JAMAICAN businesses whose activities have been disrupted by Hurricane Melissa have been thrown a lifeline by the Development Bank of Jamaica (DBJ), to the tune of $10 billion, to help them get back on their feet.

Businesses which qualify for assistance will each be able to access between $20 million and $50 million through approved financial institutions (AFIs) and microfinance institutions (MFIs).

Managing director of DBJ David Lowe announced the measures being taken by the bank during a special media briefing on Wednesday at Jamaica House.

He said an M5 Business Recovery Programme has been designed to assist with recovery, resilience, and restoration, and is broken down into three key phases.

Phase one will see $1 billion being made immediately available to AFIs and MFIs to onlend to business operators. Under phase two, $3 billion in additional support will be provided, while $7 billion is set aside to assist in the overall rebuilding of particular sectors, supply chains, and other economic actors.

Lowe pointed out that immediately following the passage of Melissa, DBJ engaged in consultations with its existing beneficiaries on loan and credit facilities, and with its AFI partners, local banks, microfinance institutions, the Small Business Association of Jamaica, Jamaica Manufacturers and Exporters Association, Jamaica Chamber of Commerce, and others.

He said the purpose of the consultations was primarily to get an understanding from the various groups about what their members were facing.

According to Lowe, the DBJ sought to identify the gaps regarding access to finance and its ability to support businesses that have a range of impact, from those that were immediately in the path of the storm, to those which had indirect exposure based on the disruption to supply chains.

He acknowledged that $10 billion will not address all the existing needs but argued that it was “robust enough to start”.

The framework being pursued by the DBJ has three distinct product windows, the first focusing on refinancing. This will address businesses which are indirectly affected and which already have credit facilities in place.

“What we have done is to look at how we can engage in an assessment of terms and relax certain issues that can allow them to continue and have some breathing space,” Lowe explained.

The second framework covers what is referred to as the reboot window and is aimed at addressing short-term needs, inventory, and addressing infrastructure damage. The third framework centres on rebuilding, which is expected to take place over the long term. It will focus on those businesses that have been “totally disrupted”.

Putting things into context, Lowe noted that during the COVID-19 pandemic business activity was disrupted but infrastructure remained intact.

“It was the movement of people that was primarily impacted,” Lowe pointed out.

“In this particular situation it is far worse; the complexity includes infrastructure as well as disruption to business.

“We have to have a long-term plan in terms of how do we support resilience, and to make sure that we are in a position to ensure that you are…perfectly suited to withstand any catastrophe, but your ability to recover and reduce the impact going forward is what we’re focused on going forward,” Lowe added.

The DBJ head said focus will be placed on agriculture, manufacturing, distribution and tourism.

The focus on agriculture will target businesses in the breadbasket parish of St Elizabeth while distribution will focus on retail and wholesale, which Lowe highlighted involves many small and micro businesses.

“We want to ensure that we are very targeted and very focused by making sure that these windows support them in their capacity to restore normalcy,” said Lowe. Describing the tourism industry as being “critical”, Lowe said focus will be placed on people in the craft sector and those in attractions.

The M5 Business Recovery Programme is just one of many interventions DBJ will be rolling out.

There will also be a grant programme that will be rolled into funding needs, and Lowe explained that the aim of the grant is to encourage innovation, in particular where people will endeavour to do better than they were doing before.

Lowe said DBJ will also be offering collateral cash support of up to 80 per cent in instances where buildings that were previously used to secure loans were damaged or destroyed.

“What we believe is important as a development bank is to use our ability to intervene by offering credit collateral support,” declared Lowe.