– FY12 in cash transfer programs in cash transfer programs Baseline: 1 (2009)  Education Sector (GD, SLU, SKN, Baseline: 0 (2010) Baseline: 0 (2010) Target: 6 (beginning 2011) SVG) SWAp – FY12 Target: 6 (2014) Target: 3 (2014)  Economic and Social DPLs (GD, SLU) – FY10  Increase in the proportion of  New policy measures for Indicator on qualified teachers:  IFC investments in private health and qualified teachers at the primary teacher development are agreed Average 60.9% (2010). education and secondary levels (i.e. teachers upon by 2012  DM Growth and Social Protection TAC with teacher training qualification) – FY07 in the OECS (6 countries)  Skills for Inclusive Growth (SLU – Baseline: Average 59% (2009) FY07, GD – FY09) Target: Average 62% (2014) Education Development Project (GD – FY09, SVG – FY03)  Better skilled post-secondary  Number of Caribbean Indicator on youth enrolled in workers in the labor force Vocational Qualifications training programs: GD: 171 Non Lending: Indicator: % of youth enrolled in Indicator: Cumulative number of certifications awarded (2012); SLU: 299 (2012)  Results Based Financing in Health the training scheme employed 15 youth enrolled in training Baseline: 0 (SLU, 2007); 0 (DM, SLU) RBF – FY12 months after the start of their programs at level 1 or higher (GD, 2009)  Build Capacity Through Knowledge training Baseline: 0 (GD, 2009); Target: 1265 (SLU, 2012); Exchange on CCTs SSF (DM, GD, SLU) – Baseline : 0 (SLU, 2007); 0 0 (SLU, 2007) 895 (GD, 2013) FY12 (GD, 2009) Target: 500 (GD, 2013); 870 (SLU, 2013)  Health Policy ESW (Caribbean-wide) – Target: 75% (SLU, 2012); FY11 Education Sector (OECS) NLTA – 65% (GD, 2013) FY11  Improving Human Development Data  Improved knowledge and  A policy note on OECS Health Indicator on policy note: Representatives of all six OECS (OECS) IDF – FY11 information on the sub-region’s published by mid-2012 countries participated in a  Statistical Capacity Building (OECS) chronic non-communicable regional NCD policy note NLTA – FY10 diseases dissemination workshop in  Social Protection (OECS) NLTA– Indicator: Policy note on OECS September 2011. FY10 Health disseminated in at least 3 countries by 2014  Teachers Career Path (OECS) ESW – FY10  Making Youth at Risk Interventions Gender Sensitive (Caribbean-wide) BNPP – FY10  IFC advisory services in PPPs 16 Revised RPS Outcome Progress Towards RPS Original RPS Outcome Planned Milestones World Bank Assistance (If applicable) Outcomes Pillar One: Building Resilience Results Area 3: Strengthen Climate Resilience  Improved understanding of  Development of exposure Indicator on understanding of Lending: vulnerability of critical databases for critical public vulnerability of critical  Disaster Vulnerability Reduction infrastructure infrastructure initiated infrastructure: Inventory of Project – DVRP (Phase 2: DM, SLU) Indicator: Vulnerability Indicator: Database of public Baseline: 0 (end 2009) public buildings and critical – FY13 assessments/functions buildings established Target: in at least 2 countries infrastructure in GD and SVG  Pilot Program for Climate Resilience – Baseline: Have been carried Baseline: 0 (2010) (2011) completed, including exposure PPCR (Phase 2: DM, SLU) – FY13 out for some buildings (2009) Target: 2 (2014) data mapped to building  DVRP (Phase 1: GD, SVG) – FY11 Target: Calculated for all footprints.  PPCR (Phase 1: GD, SVG) – FY11 public buildings in at least 2  Hurricane Tomas ERL (SLU, SVG) – sectors in at least 2 countries FY11 (2014)  SLU Disaster Management- FY09  Number of people at high risk  Reduced number of  Drainage works and guttering Indicator on high risk of Non-Lending: of landslides in SLU communities at high risk of finalized in 4 communities in SLU landslides in SLU: 13 (2012).  PPCR (Phase 2: DM, SLU) – FY13 Baseline: Population of 4 landslides in SLU (2012)  SSF Regional Disaster Vulnerability named communities in SLU Indicator: Communities and Climate Risk Reduction Program (2009) benefiting from landslide (Caribbean-wide) – FY12 Target: 0 people living at high prevention interventions in SLU  Sustainable Financing of Marine Areas risk to landslides in SLU Baseline: 0 (2009) (OECS) – FY12 (2012) Target: 12 (2012)  PPCR (Phase 1: GD, SVG) – FY11  Small Farmers Vulnerability Reduction  Improved management of the  Completion and approval of Indicator on M&E system: M&E system established (2012). Initiative (GD) JSDF – FY11 priority terrestrial and marine management plans in all 6 OPAAL  Agriculture Risk Management (GD) protected areas sites by end 2010 NLTA – FY10 IFC – Private sector Indicator: M&E system benchmarks in environmental standards established to monitor species and related ecosystems under the 6  OECS Protected Areas and Associated OPAAL sites by 2012 Livelihoods – FY04  Implementation of Adaptation Measures  Long-term financing Indicator on long-term – FY07 mechanisms established for critical financing mechanisms: The ecosystems by 2014 regional endowment fund is to be Indicator: National legislation for established by June 2012. the establishment of country level protected areas trust funds adopted in 4 countries by 2014 17 Revised RPS Outcome Progress Towards RPS Original RPS Outcome Planned Milestones World Bank Assistance (If applicable) Outcomes Pillar Two: Enhancing Competitiveness and Stimulating Sustainable Growth Results Area 4: Strengthen the Domestic Financial Sector  Improved regulatory and  Medium-term resolution  At least 4 countries enacted the Indicator on financial sector Lending: supervisory frameworks for the strategy for the financial sector new insurance law aimed at strategy: Support to elaborate a  Economic and Social DPLs (GD, SLU) insurance sector as evidenced by Indicator: Draft comprehensive strengthening regulatory comprehensive strategy is – FY10 the enforcement of the new strategy for restoring the stability environment by 2012 ongoing in collaboration with the  IFC advisory services and investments insurance law in 4 countries by of the financial sector by 2012 ECCB, the IMF and CDB. in the financial sector 2012  Improved regulatory and Indicator 1: Ministers of Finance Non-lending: supervisory framework for the agreed to establish a single  Restoring Financial Stability in the financial sector regional insurance supervisor and OECS – DFID EFO NLTA – FY12 Indicator 1: Draft of a new the elaboration of its structure is  Caribbean Insurance Crisis NLTA uniform insurance bill in progress. (BAICO/CLICO and FIRST) – FY11  Strengthening supervision of the non- Indicator 2: Action plan to Indicator 2: Draft action plan is banking financial sector IDF – FY10 strengthen banking regulation and being prepared.  Strengthening the Institute of Chartered supervision by 2012 Accountants of the Eastern Caribbean IDF – FY10 Pillar Two: Enhancing Competitiveness and Stimulating Sustainable Growth Result Area 5: Improve Access to Quality Services for a more Competitive Business Environment  Creation of ECERA as the  Draft treaty establishing  Treaty establishing the ECERA Lending: regulator of participating ECERA prepared for 2 countries ratified by participating countries  Caribbean Regional Communications countries’ electricity markets by by 2014. by 2013 Infrastructure Program (GD, SLU, and 2014 SVG) – FY12  OECS Energy Regulator Project (GD  Increased access to ICT  Launch of tenders for the Indicator on ICT access: 17% and SLU) – FY11 services for the general population provision of telecom services to (2012)  IFC advisory services in energy and Indicator: % population with Indicator: % population with government, schools, hospitals and infrastructure (potential) access to broadband Internet access to broadband Internet rural areas by 2011 services services Non-lending: Baseline: 9% (2009) Baseline: 9% (2009)  Support and Expand the Caribbean Target: 20% (2014) Target: 15% (2014) Network of Business Incubators – EPIC (Caribbean-wide) – FY12  PPP’s in relevant sectors to  Required changes in law to be Indicator on PPPs: PPP  Renewable Energy and Island relieve government expenditures enacted by December 2010 in the mandate: was initiated but Interconnection (Caribbean-wide) AAA – and improve service first of the OECS countries to terminated at an advanced stage FY13 Indicator: Number of PPP projects establish a divestment program in A&B; was initiated in  Regional Energy Strategy (Caribbean- undertaken in the region Grenada; is anticipated in St. wide) ESW – FY11 Baseline: 0 (2009) Lucia.  Investment Climate – Doing Business Target: 2 (2014) (OECS) NLTA – FY11  IFC PPP advisory services opportunities  Simplified procedures for  At least 4 reports (assessments, for private sector investment starting a business and trading surveys, manuals) regarding 18 Revised RPS Outcome Progress Towards RPS Original RPS Outcome Planned Milestones World Bank Assistance (If applicable) Outcomes across borders within the OECS by business environment in the 2014 (IFC) Caribbean completed by 2011 Indicator 1: Reduction in the Indicator 1: Business entry Indicator 1: Business entry average number of days it takes to regulations adopted in 4 countries regulations adopted in DM, SKN, comply with business regulation by 2013 and SLU (2012). related to business entry Baseline: DM:14; GD: 20; SKN: 45; SLU: 14 (2009) Target: DM: 8; GD:13; SKN: 26; SLU: 8 (2011) Indicator 2: Reduction in the Indicator 2: Reduction in the number of days to trade number of days to trade - Average number of days to - Average number of days to Indicator 2 (imports): DM: 15; comply with business regulation comply with business GD: 15; SKN: 11; SLU: 18 (Imports) regulation (Imports) (2012) Baseline: DM:15; GD: 19; Baseline: DM:15; GD: 19; SKN: 13; SLU: 18 (2009) SKN: 13; SLU: 18 (2009) Target: DM: 13; GD:17; Target: < Baseline (2014) SKN: 12; SLU: 16 (2011) - Average number of days to Indicator 2 (exports): DM: 13; - Average number of days to comply with business GD: 10; SKN: 12; SLU: 14 comply with business regulation