Caribbean islands are small island developing states (SIDS) boasting rich biodiversity, vibrant cultures and physical beauty. They are unique, but have similar vulnerabilities, including small, open economies; inadequate institutional capacities; limited resilience to external shocks; limited economic alternatives and reliance on few climate sensitive sectors; high indebtedness; and degraded natural ecosystems. These challenges are compounded by high risk to natural hazards, climate change, and amplified by COVID-19. Notwithstanding, the Caribbean like other SIDS, are recognised for their ownership and leadership in advancing the SIDS Agenda.
How do these countries even try to address these diverse and interlinked challenges? Key partnerships are essential in engendering sustainable solutions. Being a focus region for both organisations, the European Union (EU) and the United Nations Development Programme (UNDP) are working together to address key development priorities in Latin America and the Caribbean (LAC). In fact, the EU and LAC agreed on a New Agenda1 earlier this year to strengthen partnerships between the two regions.
Within this context, I wish to share reflections on three areas integral to Caribbean development: climate action, sustainable use of biodiversity and sustainable tourism.
Climate change threatens the Caribbean people, affecting their social, economic and environmental well-being. The region continues to be disproportionally impacted by climate change and natural hazards such as storms, floods, heatwaves and droughts. Since 1950, over 500 disasters worldwide hit small states with populations of less than 1.5 million2. Of these, over 320 were in the Caribbean, killing more than 250,000 people and affecting more than 24 million through injury, loss of property and livelihoods. UNDP’s Post Disaster Needs Assessments (PDNAs) between 2017-2022 record the impacts of natural hazards in the Caribbean, measured in terms of Loss and Damage. For example, in 2017 the toll of Hurricanes Irma and Maria on Dominica’s GDP was 192% of the previous year.
UNDP is at the forefront in helping countries enhance resilience to climate change. On this journey, the EU has been a key partner. Supporting over 120 countries, the Climate Promise is UNDP’s main response to climate change. Working with other UN agencies and partners, UNDP is helping countries meet their ambitious targets in their Nationally Determined Contributions (NDCs). Also, UNDP is scaling up its support to assist countries to transform their NDC targets into concrete action while continuing to push for greater ambition. Leveraging the NDCs as an umbrella, UNDP is bringing together its extensive infrastructure, global knowledge networks and substantive offers to provide comprehensive support on NDC implementation.
Sustainable Use of Biodiversity
The Caribbean is regarded as a biodiversity hotspot. However, many countries are experiencing rapid biodiversity loss and environmental degradation which is a critical development concern. The countries rely heavily on their natural resources for socio-economic survival, driving economic activities such as tourism, mining, agriculture and fishing and many other sectors.
UNDP upholds and supports the conservation, rehabilitation and climate-informed management of biodiversity and ecosystems which increases resilience to climate change and provides low-cost, long-term solutions to protect lives, livelihoods and infrastructure. The Caribbean could be well-positioned to implement adaptive policy bundles to maximise the blue and green economies with innovative nature-based and green solutions, boosted by catalytic investments.
In the New Agenda, the EU and LAC see opportunities to work together towards climate neutral and nature positive economies. Hence, both regions are committed to protecting biodiversity, halting deforestation, promoting more circular economies, improving waste and water management, increasing resource productivity, tackling pollution and investing in climate resilience.
Sustainable biodiversity financing is essential. Innovatively, UNDP and the European Commission has been advancing biodiversity finance by raising and managing capital and using financial incentives to support sustainable biodiversity management through the Biodiversity Finance Initiative (BIOFIN). In the Caribbean, at least two countries have already started BIOFIN processes.
A significant proportion of the GDP of the Caribbean, Latin American and European nations depend on travel and tourism. It is a major component of Caribbean economies although there are challenges. The region is most reliant on travel and tourism globally. COVID-19 had a significant impact on the Caribbean with GDP contraction by as much as 16-20%3 in some countries in 2020. Travel and Tourism GDP dropped by 53.2% in 2020, worse than the global average decrease of 50.4%.4
Undoubtedly, the pandemic have been devastating, however, the challenge ahead is to rethink the Future of Tourism in the Caribbean. The traditional tourism model has created benefits, but it is not generating enough social and economic value for the countries. The pandemic provided a turning point to change the paradigm to more sustainable and diversified forms of tourism built on maximising the blue, green and orange economies.
In 2021, UNDP and the EU-LAC Foundation partnered, through a series of country dialogues, to promote recovery and encourage policies to support sustainable development and diversification of the tourism sector in LAC. The aim of the initiative was to promote “Good practices and recommendations to mitigate the impact of the COVID-19 pandemic and sustainably transform tourism in Latin America and the Caribbean and the European Union.” A key finding from the dialogues showed that achieving the full potential of Caribbean tourism requires diversification, enabled by digitalisation, innovation and funding to micro, small and medium-sized enterprises (MSMEs).
The new tourism model should be more sustainable and inclusive and embrace a shift from mass market to unique market niches characterised by smart, customised travel, higher expenditure rates, higher valued niche products and reduced impact on the environment. Governments could develop and expand cultural tourism, community-based tourism, eco-tourism, business and sports tourism, health and wellness tourism. The potential of health and wellness tourism remains untapped. The global wellness tourism market size was valued at USD 814.6 billion5 in 2022 and is expected to expand 12.4% from 2023 to 2030.
Despite the many multi-dimensional challenges faced by Caribbean SIDS, there is still hope for a brighter future built on resilience and solidarity. The strategic regional vision is clear, UNDP and the EU will continue to work together to support and advance sustainable and resilient development in the region so that everyone can achieve their fullest potential.
1 Joint Communication: New Agenda to strengthen EU's partnership with LAC (europa.eu)
2 International Monetary Fund
3 World Bank 2021
4 World Travel and Tourism Council 2022
5 Grand View Research: Market Analysis Report