Caribbean Development Bank

Caribbean Development Bank

Formation	October 18, 1969; 55 years ago (1969-10-18)
Purpose	Regional development
Headquarters	Wildey, St. Michael, Barbados
Membership	28 (19 borrowing members) (9 non-borrowing members)
President	Hyginus 'Gene' Leon
Website	www.caribank.org

The Caribbean Development Bank (CDB) is a development bank that helps Caribbean countries finance social and economic programs in its member countries through loans, grants, and technical assistance. The CDB was established by an Agreement signed on October 18, 1969, in Kingston, Jamaica, which entered into force on January 26, 1970. The idea for the bank originated from the 1966 Canada/Commonwealth Caribbean Conference.^[1]

The permanent headquarters of the CDB is located in Wildey, St. Michael, Barbados, adjacent to the campus of the Samuel Jackman Prescod Polytechnic. On September 21, 2018, the Bank officially opened its Country Office in Haiti, the first outside its Headquarters in Barbados. The headquarters in Barbados serves all of the regional borrowing member countries, with staff recruited from its member states.^[2]

The CDB's membership consists of 28 countries, including:

• 19 regional borrowing members^[3]
• 4 regional, non-borrowing members: Brazil, Colombia, Mexico and Venezuela ^[4]
• 5 non-regional, non-borrowing members: Canada, China, Germany, Italy, and the United Kingdom^[4]

As of December 31, 2021, the CDB's total assets stood at US$3.71 billion, which included US$2.21 billion of Ordinary Capital Resources and US$1.50 billion of Special Funds Resources.

The Bank holds a high credit rating from international agencies:

• Aa1 (Stable) by Moody's
• AA+ (Stable) by Standard & Poor's
• AA+ (Stable) by Fitch Ratings.

In 2021, the Bank approved US$269.5 million in loans and grants. At the end of 2020, the total value approved projects by the bank was US$122.6 million, including US$71.2 million in loans and US$51.4 million in grants.

The Caribbean Development Bank was established by an agreement between sixteen members of the Commonwealth of Nations in the Caribbean region, along with Canada and the United Kingdom. Signed on October 18, 1969, in Kingston, Jamaica, the Agreement entered into force on January 26, 1970 when 15 of the 18 signing states ratified it. ^[5] The bank's initial capital was 50 million USD, equivalent to 100 million Eastern Caribbean dollar, with main contributions from Jamaica (11,200,000 USD and 19.52% of votes), and the United Kingdom and Canada contributing 10,000,000 USD each with 17.55% of votes in bank.^[6]

The bank was created with the purpose of promoting sustainable economic growth and reducing poverty in the region, aligning with Arthur Lewis's vision of economic development. ^[7] During the first meeting of governors in Nassau, Lewis, who was an economist, was appointed the first president of the Caribbean Development Bank. His leadership was essential to establishing the bank's operations, emphasizing the importance of financial discipline and efficiency in development through agriculture and infrastructure projects. At this time, the bank aimed to reduce economic disparities among its member states by using soft loans to finance public works and agricultural development in the less developed states. ^[5]

Lewis set the CDB's independence up by retaliating against political interference in the financial decisions of the bank. He also ensured there would be efficient administration and a focus on the Caribbean states to become a key financial instrument for the countries that lacked access to international financial institutions. Lewis also played a key role in building strong relationships with other international organizations like the Inter-American Development Bank (IDB) and USAID that helped the bank gain legitimacy and credibility.^[5]

The Bank has had six presidents since its inception.^[8]

Name	Dates	Nationality
William Arthur Lewis	1970–1973	Saint Lucia
William G. Demas	1974–1988	Trinidad and Tobago
Neville Nicholls	1988–2001	Barbados
Compton Bourne	2001–2011	Guyana
William Warren Smith	2011–2021	Jamaica
Hyginus 'Gene' Leon[9]	2021–2024	Saint Lucia

The Board of Governors is the apex governing body of the CDB. It meets annually and has the authority to:

• Admit new members
• Amend the charter
• Elect the Board of Directors and President
• Change the bank's outstanding capital
• Dissolve the bank.

Each country is represented by one governor and one alternate, with the British Overseas Territory members counted as one country. ^[10]

The Board of Directors is responsible for:

• Determining the bank's programs and annual budget
• Overseeing its operations
• Appointing the Oversight and Assurance Committee

As with the Board of Governors, each country is represented by one director and one alternate. Directors serve renewable two-year terms. ^[10]

The President is the chief executive officer of the CDB, and also serves as the Chairman of the Board of Directors. Different offices for communication, risk management, and compliance are part of the Office of the President.

Presidential candidates are nominated by individual country members. A candidate must receive votes from two-thirds of the Board of Governors (representing 75% of the member countries) in order to be selected. The President serves for a five-year term, with the possibility of re-election.^[10]

The two corporate leaders that report to the boards are the Vice-President (Corporate Services) and Bank Secretary, and the Vice-President (Operations).

As of 2023, there are nineteen borrowing members^[11] and nine non-borrowing members.^[12]

Anguilla  Antigua and Barbuda  Bahamas  Barbados  Belize  British Virgin Islands  Cayman Islands  Cuba pending[13]  Dominica  Dominican Republic pending[13]  Grenada

Guyana  Haiti  Jamaica  Montserrat  Saint Kitts and Nevis  Saint Lucia  Saint Vincent and the Grenadines  Suriname  Trinidad and Tobago  Turks and Caicos Islands

Argentina (pending)[13]  Brazil  Colombia  Mexico  Venezuela

Canada  China  Germany  Italy  United Kingdom

The United Nations launched Development Business in 1978 with the support of the Caribbean Development Bank, the World Bank, and many other major development banks from around the world. Today, Development Business is the primary publication for all major multilateral development banks, United Nations agencies, and several national governments, many of whom have made the publication of their tenders and contracts in Development Business a mandatory requirement.^[14]

In 2012, the CDB experienced a credit downgrade due to weaknesses in the banks credit profile. The downgrade reflected concerns about the deteriorating financial conditions of its borrowing member countries, this posed risks the banks ability to finance loans effectively. There were also inefficiencies in CDB's risk management practices which prompted the bank to adopt a Enterprise Risk Management framework to address these issues. This design was meant strengthen the bank's governance, risk management, and operational processes, ensuring better oversight, accountability, and financial stability. ^{[15] [16]}

The CDB collaborates with distinct institutions like the Green Climate Fund to promote sustainable development and climate resilience across the region. ^[17] The bank also facilitates soft loans and technical assistance for its smaller member states by working closely with partners like the Inter-American Development Bank and the World Bank. ^[18][19]

• African Development Bank
• African, Caribbean and Pacific Group of States
• Asian Development Bank
• Asian Infrastructure Investment Bank
• New Development Bank (BRICS)/NDB BRICS
• Association of Caribbean States
• CAF – Development Bank of Latin America and the Caribbean
• Central banks and currencies of the Caribbean
• European Investment Bank
• Islamic Development Bank

• Official Caribbean Development Bank website