regulation (Exports) (2012) ( Exports) Baseline: DM:13; GD: 14; Baseline: DM:13; GD: 14; SKN: 12; SLU: 14 (2009) SKN: 12; SLU: 14 (2009) Target: < Baseline (2014) Target: DM: 12; GD:12; SKN: 11; SLU: 12 (2011) 19 Appendix 2: Actual and Indicative Lending Program for the RPS FY10 - FY14 RPS Pillars Bank Program FY10 FY11 FY12 FY13 FY14 Building Economic and Social DPLs (GRE, SLU) – P, A Resilience P117000 and P117016 OECS EGRIP Project (SVG APL2) – P117087 P, A Potential Debt Sustainability Programmatic P, D DPLs Strengthening Social Safety Nets P A Project/SWAp – P123128 OECS Education Sector SWAp P,D OECS Disaster Vulnerability Reduction A P Project(Phase 1-GRE, SVG) –P117871 OECS Disaster Vulnerability Reduction P R Project (Phase 2 - SLU) – P127226 OECS Disaster Vulnerability Reduction Project (Phase 3 - DOM) – P129992 Antigua and Barbuda Public and Social Sector New Transformation Project - P126791 Potential 4.3.2 Framework /Financial Sector New New Programmatic DPLs Enhancing OECS Regional Energy Regulator Project – P A Competitiveness P101414 and Stimulating OECS Financial Sector Strengthening and P, D Sustainable Regulation Project – P123925 Growth Caribbean Regional Communications P R Infrastructure Program - P114963 Note: Relevant FY is date to Board P: Proposed in RPS; A: Actual; D: Dropped; R: Revised projection; New: Not in RPS 20 Appendix 3: Actual and Indicative Trust Funds/Grants Program for the RPS FY10-FY14 RPS Pillars Bank Program FY10 FY11 FY12 FY13 FY14 Building Multi-Donor Trust Fund for strengthening P A Resilience PFM, Tax and Customs (CIDA’s SEMCAR initiative, implemented by the Bank and IMF, Caribbean-wide) – P123665 IDF Grant to promote efficiency in public P, A spending (A&B, GRE, and SLU) (SKN) – A P120474, P117873, P116859, P129786 IDF Institutionalizing M&E in the OECS P, A (CARICAD) – P117829 IDF Grant to promote capacity building for P, A evidence-based policymaking in education and health sectors (In RPS as Improving Human Development Data) – P122518 GEF Sustainable Land Use Planning and R Management – P073267 GEF/Adaptation Fund Climate Resilient P, D Energy Provision GEF Sustainable Financing of Marine Areas – P A P103470 Pilot Program for Climate Resilience (Phase 1- A P GRE and SVG) - P117330 Pilot Program for Climate Resilience (Phase 2 P R - DOM and SLU) - P117330 BNPP Making Youth at Risk Interventions P, A Gender Sensitive (Caribbean-wide) – P121903 SSF Build Capacity Through Knowledge New Exchange on CCTs (DOM, GRE, and SLU) – P126753 SSF Regional Disaster Vulnerability and New Climate Risk Reduction Program – P117871 EPIC Caribbean – Support and Expand P A Caribbean Network of Business Incubators – P128038 Results Based Financing in Health (DOM, New SLU) P125100 JSDF Small Farmers Vulnerability Reduction New Initiative (GRE) – P124107 RSR Trust Fund for Crisis Resilience New (supporting the preparation of the OECS Development Strategy and the M&E system for the OECS) – P128524 Enhancing IDF Strengthening Accountability of the non- P,A Competitiveness Banking Financial Sector – P119913 and Stimulating FIRST Strengthening Insurance Regulation and P A Sustainable Supervision – P121613 Growth IDF Strengthening the Institute of Chartered P, A Accountants of the Eastern Caribbean – P119818 Note: Relevant FY is date to Board P: Proposed in RPS; A: Actual; D: Dropped; R: Revised projection; New: Not in RPS 21 Appendix 4: Actual and Indicative AAA (ESW + TA) Program for the RPS FY10-FY14 RPS Pillars Bank Program FY10 FY11 FY12 FY13 FY14 Building Framework Solution for Caribbean Debt P A Resilience Restructuring AAA DeMPAs (A&B, GRE, and SKN) P, A Fiscal and Debt Sustainability NLTA P,A (including supporting DeMPAs for remaining countries) OECS PER, Debt Reduction and Public D Sector NLTA OECS Education Sector NLTA – P, A P121221 OECS Health ESW – ―The Growing P, A Burden of Non-Communicable Diseases in the Eastern Caribbean‖ - P118237 Social Protection NLTA (OECS) P, A OECS Teachers Career Path ESW – P, A ―Attracting and Retaining Qualified Teachers‖ - P111783 Agriculture Risk Management NLTA P, A (GRE) – P117601 Renewable Energy and Island P R Interconnection AAA - OECS MTDS TA support to ECCB - New Regional Statistical work in OECS New (NLTA) – P128524 OECS Growth and Development Strategy New – P127336 ECCB Debt and Growth TA support New Caribbean Growth Forum AAA – New P130208 Enhancing Caribbean Insurance Crisis (name in RPS P, A Competitiveness - BAICO/CLICO Resolution NLTA) and Stimulating Restoring Financial Sector Stability – A Sustainable P121613 Growth Regional Energy Strategy ESW – P A ―Caribbean Regional Electricity Generation, Interconnection and Fuel Supply Strategy‖ (Caribbean-wide) – P112173 Investment Climate in the Caribbean P, A (Doing Business follow-up) NLTA (OECS) – P121613 Public Private Partnership: ―Strategies D and How To‖ (IFC) Investment Climate Assessment AAA D (A&B, DOM, GRE, and SKN) Note: Relevant FY is date to Board P: Proposed in RPS; A: Actual; D: Dropped; R: Revised projection; New: Not in RPS 22 Appendix 5: Actual and Indicative Lending Volumes for RPS FY10-FY14 Fiscal RPS Pillars* IBRD/IDA Lending Commitment year in millions (US$) FY10 Pillar 1 Economic and Social DPLs Grenada – P117000 8.0 St. Lucia – P117016 12.0 OECS EGRIP Project (St. Vincent and Grenadines APL2) – P117087 2.4 FY10 Total 22.4 FY11 Pillar1 OECS Disaster Vulnerability Reduction Project (APL1) *- P117871 Grenada 18.2 St. Vincent and the Grenadines 13.92 Hurricane Tomas Emergency Recovery Loans St. Lucia – P125205 5.0 St. Vincent and the Grenadines – P124939 15.0 Pillar 2 OECS Regional Energy Regulator Project – P101414 Grenada 2.8 St. Lucia 2.8 FY11 Total 57.7 FY12 Pillar1 Grenada Strengthening Social Safety Nets Project – P123128 5.0 Antigua and Barbuda Public and Social Sector Transformation Project 20.0 Pillar 2 Regional Communications Infrastructure Program (OECS IDA Blend)* Grenada 10.0 St. Lucia 6.0 St. Vincent and the Grenadines 6.0 FY12 Total 47 FY13 Pillar 1 OECS Disaster Vulnerability Reduction Project (APL2)*- Dominica 20.0 St. Lucia 10.0 Potential 4.3.2 Framework /Financial Sector Programmatic DPLs **undefined FY13 Total 30.0 FY14 Pillar 1 Potential 4.3.2 Framework /Financial Sector Programmatic DPLs **undefined FY14 Total FY10-14 Total 157.1 Pillar 1 – Building Resilience and Pillar 2 – Enhancing Competitiveness and Stimulating Sustainable Growth *IDA amounts include national and regional IDA allocations 23 STANDARD CAS ANNEXES ANTIGUA AND BARBUDA Annex 1: Country Profile Population: 81,799 (Preliminary results of national census 2012) GNI per capita: US$16,284 (2011 World Economic Outlook) 1. Profile. Antigua and Barbuda (A&B) is a three-island economy (Redonda is the third) which accounts for about 25 percent of the combined Eastern Caribbean Currency Union’s GDP. Antigua, the largest island, has a dry climate and a large number of white-sand beaches. The cultivation of sugar that started in the late 1600’s was abandoned in 1969. Aside from tourism— the island’s most important industry—A&B’s economy depends heavily on the service sector, particularly offshore services. According to the Caribbean Development Bank’s Country Poverty Assessment, A&B has a poverty rate of 18.3 percent and an unemployment rate of 4 percent in 2005/2006. Social indicators do not reflect A&B’s high per capita income. Adult literacy attainment, for example, lags compared to the other OECS countries. The 2011 UNDP Human Development Index ranks Antigua 60th, out of 187 countries. 2. Political Context. Independence: 1981 Last election: 2009. In March 2009, the United Progressive Party was reelected, winning 10 of the 17 available seats. 3. Economic Developments and Prospects. Antigua and Barbuda (A&B) experienced its worst recession in a decade, contracting by 10.3 percent in 2009 and 8.9 percent in 2010, due to decreases in tourism, manufacturing, and FDI-funded construction. The contraction of economic activity resulted in a significant slowdown in private sector credit growth. Economic growth is expected to stagnate in 2011, amid lower than expected resumption of high-end tourism projects. Nonetheless, the medium-term outlook on growth remains critically dependent on the demand for tourism. 4. Fiscal stance, debt and inflation. The fiscal situation remained fragile in 2011 despite significant improvements in 2010 amid decisive fiscal reforms, such as the broadening of the base of the Sales tax (VAT), the modification of the import duties and the introduction of an excise tax on alcoholic beverages and tobacco. The wide overall fiscal deficit of 17.5 percent of GDP in 2009, fell to -0.3 percent in 2010. Yet it is expected to have broadened to -1.7 percent in 2011 amid depressed economic activity. Nonetheless the primary balance which improved by 12 percentage points to a positive 1.7 percent of GDP in 2010, remained positive at 1.4 percent of GDP in 2011. By 2012, the overall balance is expected to turn slightly negative to - 0.5 percent of GDP, through improved tax administration and further efficiencies on the expenditure side of the budget, including a 10 percent reduction in the government’s wage bill by 2012 relative to its 2010 levels. These are extraordinary achievements which were recognized in Spring Meetings with the A&B government and the World Bank team. However, A&B restructured a significant share of public debt held by Paris Club and domestic creditors and this has contributed to the achievement of the overall balance target and reduced public debt from 101.8 percent in 2009 to 89.4 percent in 2010 and further to 89.1 percent in 2011. Inflation has increased amid a jump in food and fuel prices. In 2009 and 2010, food prices rose by 8.8 percent and 7.9 percent y-o-y, pushing inflation upwards from 2.4 percent to 2.9 percent, in 2010. Pressures increased in 2011, 24 with headline inflation materializing at 3.9 percent for the year. CPI should stabilize at about 3 percent by the medium term. 25 Annex A2: Country at a Glance 26 Antigua and Barbuda B a la nc e o f P a ym e nt s a nd T ra de 2000 2009 Governance indicators, 2000 and 2009 (US$ millio ns) To tal merchandise expo rts (fo b) 42 .. To tal merchandise impo rts (cif) 404 .. Voice and accountability Net trade in go o ds and services -38 -254 Political stability Current acco unt balance -71 -284 Regulatory quality as a % o f GDP -10.7 -25.1 Rule of law Wo rkers' remittances and co mpensatio n o f emplo yees (receipts) 21 24 Control of corruption Reserves, including go ld 64 .. 