CAF Releases First Study on Caribbean Infrastructure Needs

The Development Bank of Latin America and the Caribbean (CAF) has conducted its first study on the Caribbean’s infrastructure needs.

A preview of the report, Sustainable Pathways: Addressing Infrastructure Needs in the Caribbean, was presented on January 29 at CAF’s inaugural International Economic Forum in Panama City by Walter Cont, Director of Socioeconomic Research.

Analyzing infrastructure gaps across 15 Caribbean Community (CARICOM) member states, the report focuses on energy, transport (road and marine), water/sanitation, and ICT. It employs a “traffic light” system to indicate areas requiring improvement, from minor upgrades to major investment opportunities.

Key findings highlight high electricity costs compared to Latin America and the U.S., driven by dependence on fossil fuels. Grenada has the highest rates, exceeding US$0.45 per kilowatt-hour, while Trinidad & Tobago has the lowest at under US$0.05.

Despite high prices, power grid access and reliability across CARICOM are strong. The report underscores opportunities to invest in resilient energy systems to withstand natural disasters and external shocks.

Water rates remain affordable due to subsidies, though concerns over scarcity persist despite high access levels.

Cont outlined four key recommendations:

1. Viewing climate change mitigation as both a decarbonization and development opportunity.
2. Investing in resilient infrastructure for long-term sustainability.
3. Modernizing governance and regulatory frameworks.
4. Enhancing regional coordination and cooperation.

CAF is prepared to support Caribbean nations in strengthening their infrastructure, leveraging its experience from Latin American projects. The full report, including detailed analysis and policy recommendations, will be released in March.