Status: Completed

Period of implementation: 2009

Donor: European Union – European Development Fund

Direct Beneficiary: Ministry of Finance

Implementing Agency: Ministry of Finance, ONAO

Donor Contribution: 9,000,000 EUR

Background:

During the period 2009 – 2010, the European Commission approved the financing of a facility called the Vulnerability FLEX mechanism (V-FLEX). The V-FLEX was a short term (2009-2010) and targeted demand driven mechanism, providing approximately EUR 500 million to help the African, Caribbean and Pacific (ACP) countries cope with the impact of the global financial crisis and economic downturn.  It provided rapid and targeted grants in addition to the loan-based assistance of the World Bank, the International Monetary Fund, and regional development banks, institutions that supported the development of this instrument.

Objective:

To provide a swift response to help the worst affected countries maintain priority spending and reduce the social costs of the global financial crisis.

Project description: 

The V-FLEX instrument pre-emptively provided financial support, based on forecasts of financial losses and other vulnerability criteria. Antigua and Barbuda made a successful application to access the instrument and was awarded and amount of 9,000,000 EUR. 

Antigua and Barbuda was among the ACP countries who qualified for the instrument due to its high degree of economic, social, and political vulnerability; suitable policies in place to fight the crisis; sufficient absorptive capacity; and demonstrated financing gap in its national budget. 

The capital injection received helped to lessen the severity of the impact of the crisis by closing or significantly reducing identified financing gaps, rather than acting solely as a recovery facilitation, after the damage was done.