0 25 50 75 100 2009 Country's percentile rank (0-100) C e nt ra l G o v e rnm e nt F ina nc e higher values imply better ratings 2000 (% o f GDP ) Source: Kaufmann-Kraay-Mastruzzi, World Bank Current revenue (including grants) 18.2 19.5 Tax revenue 15.8 18.7 Current expenditure 26.6 25.9 T e c hno lo gy a nd Inf ra s t ruc t ure 2000 2008 Overall surplus/deficit -10.2 -14.3 P aved ro ads (% o f to tal) 33.0 .. Highest marginal tax rate (%) Fixed line and mo bile pho ne Individual .. .. 00 subscribers (per 1 peo ple) 78 202 Co rpo rate .. .. High techno lo gy expo rts (% o f manufactured expo rts) 0.1 0.1 E xt e rna l D e bt a nd R e s o urc e F lo ws E nv iro nm e nt (US$ millio ns) To tal debt o utstanding and disbursed .. .. A gricultural land (% o f land area) 30 30 To tal debt service .. .. Fo rest area (% o f land area) 21.4 21.4 Debt relief (HIP C, M DRI) – – Terrestrial pro tected areas (% o f surface area) .. 10.3 To tal debt (% o f GDP ) .. .. Freshwater reso urces per capita (cu. meters) 650 600 To tal debt service (% o f expo rts) .. .. Freshwater withdrawal (billio n cubic meters) .. .. Fo reign direct investment (net inflo ws) .. .. CO2 emissio ns per capita (mt) 4.5 5.1 P o rtfo lio equity (net inflo ws) .. .. GDP per unit o f energy use (2005 P P P $ per kg o f o il equivalent) .. .. Composition of total external debt, 2009 (data are not available) Energy use per capita (kg o f o il equivalent) .. .. Wo rld B a nk G ro up po rt f o lio 2000 2009 (US$ millio ns) IB RD To tal debt o utstanding and disbursed – – Disbursements – – P rincipal repayments – – Interest payments – – US$ millions IDA To tal debt o utstanding and disbursed – – Disbursements – – P riv a t e S e c t o r D e v e lo pm e nt 2000 2009 To tal debt service – – Time required to start a business (days) – 21 IFC (fiscal year) Co st to start a business (% o f GNI per capita) – 9.6 To tal disbursed and o utstanding po rtfo lio – – Time required to register pro perty (days) – 26 o f which IFC o wn acco unt – – Disbursements fo r IFC o wn acco unt – – Ranked as a majo r co nstraint to business 2000 2009 P o rtfo lio sales, prepayments and (% o f managers surveyed who agreed) repayments fo r IFC o wn acco unt – – n.a. .. .. n.a. .. .. M IGA Gro ss expo sure – – Sto ck market capitalizatio n (% o f GDP ) .. .. New guarantees – – B ank capital to asset ratio (%) .. .. No te: Figures in italics are fo r years o ther than tho se specified. 2009 data are preliminary. 2/25/11 .. indicates data are no t available. – indicates o bservatio n is no t applicable. Develo pment Eco no mics, Develo pment Data Gro up (DECDG). 27 28 Annex B5: Poverty and Social Indicators Antigua and Barbuda Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.07 0.07 0.09 572.5 1,001.7 Growth rate (% annual average for period) -1.3 1.9 1.3 1.2 0.9 Urban population (% of population) 35.0 34.0 30.4 79.0 74.9 Total fertility rate (births per woman) 2.0 1.7 .. 2.2 2.0 POVERTY (% of population) National headcount index .. .. 18.3* 29.6 Urban headcount index .. .. .. .. .. Rural headcount index .. .. .. .. .. INCOME GNI per capita (US$) 2,770 6,940 12,130 7,007 7,502 Consumer price index (2000=100) .. .. 109 123 127 Food price index (2000=100) .. .. .. .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. .. 0.48 .. .. Lowest quintile (% of income or consumption) .. .. 4.5 .. .. Highest quintile (% of income or consumption) .. .. 55.3 .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 3.6 3.8 3.9 3.8 Education (% of GDP) 2.5 .. 2.7 4.0 4.3 Net primary school enrollment rate (% of age group) Total .. .. 88 94 93 Male .. .. 90 94 93 Female .. .. 87 93 92 Access to an improved water source (% of population) Total .. 91 91 93 95 Urban .. 95 95 97 98 Rural .. 89 89 80 86 Immunization rate (% of children ages 12-23 months) Measles 69 93 99 93 93 DPT 99 99 99 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 73 75 .. 74 72 Male 71 72 73.9** 71 69 Female 75 77 79** 77 75 Mortality Infant (per 1,000 live births) .. 22 11 19 19 Under 5 (per 1,000) .. 26 12 23 22 Adult (15-59) Male (per 1,000 population) .. 142 .. 190 201 Female (per 1,000 population) .. 85 .. 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 100 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. Note: Latin-America rate corresponds to 4 U$S per day weighted by countries population, 2009. Source: SEDLAC World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *Individual Poverty Index. 2005 ** 2002 29 Annex B6: Key Economic Indicators Antigua and Barbuda - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 2 2 2 2 2 .. Industry 17 21 21 22 22 .. Services 81 77 77 76 76 .. Total Consumption 61 56 60 49 45 .. Gross domestic fixed investment 59 74 72 79 76 .. Government investment .. .. .. .. .. .. Private investment .. .. .. .. .. .. b Exports (GNFS) 57 50 48 49 48 .. Imports (GNFS) 77 80 80 77 68 .. Gross domestic savings 39 44 40 51 55 .. c Gross national savings 33 39 35 47 51 .. Memorandum items Gross domestic product 1023 1163 1318 1378 1253 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 11765 13217 14489 15031 13535 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 6.5 13.6 10.7 0.7 -11.3 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 5.1 12.2 9.3 -0.4 -12.2 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ millions) b Exports (GNFS) 545 551 602 642 584 .. Merchandise FOB 83 74 59 58 35 .. b Imports (GNFS) 683 818 933 943 838 .. Merchandise FOB 455 560 649 671 589 .. Resource balance -138 -267 -331 -300 -254 .. Net current transfers 8 22 15 15 15 .. Current account balance -188 -310 -380 -367 -252 .. Net private foreign direct investment 221 359 338 174 118 .. Long-term loans (net) -163 -26 -10 2 49 .. Official .. .. .. .. .. .. Private .. .. .. .. .. .. Other capital (net, incl. errors & omissions) 124 -38 50 197 98 .. d Change in reserves 7 15 1 -6 -13 .. Memorandum items Resource balance (% of GDP) -13.5 -23.0 -25.1 -21.8 -20.2 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 30 Antigua and Barbuda - Key Economic Indicators (Continued) Actual Estimate Projected Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 17.9 19.2 20.4 20.0 17.9 .. Current expenditures 20.4 21.8 21.1 20.6 27.0 .. Current account surplus (+) or deficit (-) -2.5 -2.6 -0.7 -0.6 -9.1 .. Capital expenditure 3.4 6.8 5.6 6.0 7.3 .. Foreign financing 2.4 2.1 3.1 4.3 3.5 .. Monetary indicators M2/GDP 100.3 95.5 93.6 91.8 97.3 .. Growth of M2 (%) 8.1 11.1 12.0 2.1 -0.8 .. Private sector credit growth / .. 172.1 81.6 62.1 -1.7 .. total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 95.0 93.9 91.3 91.7 92.3 .. Real interest rates Consumer price index (% change) 2.5 0.0 5.2 0.7 2.4 .. GDP deflator (% change) 4.0 0.0 2.4 3.8 2.5 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 31 Annex B8: (IFC) Committed and Disbursed Outstanding Investment Portfolio Antigua and Barbuda Committed and Disbursed Outstanding Investment Portfolio As of 12/29/2011 (In USD Millions) Committed Disbursed Outstanding **Quasi Partici **Quasi Partici FY Approval Company Loan Equity Equity *GT/RM pant Loan Equity Equity *GT/RM pant 2010 Aua 30 0 0 0 0 16.5 0 0 0 0 Total Portfolio: 30 0 0 0 0 16.5 0 0 0 0 * Denotes Guarantee and Risk Management Products. ** Quasi Equity includes both loan and equity types. 32 DOMINICA Annex 1: Country Profile Population: 71,293 (Preliminary results of National Census 2011) GNI Per Capita: US$6,833 (2011 World Economic Outlook) 1. Profile. Dominica (DOM) is the most northerly and largest of the Windward Islands. Mainstream tourism is not as developed as in other OECS countries due to the small number of white-sand beaches, high rainfall and poor air connections; however, eco-tourism is being promoted. Transport along with wholesale and retail trade are the mainstay of the economy and accounts for more than 20 percent of total value added. According to the Caribbean Development Bank’s Country Poverty Assessment, DOM had a poverty rate of 28.8 percent and an unemployment rate of 13.9 percent in 2008/2009. Dominica ranks 81st out of 187 countries in UNDP’s 2011 Human Development Index. Dominica is the only commonwealth member of the OECS, and the only island with a substantial surviving population of indigenous people, the Caribs. 2. Political Context. Independence: 1978 Last election: December 2009. In the recent election (December 2009), the Dominica Labour Party was re-elected winning a large majority, securing 18 of the country’s 21 seats in Parliament. 3. Economic Development and Challenges. During the global economic crisis, DOM’s GDP contracted to -0.7 percent in 2009. Its limited dependence on tourism, a mild pre-crisis boom in investments, and fiscal policies insulated it from experiencing a more severe contraction. GDP recovered to 0.3 percent in 2010 and is estimated to have increased by 0.9 percent in 2011. Economic activity is expected to reach 1.5 percent in 2012, but will remain below potential due to poor infrastructure, lack of competitiveness, and lower tourism receipts. Compared to other ECCU countries, DOM relies heavily on public investment, which has remained at 20 percent of GDP since 2004. Growth is projected to pick up gradually to 2 percent in the medium term. DOM’s economy will remain vulnerable to external shocks related to lower demand from its key trading partners, financial sector weaknesses, and weaker performance in agriculture, manufacturing, and trade. 