An estimated US$3.7 million has been committed by the Caribbean Development Bank (CDB) to support micro, small and medium-sized enterprises (MSMEs) in St Lucia.
Under the newly approved facility by the regional bank's board of directors, the funds will enable the Government of St Lucia to provide grants and loan financing to suitably qualified firms in the Organisation of Eastern Caribbean States (OECS) territory.
It is anticipated that the programme will create more resilient MSMEs, better positioned for growth and sustainability, and even more capable of contributing to the country's overall economic development. Additionally, training and technical assistance will be offered to the small businesses to enhance their operational capacity. Counterpart funding is also to be provided by the St Lucian Government.
The loan facility will be available to qualified St Lucian entrepreneurs with sustainable businesses who are unable to meet collateral or other lending requirements of traditional financial institutions.
"The project will have a two-fold positive impact, permitting the Government of St Lucia to retain the flexibility needed to support growth recovery through funding the critical MSME sector at a time of continuing urgent need, while improving debt dynamics and supporting the government's commitments to long-term debt sustainability by contributing to a reduction in the overall average cost of debt," said Daniel Best, director projects at the CDB.
Under the project, to be administered by the Small Business Development Centre (SBDC) and the St Lucia Development Bank (SLDB), entrepreneurs will be trained in business management and sector specific technical-vocational areas. CDB's Caribbean Technological Consultancy Services (CTCS) will also through its trainer programme, offer modules in a number of areas. Some of these include business incorporation, continuity planning and disaster preparedness; bookkeeping and financial management; e-commerce and marketing; export development; environmental sustainability and other gap areas identified in the industry.
MSMEs, which have been touted as the engines of growth in many Caribbean countries, is also in St Lucia regarded as the backbone of the economy, providing employment for a large cross section of some of the most vulnerable members of the labour force. It is estimated that the sector contributes close to 40 per cent of country's gross domestic product (GDP) and provides employment for close to 40,000 persons or approximately 49 per cent of the labour force. Estimates indicate that there are over 6,000 MSMEs registered in St Lucia â€” 2,000 of which are operated by persons within the 18-35 years age group.
"This intervention will shore up the private sector as St Lucia's MSMEs account for a large proportion of all private enterprises, employment, and contributions to GDP," the CDB said.