Grenada - First Competitiveness and Resilience Development Policy Credit with a Catastrophe Deferred Drawdown Option

Overview & Synopsis

The development objective of the Grenada - First Competitiveness and Resilience Development Policy Credit with a Catastrophe Deferred Drawdown Option for Grenada is to support policy reforms that foster a more competitive business environment and strengthen resilience to climate and other shocks. The operation focuses on two areas of work. First, to support a competitive business environment, it advances trade facilitation by establishing an advance rulings regime on tariff classification and origin to reduce uncertainty and clearance times at customs, and modernizes the payments ecosystem by enacting a legal framework that licenses and oversees bank and non-bank payment service providers, expands consumer protection, and enables digital and mobile payments under the oversight of the Eastern Caribbean Central Bank. Second, to strengthen resilience, it introduces comprehensive water resources and wastewater governance through a new legal framework for licensing water abstraction and regulating effluent disposal; establishes a national, risk-based asset management system to register, assess, and prioritize maintenance and investment decisions for public buildings; and improves the targeting methodology of the Support for Education, Empowerment and Development cash transfer program to better identify poor and vulnerable households, including female-headed households, and to enable faster, more predictable support in crises. The operation also provides a Catastrophe Deferred Drawdown Option that offers pre-arranged, rapid liquidity upon a government disaster declaration, reinforcing disaster risk financing and helping reduce the time from shock to first emergency transfer. Expected results include lower import clearance times, greater use of electronic funds transfers, issuance of water and effluent licenses, widespread adoption of risk prioritization scores for public buildings, faster post-shock disbursements, and more SEED beneficiaries accurately identified as poor.