4. Fiscal stance, debt and inflation. DOM entered the crisis with a relatively strong fiscal position. This allowed the authorities to inject a significant fiscal stimulus during 2007–09 at about 7 percent of GDP. Therefore, the primary balance deteriorated by 3.6 percent of GDP in 2008-2010 and materialized at -1.2 percent of GDP in 2010. The authorities agreed on the need for fiscal consolidation, and are appropriately planning to begin withdrawing the fiscal stimulus in 2012. The current account deficit improved from a 25.6 percent of GDP peak in 2008 to around 21.5 percent in 2009–10 due to falling commodity prices and a slowdown in FDI-related imports. Over the medium term, the current account deficit is projected to narrow by 17 percent of GDP with the falling cost of commodity imports, as food weight in the CPI is 30.2% and a recovery in tourist source countries, since tourism still accounts for a significant portion of the country’s exports. With prudent fiscal policies, DOM is expected to achieve Eastern Caribbean Central Union’s debt target of 60 percent by 2020. DOM has a relatively stable debt-to-GDP ratio. It declined from 100 percent in mid-2002 to 67.3 percent in mid-2011 following a large fiscal adjustment program, debt restructuring, and two IMF programs that supported shifting public financing to grants and concessional borrowing. It is expected to lower to 66.7 percent of GDP in 2012. While the recent surge in food and fuel prices has not yet translated into much 33 higher inflation, CPI inflation is projected to more than double in the second half of 2011, ending the year at about 3.5 percent. It should reach 2.6 percent at year-end 2012, in line with historical averages. 34 Annex A2: Country at a Glance 35 36 37 Annex B2: Selected Indicators of Bank Portfolio and Management CAS Annex B2 - Dominica Selected Indicators* of Bank Portfolio Performance and Management As Of Date 12/27/2011 Indicator 2009 2010 2011 0 Portfolio Assessment Number of Projects Under Implementation a 1 1 0 0 Average Implementation Period (years) b 2.3 3.3 0.0 0.0 Percent of Problem Projects by Number a, c 0.0 0.0 0.0 0.0 Percent of Problem Projects by Amount a, c 0.0 0.0 0.0 0.0 Percent of Projects at Risk by Number a, d 0.0 0.0 0.0 0.0 Percent of Projects at Risk by Amount a, d 0.0 0.0 0.0 0.0 Disbursement Ratio (%) e 36.7 90.6 97.4 0.0 Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 7 0 Proj Eval by OED by Amt (US$ millions) 24.5 0.0 % of OED Projects Rated U or HU by Number 14.3 0.0 % of OED Projects Rated U or HU by Amt 10.5 0.0 a.As shown in the Annual Report on Portfolio Performance (except for current FY). b.Average age of projects in the Bank's country portfolio. c.Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d.As defined under the Portfolio Improvement Program. e.Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 38 Annex B5: Poverty and Social Indicators Dominica Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.07 0.07 0.07 572.5 1,001.7 Growth rate (% annual average for period) 0.1 0.2 0.5 1.2 0.9 Urban population (% of population) 66.0 69.4 74.3 79.0 74.9 Total fertility rate (births per woman) 3.2 2.1 1.9 2.2 2.0 POVERTY (% of population) National headcount index .. .. 39.0 29.6 Urban headcount index .. .. 27.0 .. .. Rural headcount index .. .. 50.0 .. .. INCOME GNI per capita (US$) 1,180 2,910 4,900 7,007 7,502 Consumer price index (2000=100) 63 87 113 123 127 Food price index (2000=100) .. .. .. .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. .. 0.44* .. .. Lowest quintile (% of income or consumption) .. .. 5.3* .. .. Highest quintile (% of income or consumption) .. .. 52.3* .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 4.2 4.1 3.9 3.8 Education (% of GDP) .. .. 4.7 4.0 4.3 Net primary school enrollment rate (% of age group) Total .. .. 93 94 93 Male .. .. 92 94 93 Female .. .. 95 93 92 Access to an improved water source (% of population) Total .. 95 95 93 95 Urban .. 96 96 97 98 Rural .. 92 92 80 86 Immunization rate (% of children ages 12-23 months) Measles 93 99 99 93 93 DPT 91 99 99 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 72 75 77 74 72 Male 70 73 71.5** 71 69 Female 73 77 75.1** 77 75 Mortality Infant (per 1,000 live births) 15 15 8 19 19 Under 5 (per 1,000) 19 18 10 23 22 Adult (15-59) Male (per 1,000 population) .. 154 .. 190 201 Female (per 1,000 population) .. 113 .. 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 100 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *2009 ** 2002 39 Annex B6: Key Economic Indicators Dominica - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 14 13 13 14 14 .. Industry 15 16 16 16 15 .. Services 71 72 71 70 71 .. Total Consumption 94 89 100 102 98 .. Gross domestic fixed investment .. .. .. .. .. .. Government investment .. .. .. .. .. .. Private investment .. .. .. .. .. .. b Exports (GNFS) 43 45 40 38 38 .. Imports (GNFS) 66 63 69 71 66 .. Gross domestic savings 6 11 0 -2 2 .. c Gross national savings 3 12 1 -2 2 .. Memorandum items Gross domestic product 368 394 424 464 466 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 4925 5276 5472 5885 5959 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices -0.4 4.6 5.5 6.6 -0.4 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices -1.2 4.1 4.9 6.0 -1.0 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ millions) b Exports (GNFS) 129 144 140 149 149 .. Merchandise FOB 43 44 39 36 34 .. b Imports (GNFS) 196 199 236 280 252 .. Merchandise FOB 146 147 172 197 174 .. Resource balance -67 -54 -97 -130 -103 .. Net current transfers 20 20 21 19 16 .. Current account balance -76 -50 -95 -116 -102 .. Net private foreign direct investment 19 26 47 60 29 .. Long-term loans (net) 4 -3 -7 -3 -1 .. Official -5 -6 -5 -8 -6 .. Private 9 3 -1 4 5 .. Other capital (net, incl. errors & omissions) 46 13 57 65 69 .. d Change in reserves 7 14 -3 -5 5 .. Memorandum items Resource balance (% of GDP) -18.1 -13.8 -22.8 -28.1 -22.2 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 40 Dominica - Key Economic Indicators (Continued) Projecte Actual Estimate d Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 25.7 25.3 27.3 27.0 27.8 .. Current expenditures 23.9 22.9 23.4 23.6 22.9 .. Current account surplus (+) or deficit (-) 1.8 2.3 3.9 3.4 4.9 .. Capital expenditure 5.5 7.6 9.8 12.2 12.2 .. Foreign financing 0.6 1.3 -0.3 -4.2 2.7 .. Monetary indicators M2/GDP 86.7 90.3 90.8 87.2 95.0 .. Growth of M2 (%) 3.7 9.9 9.7 4.3 10.0 .. Private sector credit growth / .. -186.8 703.1 146.4 98.0 .. total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 91.2 90.6 88.9 87.5 89.4 .. Real interest rates Consumer price index (% change) 2.7 1.8 6.0 2.1 3.1 .. GDP deflator (% change) -0.8 2.4 1.9 2.6 0.9 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 41 Annex B7: Key Exposure Indicators Dominica - Key Exposure Indicators Actual Estimated Projected Indicator 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total debt outstanding and 274 253 290 297 252 232 220 210 200 a disbursed (TDO) (US$m) a Net disbursements (US$m) .. .. .. .. .. .. .. .. .. Total debt service (TDS) .. .. .. .. .. .. .. .. .. a (US$m) Debt and debt service indicators (%) b TDO/XGS .. .. .. .. 162.4 .. .. .. .. TDO/GDP 91.5 80.3 84.1 79.4 66.6 .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 51.0 50.5 44.4 41.7 48.9 47.7 47.2 47.2 46.9 IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. .. .. .. .. .. c DS (%) IBRD DS/XGS .. .. .. .. 0.4 .. .. .. .. d IBRD TDO (US$m) 4 3 3 2 1 1 1 0 0 Of which present value of guarantees (US$m) Share of IBRD portfolio (%) 0 0 0 0 0 0 0 0 0 d IDA TDO (US$m) 22 22 25 26 28 28 29 29 29 IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 42 Annex B8: Operations Portfolio (IBRD/IDA and Grants) CAS Annex B8 - Dominica Operations Portfolio (IBRD/IDA and Grants) As Of Date 12/27/2011 Closed Projects 8 IBRD/IDA * Total Disbursed (Active) of which has been repaid 0.00 Total Disbursed (Closed) 8.92 of which has been repaid 7.72 Total Disbursed (Active + Closed) 8.92 of which has been repaid 7.72 No Applicable Data Found. 0.00 0.00 0.00 0.00 0.00 Active Projects Difference Between Last PSR Expected and Actual Supervision Rating Original Amount in US$ Millions Disbursements a/ Development Implementation Project ID Project Name Fiscal Year IBRD IDA GRANT Cancel. Undisb. Orig. Frm Rev'd Objectives Progress 43 GRENADA Annex 1: Country Profile Population: 104,487 (2010 World Bank) GNI per capita: US$7,913 (2011 World Economic Outlook) 1. Profile. Grenada (GRE), which includes the two smaller islands of Carriacou and Petit Martinique, to its north, is the southernmost of the Windward Islands. Dubbed the Spice Island, Grenada was, until late 2004, the world’s second largest exporter of nutmeg and mace. On September 7, 2004, Hurricane Ivan—one of the strongest storms ever to strike the Caribbean region—passed directly over Grenada, severely damaging the housing stock, the nutmeg plantations and the tourism sector. Damages are estimated at nearly twice its GDP. According to the Caribbean Development Bank’s Country Poverty Assessment (CPA), GRE has a poverty rate of 37.7 percent and an unemployment rate of 24.9 percent in 2008. Grenada was ranked 67th in UNDP’s 2011 Human Development Index out of 187 countries. 2. Political Context. Independence: 1974 Last election: 2008 Following the Marxist military coup and subsequent US invasion in 1983, power has fluctuated between the New National Party and New Democratic Party, with the latter being elected most recently in 2008. 3. Economic Developments and Prospects. GRE experienced a significant economic slowdown during the global economic crisis. GDP fell from 1.7 percent in 2008 to -5.7 percent in 2009, decelerating further to -1.3 percent in 2010, mainly due to contractions in tourism and FDI- funded construction. Growth is expected to have stagnated in 2011, as private sector construction activity, tourism and agricultural output remain subdued. The long-term outlook is fragile and will depend on the progress toward fiscal consolidation, structural reforms, and debt management. In the medium term, authorities identified the following key macroeconomic objectives: ensuring fiscal and debt sustainability, reducing vulnerabilities in the financial system, and enabling private sector-led growth through structural reforms. 