The World Bank has approved a US$24 million Development Policy Credit to help Dominica strengthen its domestic revenues, boost financial sector resilience, and ramp up disaster preparedness — all while protecting its rich biodiversity, officials announced today.
The new financing, part of the Dominica Strengthening Fiscal and Climate Resilience Programmatic Development Policy Credit, aims to support the island’s ongoing efforts to recover from years of climate-related setbacks and build a more sustainable future. Known as the “Nature Island of the Caribbean,” Dominica relies heavily on its natural ecosystems to fuel its tourism economy, but repeated disasters — from Tropical Storm Erika in 2015 to Hurricane Maria in 2017, and most recently Hurricane Beryl in 2024 — have severely impacted its development and strained public finances. Public debt, which soared to 118.2% of GDP in 2020, remains high at 103% as of 2024.
“Dominica faces the dual challenge of managing high disaster vulnerability and fiscal fragility. This initiative supports strategic policy reforms that are vital for building resilience, generating sustainable revenue, and protecting Dominica’s extraordinary natural heritage,” said Lilia Burunciuc, World Bank Division Director for the Caribbean.
Key reforms under the program include overhauling excise taxes — levies on items like fuel, alcohol, and sugary drinks — to boost revenue, cut emissions, and improve public health outcomes. It also strengthens oversight of major financial institutions, such as the Dominica Agricultural Industrial and Development Bank and local credit unions, aiming to stabilize the country’s financial system.
The plan goes beyond fiscal reforms. Dominica is setting a global milestone by establishing the world’s first marine protected area dedicated specifically to sperm whales. By 2027, revenue from “swim-with-the-whales” permits is projected to rise by 177%, supporting conservation efforts, eco-tourism, and local livelihoods. Additionally, the government is rolling out a new risk-based asset management system to prioritize and protect public infrastructure, aiming to inventory and assess 40% of public fixed assets for disaster risk by 2027.
The initiative aligns closely with Dominica’s National Resilience Development Strategy 2030 and the Climate Resilience and Recovery Plan 2020–2030. It was developed through broad consultation with national stakeholders, the Caribbean Development Bank, and the International Monetary Fund.
Funding comes from the International Development Association (IDA), the World Bank’s arm focused on supporting low-income and small island nations. Unlike traditional project funding, Development Policy Credits provide direct budget support to governments that have already implemented agreed-upon reforms, giving Dominica a timely boost to continue investing in its resilience and long-term prosperity.