4. Fiscal stance, debt, and inflation. The primary balance slowly improved in recent years from over 10 percent of GDP following high capital expenditures in the aftermath of Hurricane Ivan. Grenada has a high debt service of 17 percent of government revenue, a wage-to-revenue ratio of 40.2 percent and an interest-to-revenue ratio of 11.6 percent. The debt-to-GDP ratio deteriorated significantly since 2008, going from 83.3 percent to 99.5 percent in 2011. It is projected to rise slightly and fall back to just under 100 percent by 2015. Twelve-month core inflation (excluding food and fuel) rose to 3.6 percent year over year in March 2010 reflecting the introduction of the VAT in February 2010, but fell back to 2.3 percent by end-2010. For 2011, core inflation is expected to stabilize at its historical average of about 2 percent, but headline inflation will remain higher (3-4 percent) due to a rise in international food and fuel prices (which represent approximately 50 percent of CPI). 44 Annex A2: Country at a Glance 45 46 47 Annex B2: Selected Indicators of Bank Portfolio and Management CAS Annex B2 - Grenada Selected Indicators* of Bank Portfolio Performance and Management As Of Date 12/27/2011 Indicator 2009 2010 2011 2012 Portfolio Assessment Number of Projects Under Implementation a 4 5 3 4 Average Implementation Period (years) b 2.8 3.1 3.8 3.3 Percent of Problem Projects by Number a, c 25.0 20.0 0.0 25.0 Percent of Problem Projects by Amount a, c 20.4 13.9 0.0 13.9 Percent of Projects at Risk by Number a, d 25.0 20.0 0.0 25.0 Percent of Projects at Risk by Amount a, d 20.4 13.9 0.0 13.9 Disbursement Ratio (%) e 18.7 25.3 25.8 14.9 Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 6 2 Proj Eval by OED by Amt (US$ millions) 38.8 11.6 % of OED Projects Rated U or HU by Number 16.7 50.0 % of OED Projects Rated U or HU by Amt 4.6 15.4 a.As shown in the Annual Report on Portfolio Performance (except for current FY). b.Average age of projects in the Bank's country portfolio. c.Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d.As defined under the Portfolio Improvement Program. e.Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 48 Annex B5: Poverty and Social Indicators Grenada Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.10 0.1 0.1 572.5 1,001.7 Growth rate (% annual average for period) 2.3 0.8 0.3 1.2 0.9 Urban population (% of population) 32.6 31.6 30.9 79.0 74.9 Total fertility rate (births per woman) 4.2 3.1 2.3 2.2 2.0 POVERTY (% of population) National headcount index .. 32* 37.7 29.6 Urban headcount index .. .. .. .. .. Rural headcount index .. .. .. .. .. INCOME GNI per capita (US$) .. 2,670 5,580 7,007 7,502 Consumer price index (2000=100) 62 81 112 123 127 Food price index (2000=100) .. .. .. .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. 0.45** 0.37 .. .. Lowest quintile (% of income or consumption) .. .. 7.3 .. .. Highest quintile (% of income or consumption) .. .. 45.7 .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 3.0 3.8 3.9 3.8 Education (% of GDP) 5.6 .. 4.9 4.0 4.3 Net primary school enrollment rate (% of age group) Total 92 .. 93 94 93 Male 92 .. 94 94 93 Female 92 .. 93 93 92 Access to an improved water source (% of population) Total .. 94 95 93 95 Urban .. 97 97 97 98 Rural .. 93 93 80 86 Immunization rate (% of children ages 12-23 months) Measles 49 88 99 93 93 DPT 61 95 99 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 66 72 75 74 72 Male 64 70 74 71 69 Female 68 73 77 77 75 Mortality Infant (per 1,000 live births) 44 23 13 19 19 Under 5 (per 1,000) 56 27 15 23 22 Adult (15-59) Male (per 1,000 population) .. 141*** 103 190 201 Female (per 1,000 population) .. 109*** 76 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 99 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *Individual Poverty Index. 1998 ** Index for 1998 *** 1997 data 49 Annex B6: Key Economic Indicators Grenada - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 3 4 4 4 5 .. Industry 26 23 22 20 15 .. Services 70 73 74 76 80 .. Total Consumption 95 104 102 109 107 .. Gross domestic fixed investment 50 40 39 33 23 .. Government investment 8 11 9 6 4 .. Private investment 43 30 30 27 19 .. b Exports (GNFS) 26 28 30 26 27 .. Imports (GNFS) 72 71 71 67 57 .. Gross domestic savings 5 -4 -2 -9 -7 .. c Gross national savings 15 -2 -5 -10 -9 .. Memorandum items Gross domestic product 697 701 759 830 761 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 6543 6552 6919 7274 6881 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 14.3 -4.2 5.8 1.4 -8.3 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 13.9 -4.5 5.4 1.1 -8.7 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ millions) b Exports (GNFS) 149 162 191 191 173 .. Merchandise FOB 33 32 41 41 35 .. b Imports (GNFS) 396 402 436 458 355 .. Merchandise FOB 300 297 328 339 263 .. Resource balance -247 -240 -246 -266 -182 .. Net current transfers 82 36 26 53 46 .. Current account balance -193 -233 -263 -242 -186 .. Net private foreign direct investment 70 90 152 142 103 .. Long-term loans (net) 23 7 19 14 15 .. Official 33 20 17 5 12 .. Private -10 -13 2 9 4 .. Other capital (net, incl. errors & omissions) 127 130 81 92 83 .. d Change in reserves -27 6 11 -6 -15 .. Memorandum items Resource balance (% of GDP) -35.5 -34.2 -32.4 -32.1 -23.9 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 50 Grenada - Key Economic Indicators (Continued) Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 19.1 20.4 20.9 20.7 19.7 .. Current expenditures 16.0 16.8 16.9 18.6 20.7 .. Current account surplus (+) or deficit (-) 3.1 3.6 4.0 2.1 -1.0 .. Capital expenditure 8.7 14.3 10.3 9.6 7.7 .. Foreign financing 6.1 2.2 0.3 2.0 3.6 .. Monetary indicators M2/GDP 101.4 99.6 102.3 95.7 107.1 .. Growth of M2 (%) -4.8 0.1 11.0 4.1 3.3 .. Private sector credit growth / .. 108.1 87.9 80.2 221.2 .. total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 91.2 91.6 89.8 91.1 92.0 .. Real interest rates Consumer price index (% change) 6.2 1.7 7.4 5.2 -2.3 .. GDP deflator (% change) 2.8 4.9 2.4 7.8 0.0 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 51 Annex B7: Key Exposure Indicators Grenada - Key Exposure Indicators Actual Estimated Projected Indicator 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total debt outstanding and 406 492 525 524 531 521 520 508 486 a disbursed (TDO) (US$m) a Net disbursements (US$m) .. .. .. .. .. .. .. .. .. Total debt service (TDS) .. .. .. .. .. .. .. .. .. a (US$m) Debt and debt service indicators (%) b TDO/XGS 217.1 242.2 225.6 229.3 294.2 .. .. .. .. TDO/GDP 73.3 87.2 86.0 77.2 84.8 .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 35.6 36.7 38.0 40.4 42.3 42.3 42.4 42.7 40.5 IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. .. .. .. .. .. c DS (%) IBRD DS/XGS 0.5 0.8 0.8 0.8 1.1 .. .. .. .. d IBRD TDO (US$m) 10 9 12 12 11 10 9 8 6 Of which present value of guarantees (US$m) Share of IBRD portfolio (%) 0 0 0 0 0 0 0 0 0 d IDA TDO (US$m) 23 28 35 37 39 42 45 46 47 IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 52 Annex B8: (IFC) Committed and Disbursed Outstanding Investment Portfolio Grenada Committed and Disbursed Outstanding Investment Portfolio As of 2/29/2012 (In USD Millions) Committed Disbursed Outstanding **Quasi Partici **Quasi Partici FY Approval Company Loan Equity Equity *GT/RM pant Loan Equity Equity *GT/RM pant 2002 Bel air 0.88 0 1 0 0 0.88 0 1 0 0 Total Portfolio: 0.88 0 1 0 0 0.88 0 1 0 0 * Denotes Guarantee and Risk Management Products. ** Quasi Equity includes both loan and equity types. 53 Annex B8: Operations Portfolio (IBRD/IDA and Grants) 54 ST. KITTS AND NEVIS Annex 1: Country Profile Population: 52,402 (2010 World Bank) GNI per capita: US$12,686 (2011World Economic Outlook) 1. Profile. St. Kitts and Nevis (SKN) lies in the Leeward Islands. The two islands are a federation: Nevis, the smaller island, has a population of 11,108, and exercises autonomy in most areas, with the exception of foreign, defense, and certain aspects of economic policy. Nevis has its own executive branch (Nevis Island Administration) and approximately one quarter of the federation’s population. The economy is based on tourism and agriculture, although the agricultural sector in St. Kitts has been shrinking. Unemployment is the lowest among OECS member countries at 6.3 percent in 2007/08. According to the Caribbean Development Bank’s Country Poverty Assessment, SKN has a poverty rate of 21.8 percent in 2007, which has fallen this decade from its 2000 level of 30.5 percent, and an unemployment rate of 5.1 percent in 2007. The 2011 UNDP Human Development Index ranks St. Kitts and Nevis 72nd among 187 countries. 2. Political Context: Independence: 1983 Last election: January 2010 The current administration, representing the St. Kitts and Nevis Labour Party, was reelected in January 2010. 3. Economic Development and Prospects. Economic activity in SKN contracted by 2.7 percent of GDP in 2010, due to the global recession and sharp declines in tourism, transport, and construction. Following weak domestic demand and labor market performances, GDP stagnated in 2011. A moderate rebound of 1.5 percent of GDP is expected for 2012. In the medium-term, and provided that demand picks up and structural reforms are accelerated, real GDP growth could reach an estimated 2-3 percent. 4. Fiscal stance, debt and inflation. The fiscal situation in SKN has deteriorated significantly in 2010 due to a drop in revenue and an increase in expenditures following Hurricane Omar in 2008 and the global economic recession. The primary balance decreased to -0.8 percent of GDP in 2010 (the first deficit in five years) as a result of a decline in total tax revenues due to depressed economic activity and contraction in international trade and transactions. The overall balance deteriorated from -2.9 percent of GDP in 2009 to -7.8 percent a year later. Faced with increasing fiscal imbalances in 2010, the authorities began implementing an ambitious program, supported by an IMF Stand-By Arrangement, to bring the primary balance to 5.6 percent of GDP by 2011 and the overall balance to -4.0 percent through fiscal consolidation, comprehensive debt restructuring, and financial sector strengthening. Preliminary results for 2011, point at an improved fiscal situation with a primary balance at 4.6 percent of GDP, and the overall deficit at 2 percent. In 2010, SKN’s debt-to-GDP ratio was 156.4 percent — the world’s second highest after Japan. The debt overhang is mainly caused by fiscal deficits; the acquisition of both liabilities but also assets (mostly land); as well as exogenous shocks (mainly natural disasters). In February 2012, the authorities launched a debt exchange offer to repay debt at lower interest rate over longer periods thus providing extensive debt relief to the country. Upon the expiry of the offer, holders of 96.8% of the aggregate amount of bonds and commercial loans eligible to participate in the offer agreed to exchange their claims for New Bonds. The domestic banking sector is highly exposed to this government debt because the authorities increasingly sought recourse to domestic financing. As a result, the government is facing both financing and 55 solvency difficulties and is, as such, at risk of debt distress. As a result of weak domestic demand, headline inflation remained subdued by 1.4 percent year over year at end-2011. Nonetheless, the wage bill is among the region’s highest, and recent increases in public sector wages have put pressure on real wages. Food prices remain volatile, after decreasing from 6.4 percent in 2008 to 1.1 percent in 2009 and rising to 5 percent at end-2010. CPI is expected to stabilize at 2.5 percent in 2011 and 2012. 56 Annex A2: Country at a Glance 57 58 59 Annex B2: Selected Indicators of Bank Portfolio and Management CAS Annex B2 - St. Kitts and Nevis Selected Indicators* of Bank Portfolio Performance and Management As Of Date 4/16/2012 Indicator 2009 2010 2011 2012 Portfolio Assessment Number of Projects Under Implementation a 2 0 0 0 Average Implementation Period (years) b 6.5 N/A N/A N/A Percent of Problem Projects by Number a, c 0 N/A N/A N/A Percent of Problem Projects by Amount a, c 0 N/A N/A N/A Percent of Projects at Risk by Number a, d 0 N/A N/A N/A Percent of Projects at Risk by Amount a, d 0 N/A N/A N/A Disbursement Ratio (%) e 35.0 N/A N/A N/A Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 5 2 Proj Eval by OED by Amt (US$ millions) 42.1 13.5 % of OED Projects Rated U or HU by Number 40.0 50.0 % of OED Projects Rated U or HU by Amt 25.6 41.5 a. As shown in the Annual Report on Portfolio Performance (except for current FY). b. Average age of projects in the Bank's country portfolio. c. Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d. As defined under the Portfolio Improvement Program. e. Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 60 Annex B5: Poverty and Social Indicators St. Kitts and Nevis Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.04 0.04 0.05 572.5 1,001.7 Growth rate (% annual average for period) -0.8 -0.5 1.0 1.2 0.9 Urban population (% of population) 35.2 33.7 32.4 79.0 74.9 Total fertility rate (births per woman) 3.0 2.5 .. 2.2 2.0 POVERTY (% of population) National headcount index .. 30.5* 21.8*** 29.6 Urban headcount index .. .. .. .. .. Rural headcount index .. .. .. .. .. INCOME GNI per capita (US$) 1,700 5,460 10,150 7,007 7,502 Consumer price index (2000=100) 56 71 118 123 127 Food price index (2000=100) .. .. .. .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. 0.3967** 0.397*** .. .. Lowest quintile (% of income or consumption) .. .. 7.3*** .. .. Highest quintile (% of income or consumption) .. .. 47.7 .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 3.2 3.6 3.9 3.8 Education (% of GDP) 5.7 .. 9.6 4.0 4.3 Net primary school enrollment rate (% of age group) Total .. 98 91 94 93 Male .. 99 90 94 93 Female .. 98 92 93 92 Access to an improved water source (% of population) Total .. 99 99 93 95 Urban .. 99 99 97 98 Rural .. 99 99 80 86 Immunization rate (% of children ages 12-23 months) Measles 91 99 99 93 93 DPT 92 99 99 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 65 69 71**** 74 72 Male 63 67 69**** 71 69 Female 67 72 74**** 77 75 Mortality Infant (per 1,000 live births) 29 21 13 19 19 Under 5 (per 1,000) 36 25 15 23 22 Adult (15-59) Male (per 1,000 population) .. 227 .. 190 201 Female (per 1,000 population) .. 165 .. 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 100 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *Individual Poverty Index. 2000 ** Only for St. Kitts, for Nevis is 0.3665. 1999 *** 2007 **** 2002 61 Annex B6: Key Economic Indicators St. Kitts and Nevis - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 2 2 2 2 2 .. Industry 22 22 22 22 20 .. Services 76 76 76 76 79 .. Total Consumption 71 79 80 92 94 .. Gross domestic fixed investment 42 39 43 41 40 .. Government investment .. .. .. .. .. .. Private investment .. .. .. .. .. .. b Exports (GNFS) 50 47 44 38 35 .. Imports (GNFS) 64 66 67 71 69 .. Gross domestic savings 29 21 20 8 6 .. c Gross national savings 26 21 21 12 6 .. Memorandum items Gross domestic product 511 589 647 702 673 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 9898 11492 12539 13853 12684 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 8.0 3.9 6.7 6.1 -6.3 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 5.7 3.0 5.8 5.3 -7.0 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ ) b Exports (GNFS) 227 236 232 227 197 .. Merchandise FOB 64 58 58 69 54 .. b Imports (GNFS) 280 321 341 409 362 .. Merchandise FOB 185 220 240 286 251 .. Resource balance -53 -85 -109 -182 -164 .. Net current transfers 24 32 29 33 38 .. Current account balance -65 -85 -110 -189 -179 .. Net private foreign direct investment 93 110 134 178 131 .. Long-term loans (net) -6 6 -2 2 -10 .. Official -6 -2 -9 .. -12 .. Private 0 9 7 .. 1 .. Other capital (net, incl. errors & omissions) -15 -49 -30 -6 6 .. d Change in reserves -7 17 7 15 52 .. Memorandum items Resource balance (% of GDP) -10.5 -14.4 -16.9 -25.9 -24.4 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 62 St. Kitts and Nevis - Key Economic Indicators (Continued) Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 31.4 30.9 29.6 28.7 29.7 .. Current expenditures 31.9 30.0 28.5 28.7 31.2 .. Current account surplus (+) or deficit (-) -0.4 0.8 1.1 0.0 -1.5 .. Capital expenditure 5.7 4.8 5.8 4.7 4.8 .. Foreign financing -4.0 -3.3 -1.7 4.6 0.2 .. Monetary indicators M2/GDP 107.9 110.4 117.2 107.2 118.8 .. Growth of M2 (%) 6.6 13.6 11.9 1.6 5.9 .. Private sector credit growth / 61.9 51.5 92.6 324.8 71.4 .. Total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 93.2 97.6 96.9 97.0 100.8 .. Real interest rates Consumer price index (% change) 6.0 7.9 2.1 7.6 1.0 .. GDP deflator (% change) 0.2 11.0 2.9 2.2 2.2 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 63 Annex B7: Key Exposure Indicators St. Kitts and Nevis - Key Exposure Indicators Actual Estimated Projected 200 200 200 200 Indicator 5 6 7 8 2009 2010 2011 2012 2013 Total debt outstanding and 292 290 271 247 227 .. .. .. .. a disbursed (TDO) (US$m) a Net disbursements (US$m) .. .. .. .. .. .. .. .. .. Total debt service (TDS) .. .. .. .. .. .. .. .. .. a (US$m) Debt and debt service indicators (%) b TDO/XGS .. .. .. .. .. .. .. .. .. TDO/GDP 66.6 59.5 52.8 43.3 41.6 .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 38.6 38.9 39.9 41.3 41.9 .. .. .. .. IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. .. .. .. .. .. c DS (%) IBRD DS/XGS .. .. .. .. .. .. .. .. .. d IBRD TDO (US$m) 13 13 13 13 12 .. .. .. .. Of which present value of guarantees (US$m) Share of IBRD portfolio (%) 0 0 0 0 0 .. .. .. .. d IDA TDO (US$m) 1 1 1 1 1 .. .. .. .. IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 64 ST. LUCIA Annex 1: Country Profile Population: 174,000 (2010 World Bank) GNI per capita: US$7,521 (2011 World Economic Outlook) 1. Profile. St. Lucia (SLU) is the most densely populated of the four Windward Islands. The soil is generally fertile and the banana industry (and other agriculture products) makes SLU the biggest exporter of agricultural products among the OECS member countries. The pleasant climate and the sandy beaches have encouraged the development of tourism, particularly in the honeymoon sector which has become the main foreign exchange earner in the economy. According to the Caribbean Development Bank’s Country Poverty Assessment, SLU has a poverty rate of 28.8 percent and an unemployment rate of 13 percent in 2005/2006. The 2011 UNDP Human Development Index classifies St. Lucia as 82th out of 187 countries. 2. Political Context. Independence: 1979 Last elections: 2011 The current administration, representing the St. Lucia Labour Party (SLP) was returned to office in December 2011, gaining 11 of the 17 contested seats. The remaining seats were taken by the United Workers Party. 3. Economic Developments and Prospects. SLU experienced a significant economic slowdown during the global economic crisis. Growth decreased from 5.8 percent in 2008 to -1.3 percent in 2009 as a result of downward pressures exerted on tourism arrivals, FDI, and exports. It bounced back to 4.4 percent in 2010, with the expansion in construction, trade, transport, and tourism. The outlook for 2011 reveals a positive growth rate of 2 percent and average of 2.5 percent in the medium term, but will depend on the recovery of SLU’s main trading partners, implementation capacity, and external shocks. 4. Fiscal stance, debt, and inflation. The fiscal stance shows deterioration in the overall deficit of 5.8 percent of GDP in 2010, and the outlook for 2011 indicates an even bigger widening of the deficits (-8.1 percent according to projected estimates). These fiscal deficits are mainly structural in nature; warranting further structural reforms to which the government has stressed its commitment through fiscal consolidation. Over the medium-term, some improvement in the fiscal position can be expected from the forthcoming introduction of the VAT by April 2012, preparations for which are underway with assistance from CARTAC, and from the withdrawal of the reconstruction-related spending. SLU has one of the lowest debt-to-GDP ratios among OECS Member States and its risk level for debt distress is moderate. However, it has been in a deteriorating trajectory since 2008. The debt-to-GDP is estimated to have increased in 2010 to 65.3 percent, and is expected to have reached 71.8 percent in 2011— it is expected to further deteriorate to 87.6 percent over the medium term (in 2016). Despite the increasing debt numbers, the government has stressed its commitment to placing debt on a firm downward trajectory by running primary surpluses. In line with the strong recovery, domestic credit to private sector is estimated to have increased by 1.5 percent in 2010. A pick up in domestic demand has pushed inflationary pressures, with CPI inflation estimated to increase by 3.5 percent y-o-y in 2011, after printing a 4.3 percent y-o-y increase in 2010. Preliminary estimates of the balance of payments indicate that the current account deficit worsened in 2011, reaching -19.1 percent of GDP, from - 12.5 percent in 2010. 65 Annex A2: Country at a Glance 66 67 68 Annex B2: Selected Indicators of Bank Portfolio Performance and Management CAS Annex B2 - St. Lucia Selected Indicators* of Bank Portfolio Performance and Management As Of Date 12/27/2011 Indicator 2009 2010 2011 2012 Portfolio Assessment Number of Projects Under Implementation a 3 3 3 3 Average Implementation Period (years) b 4.1 3.1 3.8 4.3 Percent of Problem Projects by Number a, c 33.3 33.3 0.0 33.3 Percent of Problem Projects by Amount a, c 17.2 13.5 0.0 12.1 Percent of Projects at Risk by Number a, d 33.3 33.3 0.0 33.3 Percent of Projects at Risk by Amount a, d 17.2 13.5 0.0 12.1 Disbursement Ratio (%) e 44.5 23.3 35.5 24.1 Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 10 4 Proj Eval by OED by Amt (US$ millions) 62.6 27.6 % of OED Projects Rated U or HU by Number 30.0 25.0 % of OED Projects Rated U or HU by Amt 24.8 8.1 a.As shown in the Annual Report on Portfolio Performance (except for current FY). b.Average age of projects in the Bank's country portfolio. c.Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d.As defined under the Portfolio Improvement Program. e.Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 69 Annex B5: Poverty and Social Indicators St. Lucia Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.1 0.1 0.2 572.5 1,001.7 Growth rate (% annual average for period) 1.5 1.6 1.1 1.2 0.9 Urban population (% of population) 27.9 29.6 27.9 79.0 74.9 Total fertility rate (births per woman) 3.7 2.9 2.0 2.2 2.0 POVERTY (% of population) National headcount index .. 25* 28.8 29.6 Urban headcount index .. 16.3* .. .. Rural headcount index .. 29.6* .. .. INCOME GNI per capita (US$) 1,460 3,570 5,190 7,007 7,502 Consumer price index (2000=100) 55 80 115 123 127 Food price index (2000=100) 60 95 104 .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. 42.6 0.42** .. .. Lowest quintile (% of income or consumption) .. 5.1 .. .. .. Highest quintile (% of income or consumption) .. 48.8 .. .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 3.0 5.4 3.9 3.8 Education (% of GDP) 7.1 .. 4.5 4.0 4.3 Net primary school enrollment rate (% of age group) Total 99 96 91 94 93 Male 97 97 91 94 93 Female 99 95 90 93 92 Access to an improved water source (% of population) Total .. 98 98 93 95 Urban .. 98 98 97 98 Rural .. 98 98 80 86 Immunization rate (% of children ages 12-23 months) Measles 68 94 99 93 93 DPT 87 98 95 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 69 71 73 74 72 Male 67 69 70 71 69 Female 71 74 76 77 75 Mortality Infant (per 1,000 live births) 23 17 19 19 19 Under 5 (per 1,000) 28 22 20 23 22 Adult (15-59) Male (per 1,000 population) .. 205 146 190 201 Female (per 1,000 population) .. 144 116 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 100 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. Note: Latin-America rate corresponds to 4 U$S per day weighted by countries population, 2009. Source: SEDLAC World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *Individual Poverty Index. 1995 ** 2005 70 Annex B6: Key Economic Indicators St. Lucia - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 4 4 3 5 4 .. Industry 21 23 19 18 17 .. Services 76 73 78 77 79 .. Total Consumption 90 105 105 113 97 .. Gross domestic fixed investment 24 29 27 26 24 .. Government investment .. .. .. .. .. .. Private investment .. .. .. .. .. .. b Exports (GNFS) 55 44 45 51 49 .. Imports (GNFS) 69 78 78 90 69 .. Gross domestic savings 10 -5 -5 -13 3 .. c Gross national savings 3 -9 -11 -19 -3 .. Memorandum items Gross domestic product 881 985 1063 1128 1105 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 5002 5684 6023 6286 6070 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices -2.6 7.8 1.2 5.4 -1.1 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices -4.7 6.9 0.3 4.5 -1.9 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ ) b Exports (GNFS) 512 440 457 529 491 .. Merchandise FOB 89 97 101 166 154 .. b Imports (GNFS) 595 707 747 821 649 .. Merchandise FOB 418 521 542 605 464 .. Resource balance -83 -266 -290 -292 -159 .. Net current transfers 13 12 14 16 13 .. Current account balance -142 -309 -345 -320 -140 .. Net private foreign direct investment 78 234 272 161 146 .. Long-term loans (net) 7 24 12 -14 24 .. Official 2 10 10 -6 -8 .. Private 5 14 3 -8 32 .. Other capital (net, incl. errors & omissions) 73 38 42 184 -52 .. d Change in reserves -17 13 19 -11 22 .. Memorandum items Resource balance (% of GDP) -9.4 -27.1 -27.3 -25.9 -14.4 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 71 St. Lucia - Key Economic Indicators (Continued) Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 24.2 24.3 24.4 25.3 25.3 .. Current expenditures 20.9 20.8 19.2 20.3 21.6 .. Current account surplus (+) or deficit (-) 3.3 3.4 5.2 5.0 3.7 .. Capital expenditure 9.8 9.5 7.5 5.9 6.7 .. Foreign financing 4.3 3.8 2.1 -2.3 0.1 .. Monetary indicators M2/GDP 77.7 85.7 89.1 92.6 97.8 .. Growth of M2 (%) 13.9 19.7 6.2 13.0 1.8 .. Private sector credit growth / 138.9 94.3 97.1 94.5 95.2 .. total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 92.3 92.7 89.4 90.4 93.3 .. Real interest rates Consumer price index (% change) 3.9 2.3 6.8 3.8 1.0 .. GDP deflator (% change) 8.8 3.7 6.7 0.7 -0.9 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 72 Annex B7: Key Exposure Indicators St. Lucia - Key Exposure Indicators Actual Estimated Projected Indicator 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total debt outstanding and 411 404 509 867 416 .. .. .. .. a disbursed (TDO) (US$m) a Net disbursements (US$m) .. .. .. .. .. .. .. .. .. Total debt service (TDS) .. .. .. .. .. .. .. .. .. a (US$m) Debt and debt service indicators (%) b TDO/XGS .. .. .. .. .. .. .. .. .. TDO/GDP 47.9 43.4 53.2 87.9 44.0 .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 24.4 28.9 26.3 21.8 44.1 .. .. .. .. IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. .. .. .. .. .. c DS (%) IBRD DS/XGS .. .. .. .. .. .. .. .. .. d IBRD TDO (US$m) 10 10 18 18 19 .. .. .. .. Of which present value of guarantees (US$m) Share of IBRD portfolio (%) 0 0 0 0 0 .. .. .. .. d IDA TDO (US$m) 11 16 24 43 21 .. .. .. .. IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 73 Annex B8: Operations Portfolio (IBRD/IDA and Grants) 74 ST. VINCENT AND THE GRENADINES Annex 1: Country Profile Population: 109,333 (2010 World Bank) GNI per capita: US$6,447 (2011 World Economic Outlook) 1. Profile. St. Vincent and the Grenadines (SVG) consists of 32 islands. St Vincent, the northernmost island, is the country's commercial and political center, accounting for 90 percent of both the land area and population. The volcanic island is lush and green, its deep valleys cultivated with bananas, coconuts and arrowroot. The others belong to the Grenadines, a chain of about 800 islets extending between St. Vincent and Grenada, which attract a large number of yachting tourists. According to the Caribbean Development Bank’s Country Poverty Assessment, SVG has a poverty rate of 30.2 percent and an unemployment rate of 18.8 percent in 2007/08. SVG ranks 85st out of 187 countries on the 2011 UNDP Human Development Index. 2. Political Context. Independence: 1979 Last election: 2010 The current administration, representing the Unity Labour Party was re-elected in December 2010. They have been in power since 2001, when 15 years of rule by the New Democratic Party came to an end. A constitutional referendum was held in SVG on 25 November 2009, which would have abolished the monarchy of SVG, headed by Queen Elizabeth II, and would have given power to the opposition. However, the proposal was supported by only 43.13 percent of voters in the referendum, well short of the required two-thirds threshold. 3. Economic Developments and Prospects. The torrential rain in April 2011 that led to landslides, flooding, and extensive damage to infrastructure was the second natural disaster to hit SVG in less than six months. The estimated costs of the damages are around 3.6 percent of GDP. This event exerted further strain on an already challenging growth situation where the global economic crisis led to a contraction in growth of 2.3 percent in 2009 and Hurricane Tomas caused estimated damages of 5.3 percent of GDP, reducing growth further by 1.8 percent in 2010. Growth is estimated to have slightly contracted by 0.4 percent in 2011, but is projected to reach2.5 percent over the medium term, depending on increases in tourism and FDI. 4. Fiscal stance, debt and inflation. The central government’s fiscal operations in 2010 and 2011 deteriorated due to Hurricane Tomas. Overall deficit is expected to increase to 5.8 percent of GDP in 2010 from its level of 3.2 percent in 2009. The 2011 budget, announced in late January 2011, included additional spending of about 1 percent of GDP for rehabilitation and reconstruction activities in the aftermath of Hurricane Tomas. Additional activities, about 0.6 percent of GDP, are expected to be executed by state-owned enterprises. The Government is aiming for a primary surplus of 1.5-2 percent of GDP over the medium term so they can improve the capacity to respond to unfavorable exogenous shocks. Fiscal revenues have fallen and capital expenditure risen in 2011—leading to a projected primary deficit of 0.3 percent of GDP and an overall balance of -3.2 percent of GDP. Due to the persistent primary deficit, public debt keeps accumulating and the debt-to-GDP ratio is projected to hit 70 percent of GDP in 2011, which remains one of the lowest among the OECS countries. Given the commitment of the authorities for fiscal consolidation, and the upward revision in the GDP series, the risk of external debt distress is moderate. Increases in food and commodity prices will hurt the poor since 54 percent of the consumption basket is accounted for by food. After a year of deflation in 2009, inflation 75 has slightly picked up in 2010 to 2 percent and 4.7 percent in 2011, mainly reflecting the increase in food prices. 76 Annex A2: Country at a Glance 77 78 79 Annex B2: Selected Indicators of Bank Portfolio Performance and Management CAS Annex B2 - St. Vincent and Grenadines Selected Indicators* of Bank Portfolio Performance and Management As of Date 12/27/2011 Indicator 2009 2010 2011 2012 Portfolio Assessment Number of Projects Under Implementation a 2 2 2 1 b Average Implementation Period (years) 5.0 6.0 3.7 1.2 a, Percent of Problem Projects by Number c 0.0 0.0 0.0 0.0 a, Percent of Problem Projects by Amount c 0.0 0.0 0.0 0.0 a, d Percent of Projects at Risk by Number 50.0 0.0 0.0 0.0 a, d Percent of Projects at Risk by Amount 47.0 0.0 0.0 0.0 e Disbursement Ratio (%) 16.2 30.0 67.1 16.6 Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 4 0 Proj Eval by OED by Amt (US$ millions) 16.5 0.0 % of OED Projects Rated U or HU by Number 0.0 0.0 % of OED Projects Rated U or HU by Amt 0.0 0.0 a. As shown in the Annual Report on Portfolio Performance (except for current FY). b. Average age of projects in the Bank's country portfolio. c. Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d. As defined under the Portfolio Improvement Program. e. Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 80 Annex B5: Poverty and Social Indicators St. Vincent and the Grenadines Social Indicators Latest single year Same region/income group Latin Upper- America middle- 1980-85 1990-95 2003-09 & Carib. income POPULATION Total population, mid-year (millions) 0.1 0.1 0.1 572.5 1,001.7 Growth rate (% annual average for period) 0.8 0.1 0.1 1.2 0.9 Urban population (% of population) 33.6 43.0 47.4 79.0 74.9 Total fertility rate (births per woman) 3.3 2.7 2.1 2.2 2.0 POVERTY (% of population) National headcount index .. 37* 30.2 29.6 Urban headcount index .. .. .. .. .. Rural headcount index .. .. .. .. .. INCOME GNI per capita (US$) 1,030 2,290 5,130 7,007 7,502 Consumer price index (2000=100) 63 85 121 123 127 Food price index (2000=100) 71 97 102 .. .. INCOME/CONSUMPTION DISTRIBUTION Gini index .. 0.6 .. .. .. Lowest quintile (% of income or consumption) .. .. .. .. .. Highest quintile (% of income or consumption) .. .. .. .. .. SOCIAL INDICATORS Public expenditure Health (% of GDP) .. 3.8 3.2 3.9 3.8 Education (% of GDP) .. .. 6.6 4.0 4.3 Net primary school enrollment rate (% of age group) Total 95 98 95 94 93 Male 95 99 97 94 93 Female 95 97 92 93 92 Access to an improved water source (% of population) Total .. .. .. 93 95 Urban .. .. .. 97 98 Rural .. 93 93 80 86 Immunization rate (% of children ages 12-23 months) Measles 74 99 99 93 93 DPT 90 97 99 92 93 Child malnutrition (% under 5 years) .. .. .. 4 .. Life expectancy at birth (years) Total 68 70 72 74 72 Male 65 67 70 71 69 Female 70 73 74 77 75 Mortality Infant (per 1,000 live births) 28 19 11 19 19 Under 5 (per 1,000) 35 23 12 23 22 Adult (15-59) Male (per 1,000 population) .. 202 154 190 201 Female (per 1,000 population) .. 119 102 103 122 Maternal (modeled, per 100,000 live births) .. .. .. 86 82 Births attended by skilled health staff (%) .. 100 99 89 96 Note: 0 or 0.0 means zero or less than half the unit shown. Net enrollment rate: break in series between 1997 and 1998 due to change from ISCED76 to ISCED97. Immunization: refers to children ages 12-23 months who received vaccinations before one year of age or at any time before the survey. Note: Latin-America rate corresponds to 4 U$S per day weighted by countries population, 2009. Source: SEDLAC World Development Indicators database, World Bank - 15 April 2011. Caribbean Development Bank Country Poverty Assessment Reports and Annual Economic Reports *Individual Poverty Index. 1996 81 Annex B6: Key Economic Indicators St. Vincent and the Grenadines - Key Economic Indicators Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 Agriculture 6 6 6 7 7 .. Industry 19 19 21 20 19 .. Services 75 75 73 74 74 .. Total Consumption 89 88 99 105 103 .. Gross domestic fixed investment 32 35 36 35 35 .. Government investment .. .. .. .. .. .. Private investment .. .. .. .. .. .. b Exports (GNFS) 44 42 38 35 34 .. Imports (GNFS) 65 65 72 75 72 .. Gross domestic savings 11 12 1 -5 -3 .. c Gross national savings 9 11 1 -5 -3 .. Memorandum items Gross domestic product 551 611 685 702 699 .. (US$ million at current prices) GNI per capita (US$, Atlas method) 4921 5497 6135 6244 6182 .. Real annual growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 2.5 7.7 3.6 1.7 -1.2 .. Gross Domestic Income .. .. .. .. .. .. Real annual per capita growth rates (%, calculated from 2006 prices) Gross domestic product at market prices 2.3 7.5 3.4 1.5 -1.3 .. Total consumption .. .. .. .. .. .. Private consumption .. .. .. .. .. .. Balance of Payments (US$ ) b Exports (GNFS) 201 212 212 210 199 .. Merchandise FOB 43 41 51 56 54 .. b Imports (GNFS) 291 326 402 439 410 .. Merchandise FOB 212 238 288 299 294 .. Resource balance -91 -114 -190 -230 -211 .. Net current transfers 18 20 20 24 23 .. Current account balance -99 -118 -191 -202 -198 .. Net private foreign direct investment 40 109 131 121 108 .. Long-term loans (net) 26 -4 10 2 15 .. Official 5 7 8 -1 10 .. Private 21 -10 1 3 5 .. Other capital (net, incl. errors & omissions) 36 0 52 82 84 .. d Change in reserves -3 12 -2 -3 -9 .. Memorandum items Resource balance (% of GDP) -16.4 -18.6 -27.8 -32.7 -30.2 .. Real annual growth rates ( YR90 prices) Merchandise exports (FOB) .. .. .. .. .. .. Primary .. .. .. .. .. .. Manufactures .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. 82 St. Vincent and the Grenadines - Key Economic Indicators (Continued) Actual Estimate Indicator 2005 2006 2007 2008 2009 2010 Public finance (as % of GDP at market e prices) Current revenues 22.7 23.8 23.4 25.8 24.4 .. Current expenditures 21.8 21.5 20.5 22.7 24.8 .. Current account surplus (+) or deficit (-) 0.9 2.2 3.0 3.1 -0.3 .. Capital expenditure 5.4 6.1 7.1 6.9 6.9 .. Foreign financing 10.9 3.2 2.6 0.7 0.6 .. Monetary indicators M2/GDP 76.5 72.6 70.6 68.2 68.3 .. Growth of M2 (%) 4.8 6.0 8.2 1.4 0.4 .. Private sector credit growth / 45.4 100.5 84.8 51.3 42.0 .. total credit growth (%) Price indices( YR90 =100) Merchandise export price index .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. f Real exchange rate (US$/LCU) 88.2 87.7 87.9 91.2 93.8 .. Real interest rates Consumer price index (% change) 3.9 4.8 8.3 8.7 -1.6 .. GDP deflator (% change) 3.0 2.9 8.2 0.9 0.7 .. a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 83 Annex B7: Key Exposure Indicators St. Vincent and the Grenadines - Key Exposure Indicators Actual Estimated Projected Indicator 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total debt outstanding and 251 241 200 203 209 .. .. .. .. a disbursed (TDO) (US$m) a Net disbursements (US$m) .. .. .. .. .. .. .. .. .. Total debt service (TDS) .. .. .. .. .. .. .. .. .. a (US$m) Debt and debt service indicators (%) b TDO/XGS .. .. .. .. .. .. .. .. .. TDO/GDP 56.2 48.5 36.1 34.9 .. .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 37.4 38.4 48.3 46.2 50.2 .. .. .. .. IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. .. .. .. .. .. c DS (%) IBRD DS/XGS .. .. .. .. .. .. .. .. .. d IBRD TDO (US$m) 0 0 0 0 0 .. .. .. .. Of which present value of guarantees (US$m) Share of IBRD portfolio (%) 0 0 0 0 0 .. .. .. .. d IDA TDO (US$m) 15 16 18 19 20 .. .. .. .. IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 84 Annex B8: Operations Portfolio (IBRD/IDA and Grants) 85 IBRD 33564 67° 66° 65° 64° 63° 62° 61° 60° 59° 20° THE CARIBBEAN AREA 20° ORGANIZATION OF EASTERN CARIBBEAN STATES 19° OECS PARTICIPATING MEMBERS 19° Virgin Islands (UK) Anguilla (UK) AT L A N T I C Puerto Rico (US) Virgin Islands St. Maarten (Neth), 18° St. Martin (Fr) 18° (US) St. Barthelemy (Fr) OCEAN Saba (Neth) St. Eustasius (Neth) ANTIGUA AND BARBUDA ST. KITTS and NEVIS 17° 17° Montserrat (UK) Guadeloupe (Fr) 16° 16° Area of Map DOMINICA 15° 15° Martinique (Fr) 14° 14° ST. LUCIA C a r i b b e a n S e a ST. VINCENT BARBADOS 13° and the 13° GRENADINES 0 50 100 150 GRENADA 12° MILES 12° 11° 11° TRINIDAD and TOBAGO This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and 10° any other information shown on this map do not imply, on R . B . D E the part of The World Bank Group, any judgment on the V E N E Z U E L A legal status of any territory, or any endorsement or acceptance of such boundaries. 67° 66° 65° 64° 63° 62° 61° AUGUST 2004